Bounty Hunters - Greg London

1. Bounty Hunters
Map Makers
&
Gold Miners
Metaphors for Designing Fair Intellectual Property Laws
version: 21 October 2006
Copyright 2006 Greg London
email at greg london dot com
This work licensed under the CreativeCommonsÐAttribution license.
http://creativecommons.org/licenses/by/2.0/
The following information is provided for attribution purposes:
Author's Name: Greg London
Title of Work: Bounty Hunters
URL: http://www.GregLondon.com/cc/by
For the latest version of this work, HTML or PDF, go to:
1

2. http://www.greglondon.com
This document was created using OpenOffice
http://www.openoffice.org
running Fedora Linux
http://fedora.redhat.com
on a Penguin x86 PC.
http://www.penguincomputing.com/
18 April 2005: first public draft made available
29 April 2005: fix typos (Thanks to Robinson P. Tryon)
26 May 2005: fix typo (Thanks to Richard Eriksson), remove CC images to reduce bandwidth load, use
compressed JPEG image to reduce bandwidth.
2 April 2006: fix links to Bruce Lehman's bio that had changed. Added some court cases to "external links"
section, changed proposed term solution to 42 years instead of 40 years.
21 October 2006: change character names in story to avoid misunderstandings with initials.
Table of Contents
1 What Should Be? 5
1.1 "What incentive systems should exist in the world?"- Bill Gates 5
1.1.1 "Systems" 6
1.1.2 "Incentive" 6
1.1.3 "Should" 6
1.2 Models and Metaphors 6
1.3 Cake Cutting 7
1.4 A Model / Metaphor for Intellectual Incentive 7
2 A Town that Never Was 9
3 Art Imitates Life 24
3.0.0.1 Intellectual works are abstract ideas created by the labor of human minds. 24
3.1 Wild Frontier 24
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3. 3.1.1 The First Outlaw 26
3.1.2 The Hostage Scenario 26
3.1.3 The First Bounty on Earth 27
3.1.4 Measuring Success (Catching the Bad Guy) 28
3.1.5 Winner Take All 30
3.1.6 Cutting Cake for Bounty Hunters 31
3.2 The First American Bounty 31
3.2.1 Isaac Preston pays a visit to Mayor Maddox. 32
3.2.2 The Bounties Keep Going Up 33
3.2.3 An Immortal Mouse 34
3.2.4 The Argument Against Life Plus N 36
3.2.5 Resetting the Bounties, The Ideal Goal 38
3.2.6 Resetting the Bounties, The Realistic First Step 41
3.3 Galen's Trust and Copyleft 41
3.3.1 The Hostage Scenario 43
3.3.2 An Alternative Incentive System 44
3.3.3 Galen's Trust Competes with Preston Corporation 45
3.3.4 The Halloween Documents 46
3.4 A Metaphor for Copyright and Patents 47
3.4.1 Map Makers and Miners 48
3.4.2 Progress: Expanding the Known Universe 49
3.4.3 Map Makers are Writers 50
3.4.4 Miners are Inventors 51
3.4.5 Copyright Versus Patent 52
3.4.6 Gold On the Ground 54
3.5 Patenting Language 56
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4. 3.5.1 Starting the Slippery Slope 57
3.5.2 Land Grab 58
3.5.3 Linux Competes with Microsoft 60
3.5.4 Mute Patents 61
3.5.5 Software Patents: Bounty Hunters Setting the Bounties 62
3.5.6 An End to Software Patents 63
3.5.7 Impeding Progress with Language Patents 64
3.6 Digital Millennium Copyright Act 66
3.6.1 The Case For the Anti-Circumvention Clause 67
3.6.2 The Case Against the Anti-Circumvention Clause 68
3.6.2.1 It doesn't work 68
3.6.2.2 It Isn't Needed 68
3.6.2.3 It Kills Fair Use 69
3.6.2.4 It Creates Patent-like Powers Without the Mess 69
3.6.2.5 It Has Stunted Independent Research 71
3.6.3 An End to the Anti-Circumvention Clause 72
3.7 Bruce Lehman Gets Corporate Donations 73
3.8 Eureka's Prologue 73
3.8.1 Championing the Fight 73
3.8.2 Barn Raisings 74
4 Summary 75
5 External links 79
5.1 Bill Gates Interviews 79
5.2 The Statute of Anne 79
5.3 The Longitude Prize 79
5.4 Section 8 of the U.S. Constitution 79
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5. 5.5 U.S. Copyright Act of 1976 79
5.6 U.S. Copyright Term Extension Act 79
5.7 The Halloween Documents 79
5.8 Bruce Lehman's biography 80
5.9 Wheaton v. Peters (1834) 80
5.10 Atlantic Works v. Brady (1883) 80
5.11 Graham v. John Deere (1966) 81
1 What Should Be?
In January 2005, Bill Gates had an interview with CNET that included the topic of Intellectual Property (IP)
reform. At one point, Bill Gates made a reference to communists. Many reformists became upset, thinking
Gates was calling them communist. Later that same month, Gates had an interview with Gizmodo, and the
"communist" remark came up in the discussion. Gizmodo asked Gates to clarify his previous comment. Gates
replied:
"No, no, no. I didn't say those people were 'communists.' I did say that they're..."
Up to this point, it's all pretty standard. Gates denies any wrong doing. He's about to clarify what exactly he
did say IP reformists were, but then he seemed to realize at the last moment that there was no cheese down
that tunnel.
Gates then stops, and starts from a new approach. He asks a question that completely changes the topic.
"What incentive systems should exist in the world?" -- Bill Gates
And when I read it, I said "yes, that's exactly it."
This is an exceedingly important question that keeps getting asked over the centuries of copyright and patent
law evolution. The rights and terms for copyrights and patents keep changing over the years. Individuals with
large monetary stakes in a written work often push to have the rights and durations of copyright extended in
their favor. New writers and inventors complain that these large stakeholders have taken the whole pie for
themselves, allowing no one to compete with them. The public seems to be stuck in the middle, wanting to
reward writers and inventors, but also wanting competition to drive progress.
I was disappointed as I read further that Gates never answered his own question. And so I was left to ponder it
for a while. What struck me most was the wording of the question itself. The words in the question point to an
underlying truth of how things work. The question actually points to the answer.
1.1 "What incentive systems should exist in the world?"- Bill Gates
Systems, incentive, should. Three very important words.
1.1.1 "Systems"
Copyright and Patent law are components in a system of players. Individuals have an internal drive to
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6. self-interest as well as an internal drive to community-minded behavior or fair play. Copyright and Patent
laws are intended to affect that system in a strategic way.
1.1.2 "Incentive"
Copyright and patent law punishes certain behaviors and rewards certain other behaviors. By providing these
incentives, copyright and patent law CHANGES the way players behave.
1.1.3 "Should"
Copyright and Patent law is OPTIONAL. The system can operate without the influence of copyright and
patent law, and the players will adjust accordingly. Despite dire warnings from some copyright and patent
holders, the system of players is inherently stable without legal influences. Chaos will not ensue due to a lack
of copyright and patent laws. Rather, players will readjust to a different point of balance.
Since copyright and patent law is optional, the question is when and how SHOULD the law be implemented.
Copyright is not something the world MUST have. Copyright is optional and should only be adopted if it
creates a win-win situation for the community and the creators.
1.2 Models and Metaphors
What is needed is a model or metaphor that describes the actors in the system with and without intellectual
property laws in place. For a model to be useful in determining what legal incentives SHOULD be in place, it
must predict what will happen without law, with varying implementations of law, and it must also be able to
predict results with fair players and with unfair players.
Once you have a model, you may be able to find a generic algorithm that describes how to find a fair result. If
the algorithm produces a fair result with a spectrum of players in the model, then you've found a relatively
robust algorithm.
1.3 Cake Cutting
The basic cake cutting algorithm works like this: There is a cake treated as common property between two
people. These two people want to find a way to cut the cake such that both of them get a fair piece. A solution
is to have one person of the two cut the cake, and then allow the other person to pick which piece they want.
This is a fairly robust algorithm because it will produce a fair result under most circumstances, regardless of
how selfish or selfless the actors are. The person cutting the cake has incentive to cut fairly because if one
piece is noticeably bigger, the other person will naturally tend to pick that piece, and the person who cut the
cake will get a smaller piece. Selfish cake cutters are given incentive to cut fairly.
But there are other algorithms that you could use to cut the cake. For example, you could have one person cut
the cake and pick which piece they get. This produces a fair result only if the cake-cutter is a reasonably fair
person. The model shows that this algorithm will produce an unfair result if the cake-cutter serves only their
self-interest.
Another approach is to bring in a third person to act as an impartial cake-cutter, have them cut the cake, and
distribute it accordingly. This is also subject to abuse when unfair players are in the system. The third person
acting as impartial cake cutter is an actor the same as any of the other players, and could be filled by various
people across the spectrum of selfish to selfless.
A model that relies on finding a "fair" or "impartial" individual for the algorithm to achieve a fair result is not
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7. nearly as robust as an algorithm that doesn't care about the internal drives of the players but achieves a fair
result anyway.
1.4 A Model / Metaphor for Intellectual Incentive
The cake cutting system does not model all aspects of how intellectual works relate to all the different actors
in the system.
So, back to Bill Gates' question: "What incentive systems should exist in the world?"
We need a model or metaphor that describes the system of intellectual works from before the works are
created, to while they are treated as property, to the point where they become public domain (public property).
We also need the model or metaphor to describe a system where many actors in a system design an "incentive
system" for a few of the players.
The answer to this question should produce a model or metaphor that sufficiently simulates a system and
allows you to predict conditions that make the system unstable, as well as design algorithms that are stable
and fair and robust.
After pondering this for a bit, it occurred to me that the metaphor for this system is that of a bounty or reward
offered by the public at large for any individual willing to take personal risk for a chance at successfully
collecting the bounty. Writers and inventors in this system play the part of Bounty Hunters.
Before you let any preconceived notions and/or prejudices towards bounty hunters cloud your judgment, keep
in mind that the same way a cake-cutting algorithm is usually used for something besides cutting cake, so too
the bounty hunter algorithm isn't just used for catching outlaws.
In discussing this "bounty hunter" model to people, most thought of Bobba Fett when I said bounty hunter.
Bobba Fett is a completely selfish bounty hunter in the Star Wars movies, a faceless, anonymous, soulless
character who hunts the good guys. And with this character in mind, a lot of negative reactions were
expressed towards the metaphor of writers as bounty hunters.
But to react negatively to a metaphor about intellectual property because it involves bounty hunters, is to react
negatively to a cake cutting algorithm because you don't like cake. It isn't really about splitting a cake. And it
isn't really about Bobba Fett.
And so, I present to you a tale of a fictional town named Eureka. Eureka was founded in the frontier of the
wild, wild west. And it will see bounty hunters of all types.
Afterwards, we'll look at how the metaphor applies to stuff besides cutting cake and catching outlaws.
2 A Town that Never Was
Once upon a time, there was a town by the name of Eureka. It was a good place built by honest and
hardworking folks like farmers and ranchers, carpenters and masons, bankers and railroaders. Life in Eureka
was good.
For a while, anyway.
It didn't happen all at once, but troubles slowly beset themselves upon Eureka in the form of organized crime,
gangs, and outlaws of various sorts. Sheriff Riley had a small group of deputies that managed to keep the
peace with the usual troubles that might arise between good folks who had disagreements between one
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8. another or simply too much to drink. But his group was too small to chase after bank robbers and train-robbers
and cattle rustlers and horse thieves all at the same time.
Since troubles grew slowly, Sheriff Riley and his deputies focused their efforts on whoever was causing the
most trouble at the time. When the Coleman Raiders robbed a string of banks, Sheriff Riley and his deputies
tracked them down and brought them to justice. Same thing happened when the Farley Gang robbed several
stagecoaches. It wasn't perfect, but it was good enough.
For a while, anyway.
But then Tinker Tyson and his outlaws started robbing trains. The problem was that Tinker was really good at
robbing trains and really good at not getting caught. He was as smart as he was brutal. After Tinker and his
outlaws robbed six trains and killed over a hundred passengers, the Morgan-Jack Locomotive company
threatened to stop all train service to Eureka unless the outlaws were arrested.
Sheriff Riley was a thorough but methodical man and looked at all the places Tinker Tyson could be hiding
and all the different tracks where Tinker could find trains to rob. Eureka was in the middle of a vast, untamed
territory. Riley told the railroad folks he figured with 150 new deputies, he could guarantee he'd either capture
Tinker or force him to move on to another city within a year.
That was no where near soon enough, and the railroad company threatened to cut all service to Eureka unless
Tinker Tyson was captured within a month. And they wouldn't come back to Eureka until he was caught.
A whole year without train service would kill the city of Eureka, and the townsfolk knew it. They also knew
that even if they could afford to wait a year to flush out Tyson, they could never afford 150 new deputies on
the town's payroll.
Victor Clayton, one of the biggest property owners in Eureka, came forward with $25,000 of his own money
as a reward for anyone who could bring Tinker Tyson to justice within a month. Clayton knew that if Eureka
lost train service, he could lose everything he owned.
The Haskell brothers had heads big enough to think they could take on Tinker Tyson. Unfortunately those big
heads weren't filled with the smarts enough to know the difference between causing trouble in a local bar and
taking on a band of professional outlaws. Tinker decided to use them as a warning to the others and had them
killed. With that, no one else seemed interested in even thinking about collecting the reward. After a week,
Clayton raised the reward to $50,000.
This got the interest of a local gunslinger by the name of Garrett who knew a thing or two about trains and the
people who robbed them. Garrett also knew a thing or two about the land around and about Eureka and where
a train robber might hide. He loaded up on supplies and rode out of town.
After two weeks of false starts, old trails, and dead ends, Garrett tracked Tinker Tyson and his outlaws to an
abandoned silver mine in the mountains. Garrett had three sticks of dynamite, a spool of wire and a plunger
that he used to even up the odds a bit. The rest of it was settled with an old-fashioned gunfight. Three weeks
after he left Eureka, and one day before Clayton's deadline, Garrett rode back into town with Tinker's body to
collect his reward.
The people of Eureka welcomed Garrett as a hero. Clayton gladly paid the bounty knowing that he wouldn't
become the largest property owner in a ghost town. Train service to Eureka continued interrupted. Garrett told
the Sheriff about the abandoned mine and Riley decided to plant explosives and collapse it so that no one
could use it as a hideout again.
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9. John Maddox, the Mayor of Eureka, saw the benefit of having bounty hunters as a supplement to the regular
law enforcement for the city. The Bennett Boys had robbed the Savings and Loans for half a million dollars
six months ago and Sheriff Riley had not captured them yet. And some of the ranchers had been complaining
about cattle rustlers enough for the Mayor to know it weren't all just bellyaching.
But Mayor Maddox knew the people of Eureka couldn't afford to pay the taxes needed to offer a $25,000 or
$50,000 bounty. Maddox had the idea that Eureka could spread the payments out over a period of time, so that
the payments were small enough for Eureka to afford it, but the total was big enough to interest someone like
Garrett into getting the job done.
Maddox proposed the idea at the next town meeting. Eureka would offer a bounty of $25,000 over a period of
25 years for the capture of the Bennett Boys. Sheriff Riley thought it would be a great way to split up the
work. He and his deputies could take care of the day to day business of keeping law and order. And bounty
hunters could be used to take care of the random villains who fed off of the good folks of Eureka. The people
of Eureka thought a thousand dollars a year was dirt cheap to get the Bennett Boys off their streets.
Four months later, Isaac Preston hauled the Bennett Boys into town and started collecting his reward.
Crime went down in Eureka, and the town grew into a metropolis. Preston and other bounty hunters collected
rewards when trouble arose. As he got older, Preston formed his own company, IP Inc. Eureka had grown so
big that Preston could afford to hire employees. Garrett continued working as a solo act, bringing in the
occasional bad guy for a reward. Everyone was happy.
For a while, anyway.
Twenty-three years after he brought in the Bennett Boys, Isaac Preston started to get a little nervous. His
annual bounty payment for the Bennett Boys would stop in two years as would two other annual payments.
He had four annual bounty payments that would end in three years. And over a dozen payments he was
getting every year that would dry up in four years.
He was going to have a serious cash flow problem soon. So Preston decided to pay a visit to Mayor Maddox.
"It just isn't fair, Mayor. I did all that work, risked life and limb, and brought in the Bennett Boys for a mere
$25,000."
"That was the reward offered by the city of Eureka. You didn't have to take the job."
"Yes, but the Bennett Boys stole half a million dollars and were planning on hitting another bank when I
caught them. They could have taken millions before Sheriff Riley had caught them. And I only got $25,000. It
just doesn't seem fair."
"But you shouldn't have taken the job for $25,000 if you didn't think it fair."
"And that same year, I brought in Rex and his bunch when they were rustling cattle. Remember?"
"Sure, I re-"
"And those cattle were worth an awful lot more than the $15,000 reward that Eureka offered. Heck, the
Langrie herd was over three hundred head of cattle alone!"
"But then why-"
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10. "And the other thing is that inflation has been so bad the last few years that a thousand dollars a year just isn't
worth what it was twenty-some years ago. Even if you don't increase the rewards, you should raise them just
to keep up with inflation otherwise a thousand dollars a year just isn't enough."
"Well, I don't know. I mean, what exactly did you have in mind?"
"Look, Mayor, I'm not a greedy man. I just want my due. I'll tell you what. $50,000 seems fair for saving the
city what would have turned into millions of dollars of thievery and who knows how many dead folks. Don't
you think?"
"But Eureka can't afford $50,000."
"It's just another $25,000. And you can spread it out over the next 25 years like before."
"I ... guess ... we could handle that."
"And another $30,000 should more than cover saving a thousand head of prime Midwestern beef."
"Thirty thousand?"
"Uh huh. The way I see it, if Eureka just doubles how long it makes its payments, then it will work out even
steven."
"Double?"
"Well, isn't $50,000 fair for saving the city half a million dollars?"
"I suppose."
"And isn't $30,000 fair for saving a thousand head of cattle?"
"I reckon it is."
"Well, there you have it then. This is really just making adjustments for inflation and bringing the rewards in
line with the benefit I provided."
"I guess I could bring it up at the town meeting next month."
"Thank you, Mayor. I would appreciate that."
A week later, Mayor Maddox received a campaign contribution from Isaac Preston along with a note saying
"Eureka wouldn't be the same without you as Mayor."
At the next town meeting, Mayor Maddox brought up an item concerning "inflation adjustment for bounties"
and suggested that bounties need to be adjusted for inflation by doubling how long they make the payments.
The townsfolk scratched their heads but figured the Mayor must know what he was talking about, and on his
recommendation, they approved the measure.
Eureka continued to grow and prosper. The crime per capita continued to drop. But there were enough crimes
that Preston and his company kept a brisk business of bringing in bad guys. The number of employees
increased. Preston brought in his son, Irving, to work the business. Garrett, who had always worked alone as a
bounty hunter, became a duo when he started showing his son, Galen, the ropes of the bounty hunter business.
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11. Even Maddox passed the torch to his son when Mitchell became the new Mayor of Eureka. Everyone was
happy.
For a while, at least.
'Twas a sad day indeed when Preston and Garrett were both killed in a shootout while trying to round up the
Kirby twins who had kidnapped one of Eureka's daughters. IP Inc and Garrett's son were there when it
happened. The Kirby twins died in the shootout as well. The kidnapped girl was rescued, but it was the only
good thing to come of that otherwise dark day.
A week later, Irving approached the Mayor.
"It's a sad day, Mayor Mitchell."
"Yes, truly it is."
"My pa is in the ground, and his works will follow soon after."
"What's that?"
"Well, all the good things that my pa did for Eureka, and his rewards are gonna dry up soon."
"You mean the bounties the city has been paying him?"
"Sure. And it just don't see right to me that he gave his life but will so soon be forgotten."
"Forgotten? We're planning on erecting a statue in his honor. And another one for Garrett too."
"But to give his life and to have his rewards end so soon after his death. It just doesn't seem fair."
"Well, your pa and Garrett both knew the risks involved in trying to collect the bounty and they decided it was
worth the risk."
"Yes, but how can you put a price on a man's life?"
"Well, I'm not saying..."
"My pa devoted his life to helping Eureka. Don't you think it only fair that Eureka give him his due?"
"His due?"
"Yes, his due. He spent 50 years of his life making Eureka a better place. He should be rewarded for 50
years."
"Your pa has gone to meet his maker. He don't care about no earthly reward. Besides, how would he collect?"
"But a man who gave his life for us should be allowed his legacy."
"Well, like I said, the statue..."
"It don't pay for a man's life."
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12. "Well, I reckon it don't." The mayor seemed stumped. "What did you have in mind?"
"50 years of a life dedicated to making Eureka a better place should be rewarded for 50 years after his death. I
think it only fair that Eureka extend all its bounty payments to my father's estate for 50 years after his death."
"That seems like an awful lot of money, Irving. I don't know if Eureka could afford it."
"My pa gave 50 years of his life to this city, and all you can think of is the money?"
"I'm sorry, Irving, I didn't mean to be selfish." The mayor pondered it for a moment. "I'm sure we can figure
out a way to pay your father's estate."
"Thank you mayor."
A week later, Mayor Mitchell received a campaign contribution from Irving along with a bounty hunter's
badge and a certificate that proclaimed Mayor Mitchell an honorary bounty hunter.
Mayor Mitchell called a special town meeting and gave an emotional speech about the sacrifices made by the
bounty hunters Preston and Garrett. He proposed that to keep their legacy alive, their bounty awards should all
be extended until 50 years from their death. The speech was a real tear-jerker.
A few folks tried to question the validity of some of Mitchell's emotional claims. Some tried to ask about the
source of his campaign contributions and his status as honorary bounty hunter. A couple of independent
bounty hunters said they would be willing to bring in the bad guys for the usual size bounty, that they didn't
need payments for 50 years after their death. But all these nay-sayers were booed out of the meeting room.
And the "Bounty Hunter Legacy Act" became law.
Galen, son of Garrett, had not been at the meeting because he was out in the mountains on the trail of a
stagecoach bandit. After some time, he followed the bandit to an old shack in the hills, and there, Galen
captured him. Galen hauled him back to Eureka and told the sheriff about the shack. The sheriff sent some
deputies out to tear down the shack, and then he gave Galen a receipt for his reward. Galen looked at it and
was surprised to see it say he'd get paid his reward for 50 years after his death.
"What am I going to do with reward money when I'm dead, sheriff?"
"You can pass it to your kin."
"I don't have any kin. And besides, if I did and they helped me bring in this guy, I'd split the reward with them
now. That's what my pa did when we rode together. I wouldn't make anyone who pulled pistols beside me to
wait until after I died before they got paid."
"Eureka passed an ordinance that all bounties are to be paid until 50 years after the bounty hunter dies."
"Well, I set out to catch that stagecoach bandit for a lot less than that. I won't take it. Just give me the old
reward."
"The law says I have to pay you a bounty for 50 years after you die. I'm the sheriff, and I can't break the law."
"But the town don't have to pay me that much."
"You'll have to talk with the Mayor about making an exception."
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13. Galen rode over to visit Mayor Mitchell. The mayor was overseeing the construction of his new office.
"Mighty fine building you're putting up there, mayor."
"Galen, fellow bounty hunter, how are you?"
"Fellow bounty hunter? You never had hot lead flying at you your whole life. What are you talking about?"
"I'm an honorary member only, of course. Irving even gave me a badge and certificate and everything."
"Irving, aye?"
"Yes, sir. Good ol' Irving. He's been supporting the Mayor's office since he took over IP Inc."
"Supporting the office?" Galen was more than a little suspect. "Or supporting you?"
"Well, the taxes his company pays is part of what's paying for this new building for the mayor's office."
"Wait a minute. You tax the people of Eureka so that you can pay our bounties. And then you tax the bounties
to pay for your buildings? Don't that seem odd?"
"It's all perfectly legal."
"But you pass the laws around here, so you're the one making it legal. And your laws are set up so that the
more Irving benefits the more you benefit, and the citizens are the one footing the bill."
"It's all very complicated, Galen. You make it sound as if I were stealing something from the very citizens I
represent."
"You keep having the people pay bigger and bigger bounties to Irving. And then Irving turns around and uses
those huge bounties to give you a big fat campaign contribution. Over in Dodge City, they call that a kickback
and it's illegal."
"Dodge City is overrun with criminals. We pay bounties that are generous enough that bounty hunters will
bring the criminals off the streets."
"Dodge City has no more crime than we do. And they pay out a lot less in bounties, which is why I came here
in the first place. I don't want a bounty that lasts 50 years after I die. The people of Eureka shouldn't have to
pay me that much."
"I can't be making special exceptions for every bounty hunter that wants to negotiate a different price."
"You did for Irving. It's just that he negotiated the price up and gave you a piece of the action."
"Look, Galen. If you think the people are paying too high a bounty, you can keep what you think is fair, and
give the rest of it back to the people."
"Meanwhile, Irving is making out like a bandit and you keep getting your piece of the pie."
"I don't expect you to understand the nuances of how government works, so I'll take that comment as a
reflection of your ignorance."
13

14. "Oh, I know how it works alright, and it stinks like Sam's slaughterhouse on a hot summer day."
Galen turned and left before Maddox could reply.
Galen road off to Charlie's Cantina, one of Eureka's more wretched dives. It was where Galen usually went
after collecting a bounty to celebrate. It was also where he went when he needed to find extra gunslingers to
help him on a particular job. And when things went bad, it was the place where Galen went to drown his
sorrows.
Galen drank three men under the table and threw two more out the front door before he settled down into a
corner with a bottle to brood.
Most folk forgot he was even there. What exactly happened next, no one knows for sure. But half a dozen
people who were closest to him say they saw Galen stagger to his feet with bloodshot eyes swaying like a pine
in a cyclone, mumbling "guns and money ... guns and money ..." over and over to himself. Then all of a
sudden his eyes widened and everyone heard him scream one word before he staggered out of the bar.
"Lawyers!"
Eureka only had but so many lawyers living within city limits. Unfortunately for Lantry Landon, his house
happened to be closest to Charlie's Cantina. And Galen staggered down the street to pound on Lantry's door in
the middle of the night.
"Now let me get this straight, Galen. You want to set up a trust fund where you'll contribute a part of your
bounties and make that trust available to anyone willing to go collect on other bounties?"
"With the extra stipulation."
"Right. That anyone who takes from the trust to collect a bounty must donate to the trust a a percentage of
their collected bounties as well."
"Yessir, exactly that."
Lantry looked at Galen a moment. "How much whiskey you got in you right now?"
"Look, you old cuss. I can shoot straighter now than you ever could."
"But it don't make sense, Galen."
"Why the hell not, damn it! Say you got some kid who's pretty sharp in the head, fast on the draw, and has a
good sense for trouble. Say he's the kind of person who could collect on a bounty. But say he ain't got the
money to do it. Maybe he ain't got no guns or ammo. Maybe he ain't got a horse of his own."
"Yeah, the setup I get, it's what follows that don't add up."
"So, say this kid can borrow some money from this trust fund to buy a horse. But he don't actually borrow it in
the sense of ever having to pay it back directly. Say he gets to withdraw the money on the condition that if he
does bring in a bad guy and collect a bounty, and say he used that horse to do it, then he has to give some of
that bounty back to the trust."
"But how do you keep the lunkheads from bleeding you dry."
14

15. "I'll pick who gets the first loans. And of those, everyone who is successful, gets a bounty, and has to
contribute to the trust, gets added to the trust as a voting member. And every time someone new wants to
borrow money, all current members vote on whether to give it to him or not."
"OK, so you get this self-sustaining, possibly growing, trust fund going on for all eternity. The math adds up, I
reckon. But there's still a part that just don't make sense to me."
"What's that?"
"Why would you do such a thing?"
"Because Irving and Maddox are milking Eureka dry, and that ain't right. And because I can't think of any
other way of showing folks that they're being taken advantage of than to show that we can collect bounties for
a lot less money."
Lantry was too tired to argue and just nodded.
The next morning, Lantry filled out all the paperwork and set up a trust account at the bank. He then dropped
off copies with Galen.
Galen went down to Charlie's Cantina to find his first recruits. He had worked with many of the bounty
hunters who hung out there. He explained the trust to each one of them. Some of them thought him crazy.
Other's nodded their head with a "it's just crazy enough to work" look in their eyes.
Wyatt was the first to take him up on his offer. He wanted to get himself one of them new Winchester
semiautomatic rifles with a scope. Wyatt went to Lantry who had him sign the paperwork and gave him his
money. A month later, Wyatt brought in an outlaw by the name of Tillman and signed his reward over to the
trust. The trust then paid him what was his due.
Galen's trust grew into a huge success. It grew to the point where people borrowing from and contributing
back to the trust were regularly competing with IP Inc for the same bounties. Once it started cutting into his
bottom line, Irving visited the mayor.
"It just isn't fair, Mayor. These trust-fund kids are going to put us out of business. You've got to put a stop to
them."
"The whole idea of a bounty system is to encourage competition."
"Well, a bunch of rank amateurs are going to put a professional corporation out of business if this keeps up.
Do you want nothing but a bunch of amateurs between Eureka and the scum of the earth?"
"If they're successful, then why would Eureka care?"
"Need I remind you of the wagon-loads of money I pay you in campaign contributions every year? Or the
amount of taxes that IP Inc pays every year?"
"Well, there isn't much I can do. I can't just outlaw this bunch because they're competing with you."
"I have an idea. I want you to pass a law that lets us put bounty claims on any hideouts that we find."
"Bounty Claims?"
15

16. "Yep. If we catch a bad guy hiding out someplace, we want a claim so that we can purchase the land, and then
we get rights to any outlaw caught hiding out on our land."
"How will that help?"
"The trust fund kids won't be able to purchase any land, so we'll eventually be able to lock them out of all the
hideout locations. Once they can't collect bounties from these areas, we'll just squeeze them out over time."
"I don't think I can get city council to approve that."
"I'll make them all honorary bounty hunters and start contributing to all their campaigns."
"Passing a law is too visible. What I'll do is appoint one of your men to be Commissioner of the Land Deeds
office. The commissioner can set office policy as he sees fit."
"I've got just the man."
At the next town meeting, the Mayor motioned to appoint Darrell Dawson as new Commissioner of Land
Deeds. No one knew the importance of the fact that Darrell had been getting checks from IP Inc. in one form
or another for the last twenty years, and Darrell received the appointment. Within three months, Darrell
quietly distributed his new policies for the Deeds office. Included in these policies was a new policy that
allowed bounty hunters to purchase any undeeded land upon which they had captured an outlaw.
No one thought much of it at the time.
Then Galen caught a bank robber hiding out in the badlands and brought him to the sheriff to collect his
reward.
"Good job, Galen. Here's your receipt. You should be getting your first check in a week or two."
"Thanks, Sheriff."
"Oh, and you can take your receipt down to the deeds office if you want to purchase the bounty rights on that
piece of land where you caught this guy."
"Bounty Rights?"
"Sure. That land hasn't been deeded to anyone yet, so if you want, you can take that receipt to the Deeds office
and buy it and the bounty rights that go with it."
"I'm putting a portion of my reward into the trust. I can't afford to buy land."
"Well, if you don't and someone else does, they'll be able to claim the rights to any outlaw captured on their
land, regardless of who captured them."
Less than fifteen minutes later, Galen stormed into Mayor Mitchell's office to find the Mayor and Irving
having a friendly drink together.
"Well, I'll be damned." Galen strode into the room shaking his head. "That explains a lot."
"What burr you got under your saddle today, Galen?" Irving chuckled.
16

17. "You know old man Grady just a couple miles east of town?"
"Sure. Did Grady sell you a chicken that won't lay eggs? Is that what's got your rope in knots?"
"Grady's got some of the finest hens around Eureka. And he's got his dog Blue to guard them from any foxes
or coyotes."
"And what's that got to do with the price of gold in Eureka?"
"I figure I feel about what Grady would feel like if he walked in on Blue and some coyote sharing the same
water dish."
"You've been in the sun too long, Galen. You need to get some rest."
"Mitchell, who's interest are you supposed to protect and guard?"
"Eureka's interests, of course."
"Like main street ever voted for you or 123 Pine St can sign a ballot."
"Well, the people of Eureka, of course."
"And how do you get off betraying the trust of the people of Eureka, taxing them more than they need so that
Irving here can become one of the richest men in town?"
"Irving provides a valuable service that benefits this whole town."
"So do I, you old snake. And my team and I would do the same job for a lot less if you'd just let me."
"What are you rambling about, Galen? I'm not stopping you from doing anything."
"I can't afford to buy no bounty rights to some piece of land when I'm giving part of my bounties to the trust."
"That isn't my problem, Galen. The law is fair. It lets anyone buy those rights. If you want to buy them, and
you have the money, you can."
"But I'm trying to prove that we can bring in the bad guys for a lot less money, and you change the system to
favor whoever has more money and can afford to buy land to collect bounties."
"Well, I can't feel too sorry for you when you're a member of the trust you're giving money to. As far as I can
tell, you're just creating a pyramid scheme to make yourself rich. At the very least, you're making the same
amount of money as Irving here per bounty, you're just moving it around on paper."
"I can't touch any money in the trust without everyone's approval, same as any other bounty hunter who wants
to borrow money. And the trust started paying out benefits to victims of crime two months ago. So we're not
keeping all the money to ourselves. I still live on my pa's old place. But Irving here is one of the biggest land
owners in Eureka."
"So Irving kept his money and you didn't. That ain't his fault."
"I'm trying to bring in the bad guys without Eureka paying so much money in bounties."
17

18. "If that's what you want to do, Galen, then that's perfectly legal."
"Yeah, but now this Bounty Rights thing is going to make it so that only people who keep all their reward will
be able to buy Bounty Rights and stay in business. I can't do it for less money without getting squeezed out by
Irving and his great land grabbing machine of IP Inc."
"What's wrong with rewarding bounty hunters with land rights?"
"Because it encourages and rewards a monopoly. And it ain't natural. Before this law, I could chase after a bad
guy anywhere he went. Anyone could. Competition was encouraged. Success was rewarded."
"This is rewarding successful bounty hunters."
"Sure, by giving them a permanent monopoly. By outlawing competition on their land. Now, I might flush
some bad guy out of hiding, and if he happens to run onto Irving's land, I lose out because of some artificial
rule you made up. And Irving gets to collect after I acted like his bird dog. My success is punished every time
a bad guy runs onto Irving's land. And the fact that I'm Bounty Hunting for less money is punished because I
can't afford to buy land and compete with Irving."
"The law isn't meant to punish, Galen. It is meant to be a reward."
"A reward for you. Irving keeps making more and more money. And you keep getting more and more fat,
brown envelopes full of cash. And all of it paid for by the people of Eureka paying far more for bounties than
they need to."
"Eureka pays what it considers to be a fair price for bounties."
"Whatever happened to getting the lowest professional bid for a job? Isn't that what Eureka should pay?
Shouldn't it be the lowest bounty that will get the job done? The bounty that keeps Irving here in silk cowboy
hats and a thousand acre ranch is corporate welfare."
At this, Irving finally spoke up.
"Galen, you're starting to sound like a communist. Is that what you are? Someone who doesn't believe in
property rights? That's all these Bounty Rights are, after all: property rights. Are you anti-capitalist? Is that it?
Because you don't seem to like the fact that I make money off of my work."
"Irving, you haven't slung lead in years. You're lazy and comfortable and you're using your position to keep
yourself cozy. In itself, I wouldn't care a plugged nickel about you or how you live. But the thing is that you're
living the way you are by enforcing a monopoly on the people, granted in part by the purchase of a few
political offices. And that really burns my bacon. Capitalism is about competition. And in that sense, I'm all
capitalist. I know my bounty hunter trust is growing. And I know we're doing the same job as you for a hell of
a lot less money. And that means only one thing..."
He pointed a finger at Irving in a flash of movement and Irving flinched.
"In the long run," Galen finished, "I'll beat you."
Galen turned and walked out the door.
3 Art Imitates Life
18

19. It's a lousy place to end a story. But unfortunately, the story of Eureka and it's bounty hunters is a metaphor
for the history of intellectual works. The current state of affairs around intellectual works places Irving in the
mayor's office, sharing a drink and a cigar. As much as I'd like to write a happy ending for the good people of
Eureka, I can't.
How does Eureka act as a metaphor for intellectual works? In the early days of Eureka, crime is a problem
that could only be solved by someone putting in the work needed to get the bad guys off the street. The lack of
law enforcement in Eureka is equivalent to the lack of writing or invention in our world. Both require
individuals to do the work to fix the problem.
Creating intellectual works is a service industry, the way a sheriff provides a service of enforcing the law. The
term "Intellectual Works" reflects the work or labor needed to create the writing or invention.
Do not let someone fool you into thinking that writing and inventing is a manufacturing industry because they
create "Intellectual Property." Intellectual works existed long before the laws came along and allowed them to
be turned into intellectual property.
An intellectual work is intangible. A book is not an intellectual work; the meaning contained in the words is
the intellectual work. The intellectual work in an invention is not the iron and wood of the machine, but the
design and function the machine performs.
Do not commit the logical fallacy of reification, treating an abstract concept as if it were a concrete, physical
thing. The books that carry the words, the machines that perform the functions, are made by printing presses
and assembly lines. Intellectual works are not manufactured things.
3.0.0.1 Intellectual works are abstract ideas created by the labor of human minds. 3.1 Wild Frontier
The story of Eureka starts with no bounty hunters, no bounties, no rewards. Eureka slowly becomes aware of
its distinct problem with crime. And this problem requires a solution.
Our history of intellectual works starts in 1440, with the invention of the Gutenberg press. A scribe copying a
book by hand produced about one book per year. A Gutenberg press produced several hundred books a year.
Literacy rates slowly started going up. People could exchange ideas. This fueled the renaissance, which
started in the 1300's in Italy and in the 1500's in northern Europe. The renaissance was a revolution in science
and art considered the birth of the modern world.
This time was the Wild West of intellectual works. Mankind slowly became aware of its problem with respect
to intellectual ideas. Art and Science became a seemingly endless series of problems to solve.
With this vast, untamed intellectual territory, it seems almost natural that someone like Leonardo da Vinci
(1452-1519) came along and threw himself into a multitude of disciplines. He painted, sculpted, invented and
designed all manner of intellectual works. His disciplines ranged from anatomy to astronomy.
William Shakespeare (1564-1616) is considered the greatest writer in English. His works survive and thrive to
this day.
Inventors up until this time made money as craftsman, not as inventors. A craft, such as shipbuilding, could
take a lifetime to learn, so even if someone knew the idea underneath a new invention, they didn't have the
skill to build it.
Printing presses were becoming common. But literacy rates were still not exceedingly high, so someone like
William Shakespeare paid for the labor of writing his plays by performing them with his theater group.
19

20. The incentive systems at this time were part of the evolution of the crafts and of writing. People found ways to
write and invent and pay for their labor through other means. Writers were paid for their writing by
performing their works. Inventors were paid for their creativity by using their craftsmen skills to build them.
What made this system of incentives start to evaporate was the advent of steam power, the industrial
revolution, and wide-spread literacy. The first industrial steam engine was built around 1700. Craftsmanship
was replaced with mass production. Widespread literacy meant widespread science and scientific papers. The
result of a lot of scientific research might produce its most valuable work in a book and might not translate
well to other forms of employment.
3.1.1 The First Outlaw
The story of Eureka first came to a head when Tinker Tyson started robbing trains. Crime had slowly grown
over time in Eureka. But Tinker Tyson made it abundantly clear that crime had become a problem in the city.
The problem of writing began to show up in the 1600's. Literacy was high enough that there were a lot of
people who might buy books. And with such a potential customer base, the idea of making a living strictly on
your writings had become an appealing idea. The world had reached a point where a learned man could write
a useful book, but had no means of ensuring he could make a living just by selling books.
The problem with inventions began to show up around the same time. The British Empire was built firmly on
its sea power by the late 1600's. Exploration and colonization of the New World was a lucrative business.
However, navigation up to this point could only determine a ship's latitude, not its longitude. Not knowing
your longitude had several expensive repercussions, not the least of which that ships sometimes sank and men
died because they didn't know exactly where they were.
The way crime came to a head in Eureka with Tinker Tyson and his band of outlaws, so too did the need for
intellectual works come to a head with the need for useful books and the need to solve the longitude problem.
3.1.2 The Hostage Scenario
In our story about Eureka, the city could have simply waited for someone to come along and round up Tinker
Tyson for free. There was nothing that would have prevented one of Eureka's citizens to ride into town and
clean up crime. An independent enforcer could have donated his time and energy going around the city,
chasing after the Tinker and his outlaws, and bringing them into justice for free. This individual would risk
life and limb for the benefit of everyone in town.
Should Eureka rely on this happening? Should Eureka rely on some masked crusader saving their town for
free? Or should Eureka create some incentive system to solve its problem with crime? That's the question to
be answered here: What incentive systems should exist in the world?
It turns out that from a game-theory point of view, this is a derivative of a "Prisoners Dilemma" called a
"Hostage Scenario". Imagine a criminal takes a hundred people hostage. He has a revolver with 6 bullets and a
belt of ammo. The criminal makes some demands to the authorities (money, escape, whatever) or he'll kill a
hostage in some time frame (say 2 hours). At this point, every hostage has a 99 in 100 chance of surviving the
next hour of the ordeal.
If one of the hostages decides to take on the the criminal and fight him, that hostage is unarmed and has a 5 in
100 chance of surviving (if they're lucky), and they have a 95 in 100 chance of getting shot before they
overpower the criminal.
The choices are (1) go along quietly (99 in 100 chance of surviving) or (2) fight (5 in 100 chance of
20

21. surviving). With these odds, the individual has a much better odds going along with the ordeal than trying to
fight. The thing is that these odds apply to EVERY hostage as an individual, so every hostage will have a
great incentive to go along quietly and hope they survive.
In our story, Eureka should not sit around and wait for one of its citizens to volunteer to bring in the bad guys.
(side note: It turns out that in a "Prisoner's Dilemma" game, the prisoners can come to a better outcome for
themselves if they cooperate. In a hostage scenario, the odds for fighting back improve greatly if all the
hostages work together and can overwhelm the criminal. There is still individual risk, but as a group, the
hostages have a much better chance to subdue the criminal and win their freedom. If the hostage taker isn't
suicidal and packed with explosives, a coordinated group response can be successful. We'll address this option
later.)
So, what sort of incentive system should exist?
Some incentive needs to exist that would offset the risk that an individual would have to take. In our story of
Eureka, this happens when Mr. Clayton offers Eureka's first bounty.
3.1.3 The First Bounty on Earth
Tinker Tyson was on the loose, killing people and robbing trains. The sheriff was too undermanned to take on
Tyson. Victor Clayton decided to offer a $25,000 reward to anyone who can bring in Tinker Tyson.
The history of intellectual works also has the first bounties for writing and inventions.
In 1710, the Statute of Anne was passed by the British government. It is the first copyright law in human
history. And it rewarded authors with exclusive rights to copy and print their work for twenty-one years,
requiring printers to get the author's permission to make copies of their books. The statute explains its
reasoning for doing this as "for the Encouragement of Learned Men to Compose and Write useful Books."
In 1714, the British government offered a prize for anyone who could design a way to determine a ship's
longitude. The prize was between 10,000 and 20,000 British pounds, depending on how accurate the solution
was. Some people attempted to come up with a solution, but none collected the prize. A clock maker by the
name of John Harrison came up with a solution that would work but required a mechanical clock that was
more accurate than had ever been built before and could operate on the rolling deck of a ship. He started
working on the clock design in 1730. It took him over 30 years to do it, but in 1761, he presented a clock
design that was accurate enough to qualify to win the prize.
3.1.4 Measuring Success (Catching the Bad Guy)
Clayton's bounty was pretty specific. Capture or kill Tinker Tyson and bring his body back to town before the
railroad company stopped train service to Eureka. Whoever succeeded in doing that first, got the $25,000
reward (later raised to $50,000).
The longitude prize was fairly specific as well. Discover a way to determine the longitude of a ship within one
degree.
But how do you define success when the bad guy is unknown at the time you determine the bounty to be
offered? And if you don't know how bad the bad guy is, how can you determine a fair bounty system for all
future criminals?
For criminals, you might be able to create a bounty chart that listed bounties based on the crimes the person is
21

22. wanted for. A horse thief goes for $1,000. A bank robber goes for $2,000. And so on.
For the arts and sciences, you could come up with a chart that paid 5 cents a word for fiction and 10 cents a
word for non-fiction writing. Drawings could get paid $100 per canvas or sheet for art and $500 a page for
technical diagrams. The problem then is that you've set the price, but you have no way of measuring success.
You have no way of determining if the work handed in by the person in front of you is actually worth the 10
cents a page or not.
This actually happens now and then when you hear a story about a government endowment for the arts that
was given to some painter or sculptor. The reason the story makes the news is because the painter took the
money and turned in a white canvas with a black dot in the middle of it. Or the sculptor took the money and
turned in some scrap iron from the local junkyard that he welded together. The local citizens are up in arms
because their tax money went to fund something they think is a waste.
It turns out that the solution to this problem is simple in concept and ingenious in its design.
What the British government did was to turn the endowment for the arts into a voluntary tax system. The
Statute of Anne took an abstract thing that was the writing and ideas in a book, and declared it to be a thing,
the exclusive property of the author. Anyone who wanted a copy of this abstract thing would have to get
permission from the author, which the author would likely grant for a small fee.
The government decided that they didn't want to tax the people and use that money to fund some large and
unwieldy endowment for the arts program. They wisely foresaw the people complaining of all the new taxes
and how the money was being spent on all sorts of stupid books. Instead, the government decided they would
give writers ownership of their abstract work as if it were their exclusive property, and as exclusive property,
the author could then sell copies of the work to readers.
Rather than pay taxes for a massive endowment for the arts program, people would pay money to an author
for a book they wanted to read. The government extracted itself from a lot of headaches and complaints, and
left it to the people to decide if they wanted to pay an individual endowment for the arts by buying a copy of
some author's book.
It was then simply a matter of picking how long was long enough for the book to be treated as the exclusive
property of the author. Up until the Statute of Anne, intellectual works existed only in their natural state as
abstract ideas. The new law would require everyone treat the abstract idea as if it were the physical property
of the author. But this only lasted for a while, and then the legal encumbrances would fall away and it would
be a simple abstract idea again. So the question was how long should an idea be treated like property.
What sort of incentive system should exist?
This is where the bounty hunter metaphor is extremely important. The community decides on some amount
for an award, and then they see if any individuals take them up on their offer. Clayton offered $25,000 to
bring in Tinker Tyson. It turned out that this didn't get anyone who could actually do the job interested in the
reward. So Clayton raised the reward to $50,000.
In 1710, the British government settled on 21 years as being long enough to treat a book as the exclusive
property of the author. After 21 years, the abstract work contained in the book was treated like any other
abstract idea, and anyone could copy it, use it, etc. The author was given 21 years to sell their book, and if
they didn't make their money by that time, they were out of luck.
3.1.5 Winner Take All
22

23. Clayton offered one bounty to the first person who succeeded in bringing in Tinker Tyson. He didn't offer
money for runner ups. He didn't offer money on an hourly basis. It was a winner-take-all contest.
This creates risk for all bounty hunters. Not everyone who starts out looking for a bad guy is going to catch
him and collect the bounty. Some people aren't cut out to be a bounty hunter but have to learn the hard way.
Some people would make a good bounty hunter, but might miss a clue and miss nabbing the bad guy. Several
experienced bounty hunters might be going after the same bad guy.
Only the first person to catch the bad guy gets any bounty.
This is actually a good design element of our incentive system. It encourages people to achieve results
quickly. The first one to get the bad guy wins. Catching the bad guys sooner is better than later, and this
system rewards "sooner".
It also means that failure does not cost the person offering the bounty anything. Clayton offered $25,000
bounty on Tinker Tyson's head. But he didn't have to pay a red cent for the Haskel brothers going after Tinker
stone drunk and getting themselves killed.
The first copyright system worked the same way, offering a 21 year exclusive bounty to the first person who
wrote something. Patent law (which we'll get to later) gives the first person to register a new invention the
exclusive rights to that invention. This gives incentive for people to write and invent new works.
Success is rewarded by sales of the book or invention to the public. Failures cost the community nothing. The
risk is on the authors and inventors to be successful, to create something the public wants. If someone who
can't write worth a hoot keeps cranking out books that no one buys, he is the only one who loses anything.
3.1.6 Cutting Cake for Bounty Hunters
Our incentive system is looking good so far.
Think of a bounty system as a modified cake cutting algorithm.
The cake is community property. The community wants some bad guy caught or some intellectual idea
discovered. The community offers a piece of cake as a bounty to the first person who brings in the bad guy.
The community picks some size as an initial offer and waits to see if anyone collects. If no one collects, the
community offers a bigger piece of cake, and so on, until someone collects.
Since only the first person to catch the bad guy gets the bounty, there is pressure between the bounty hunters
to get the bad guy as quickly as possible, for the lowest price possible, or someone else might take the piece of
cake. But the piece must also be big enough to pay for the time, energy, and expenses to catch the bad guy,
which pushes the size of the bounty to some minimum. But first-success-collects puts pressure on the bounty
hunters to do the job as efficiently as possible, so they can take the first bounty offered and still make money.
The community, obviously, wants to offer as little cake as possible to get the job done.
In the end, the bounty hunter cake cutting algorithm settles on the smallest piece of cake that will get the job
done as quickly and as efficiently as possible.
And the algorithm is robust because it will tend to this solution for many types of individuals for varying
levels of selfishness.
3.2 The First American Bounty
23

24. In 1787, the Constitution was ratified by the states. Section 8 of the Constitution granted Congress the power
"To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors
the exclusive Right to their respective Writings and Discoveries;"
To catch a bad guy ==> To promote the progress of science and useful arts
A bounty shall be offered ==> Creators shall have exclusive rights for a limited time to their works
It was then left up to Congress to determine what rights should be secured and for what duration. Three years
later, the Copyright Act of 1790 granted Authors the right to print and publish their work for 14 years and to
renew for another 14 years. Registration of the Writing with the Library of Congress was required for
protection. The Writing had to contain a Copyright Notice to be protected. (i.e. Copyright 2004 Greg London)
Works that are not registered or do not contain a notice are not protected and remain freely available to
anyone.
3.2.1 Isaac Preston pays a visit to Mayor Maddox.
In our story of Eureka, something goes wrong with the bounty hunter cake cutting algorithm, and it happens
when Isaac Preston pays his first visit to Mayor Maddox. The point of the algorithm is to settle on the lowest
price that will get the job done as quickly and as efficiently as possible.
Isaac Preston, however, was a silver tongued devil, and he convinced the Mayor that the bounty should be
readjusted based on the value of the service provided. The Bennett Boys stole half a million dollars, and Rex
rustled over three hundred head of cattle, so Preston argued that the bounty should be based on the value of
the result, rather than on the amount of work it took Preston to catch the bad guys in the first place.
The original algorithm settled on the lowest price that would get the job done as quickly and as efficiently as
possible. The original algorithm was also robust, and settled on this price even if the players covered a wide
spectrum of morals. The original algorithm was objective: offer a low bounty and then raise it until someone
takes it.
The new algorithm paid more for the job than needed. It still rewarded quickness, but efficiency was no longer
necessary, so Preston had extra money to hire a lot of extra help. The new algorithm was also subjective,
requiring the community to determine the value of catching the bad guy, rather than simply focusing on how
much it cost to catch him. And once any algorithm becomes subjective, it requires some of the players to be
fair and independent, but requiring a player be fair makes the entire algorithm less robust.
3.2.2 The Bounties Keep Going Up
Something like Preston's visit to the Mayor's office happened in the history of intellectual property. There are
several possible events, so I'll skim through the list.
In 1710, the Statute of Anne was passed by the British government. It was the first copyright law in human
history. And it rewarded authors with exclusive rights to copy and print their work for twenty-one years.
In 1790, Congress passed the first copyright law in America. The Copyright Act of 1790 granted Authors the
right to print and publish their work for 14 years and to renew for another 14 years.
In 1831, Congress extends the term of Copyright to 28 years plus an additional 14 year extension, claiming it
matches the protections provided to Authors in Europe.
In the 1880's, Victor Hugo, author of Les Miserables, paid a visit to some government official's office, and
24

25. pushed for the Berne Convention. The Berne Convention was a treaty between a number of European
countries that agreed to recognize copyright protections from member countries. Without such a treaty,
copyright was only a national law, and a work would be under copyright only in the country where the author
lived. The work would be public domain everywhere else.
In 1905, the Berlin Act modifies the Berne Convention to extend the Term of Copyright to the life of the
Author plus 50 years.
In 1909, Congress passed the Revision of U.S. Copyright Act, and the term of Copyright is changed to be 28
years plus an additional 28 year extension.
In 1911, the United States entered the Buenos Aires Convention on Literary and Artistic Copyrights. This is
the first international treaty the the U.S. signs. The Buenos Aires treaty required all works protected by the
treaty to contain a notice proclaiming "All Rights Reserved". (note that this is different than "copyright
notice" which would be something like "Copyright 2004 Greg London").
In 1928, the Rome Act modified the Berne Convention to recognize "moral" rights of Authors. An Author's
"moral" rights included "attribution" (the Author must be given credit for their works) and "integrity" (the
work cannot be modified in a way that might prejudice or harm the Author's reputation).
In 1952, the Universal Copyright Convention (UCC) was adopted at Geneva in 1952 by countries who were
not part of the Berne Convention but wanted some sort of international copyright protection. Members
included the United States, Latin America, the Soviet Union, and some developing countries.
In 1976, Congress passed the U.S. Copyright Act of 1976. This is a major revision to Copyright law in
anticipation of the United States joining the Berne Convention. The Term of Copyright had been 28 + 28 and
is changed to "life plus 50".
In 1988, the United States joined Berne Convention, meeting the requirements of the treaty with the U.S.
Copyright Act of 1976. The Universal Copyright Convention of 1952 no longer applied to U.S. Copyright
law. The Buenos Aires Treaty of 1911 was no longer applicable. The phrase "All Rights Reserved" was no
longer required to secure copyright in the U.S.
In 1993, the European Union Directive on Harmonizing Term of Copyright was issued. The goal was to
ensure that there was a single duration for copyright across the entire EU. The chosen term was that of
Germany, which had the longest copyright term of any EU state, lasting 70 years after the death of the author.
Unlike some other copyright term extension acts, this act restored copyright to works that had fallen into the
public domain in their source countries.
In 1998, the Sonny Bono Copyright Term Extension Act (CTEA) was passed in the United States and
retroactively extended the duration of Copyright from "life plus 50 years" to "life plus 70 years". The main
argument given in its favor was to keep up with the EU Directive on Harmonizing Term of Copyright of 1993.
3.2.3 An Immortal Mouse
The Isaac Prestons of the world keep visiting the Mayor's office, corporate money keeps flowing to politicians
in the form of campaign donations, and copyright terms keep going up.
In 1928, Walt Disney put out a movie called "Steamboat Willie", starring Mickey Mouse.
At the time, copyright terms lasted 28+28=56 years. This meant that the bounty would have been paid in
1928+56=1984. The Mickey Mouse in "Steamboat Willie" would have become public domain in 1984.
25

26. But in 1976, Congress changed copyright law in preparation for joining the Berne Convention and extended
copyright terms to "life plus 50 years". Since corporations never die, corporate copyrights were set at 70
years. This meant that the bounty for "Steamboat Willie" would keep getting paid until 1928+70 = 1998.
But in 1998, Congress passed the Copyright Term Extension Act (CTEA), extending terms to "life plus 70".
Copyright terms for corporations were extended from 70 to 90 years, meaning Walt Disney Incorporated will
keep cashing in on its bounty until 1928+90=2018.
In 1995, the Lobbyist Disclosure Act of 1995 was passed, requiring lobbyists (with a narrow definition of
"lobbying") to report income or expenditure figures. Americans could now find out how much it costs to buy
their government. I mention this because this was passed 3 years before the CTEA was brought before
Congress. And as a result of the Lobbyist Disclosure Act, Walt Disney Corporation reported 2.5 million
dollars in political contributions for 1998.
Political contributions paid by Walt Disney Corporation around the time the Copyright Act of 1976 are not
known and must be left to the imagination.
"I don't know, I can imagine a lot." --Han Solo, Star Wars Episode 4, "A New Hope"
Our bounty hunter cake cutting algorithm has been hijacked. Congress, who sometimes refer to themselves as
"representatives", seems to have forgotten whom they represent. Congress acts as cake-cutter on behalf of the
people, the citizens, the community. The Walt Disney Corporation is a bounty hunter. Congress is supposed to
cut the cake as small as possible until someone takes the bounty. But what has happened is that Congress now
represents corporate interests over the community. The cake-cutter has been bribed by the bounty hunter. The
bounty hunter now selects the size of the bounty through the purchase of a number of politicians.
The bounty hunter gets to cut the cake and eat it too.
As of 2005, Walt Disney Corporation is cashing in on these bounties with revenues around 20 BILLION
DOLLARS A YEAR. Copyright terms have been extended to the point of becoming a form of corporate
welfare, paid for by people who have to pay for works that should have entered the public domain decades
ago.
Congress extends copyright terms so works don't enter the Public Domain. The people have to continue
paying corporations for works that should have become free. Corporations then skim some of that money and
give it to Congress as campaign contributions. No one in this loop has ever been convicted of giving or taking
kickbacks, but that doesn't mean the whole thing doesn't stink like Sam's Slaughterhouse on a hot summer
day.
3.2.4 The Argument Against Life Plus N
The algorithm is to set the bounty just high enough to get one job done.
This means that a bounty hunter has to keep working to make a living.
The algorithm will settle on a price just high enough to pay for the time and energy and expenses to catch the
bad guy plus make a small profit. Competition will drive the bounty down and prevent anyone from making a
gross profit on any single bounty.
Successful bounty hunters should be able to make a living if they keep collecting bounties.
That is not the same as a bounty hunter making a living after collecting one bounty.
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27. The bounty should pay for the time, energy, and expenses of the one job.
For writers, the term should be long enough to pay for the time, energy, and expenses of writing the one work
that gets copyrighted. Successful writers should be able to make a living writing. But that is not the same as a
writer living off of the money from a single book for their whole life.
Terms that last "life of the author plus N years" do not follow this algorithm. In fact, "Life plus N" terms have
several logical flaws in them.
Say someone writes a book when they are 15 years old. And say the average lifespan is 70. The "Life plus 70"
term currently in place would seem to indicate that it will take 125 years for the author to make back all the
time and energy they put into the book. And if it doesn't take 125 years, then why pay so much bounty?
A person who writes a book at 15, spent at most 15 years writing the book, and gets a 125 year bounty. They
get 125 years to pay back 15 years of work. But if someone spent their entire life writing a book, they invested
70 years before they published their work, but then they die the next day and their heirs only get 70 years to
paid back for the work.
15 years of work ==> 125 years of pay
70 years of work ==> 70 years of pay.
That doesn't seem right.
The second logical flaw flaunts the conservation of energy. If it's true that an author needs more than their
lifetime to pay for their time and expenses on a book, then that means that author is LOSING money while
they are alive. They're putting so much time and energy into it that they won't break even until they are dead
and they're great grandchildren are in college.
If Isaac Preston spent a million dollars to catch Bad Bart, and Eureka paid a thousand dollar a year bounty for
him, then it will be one thousand years before Isaac's heirs finally gets enough money to pay for Bart's
capture.
No incentive system can be designed to take so long to pay back a bounty that the bounty hunter dies before
he finally breaks even.
If it really takes that long to break even, then our incentive system will never work. Unless bounty hunters are
all bringing in the bad guys out of charity. And the writers demanding a life-plus-70 bounty are not thinking
about charity. If they were thinking of charity, there are plenty of ways they could give their work away for
free.
The "life-plus-70" proponents aren't concerned with the work they put into their writing or whether or not they
broke even on that writing. They're main concern seems to be summed up well with the phrase, "It's mine!"
Mainly, these authors are committing the logical fallacy called reification. They are relating to an abstract
concept as if it were a physical thing. Intellectual works are abstract. They are not physical objects you can
possess and control. Once someone reads "to be or not to be", even if you wrote it, you cannot force them to
remove that thought from their mind.
Copyright law is needed to give abstract intellectual works some semblance of property-like behavior. But the
U.S. Constitution only allows Congress to pass copyright laws as a bounty for people who create works to
promote progress. So, it only exists as an incentive system to create works, and then the works return to their
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28. natural, abstract, unencumbered-by-law, state.
Relating to an abstract idea as if it were physical property is a logical fallacy. Intellectual works are property
only because the community agrees to treat it as property as a reward for the creator. Creators cannot start
from the premise that intellectual works are like physical property they control completely without ignoring
the fact that it only behaves that way because the community agrees to it as a bounty for the work.
3.2.5 Resetting the Bounties, The Ideal Goal
I would propose a copyright term of 42 years as the bounty for creators.
First and foremost, the cake cutting algorithm for bounties requires the bounty be set as low as possible to get
the job done. This encourages competition, efficiency, and speed. The duration for copyright on a work should
be just long enough to pay for the time and energy it took to write the work plus pay a profit.
42 years seems like it should be long enough for an author to sell his work and have a chance at making a
profit. Taking a story and translating it into all the different medium should be doable in 42 years, for example
taking a novel and converting it into a movie, a TV show, a radio show, a cartoon, and of course toy
merchandising, should be something that can be reasonably accomplished in 42 years. 42 years should also be
long enough that some publisher would be willing to invest in a work while copyright protects it. Certainly, if
terms were extremely short, say, 1 year, then most people would simply wait for the copyright to expire and
get the work from the Public Domain. However, 42 years should be long enough that financial investment in
the arts can succeed and profit.
As it happens, 42 years is the term that the United States had set for its Copyright from 1831 until 1909, or
more specifically terms were set to 28 years plus the option to renew for another 14 years. For almost a
century, artists and authors were willing to create and publish their work for a 42 year term or less.
Works written by Americans during this period include The Last of the Mohicans (1826), The Tell-Tale Heart
(1843), Walden Pond (1847), The Scarlet Letter (1850), The Adventures of Huckleberry Finn (1851), Moby
Dick (1851), Uncle Tom's Cabin (1852), Little Women (1868), The Adventures of Tom Sawyer (1876), The
Prince and the Pauper (1882), An Occurrence at Owl Creek Bridge (1886), A Connecticut Yankee in King
Arthur's Court (1889), The Red Badge of Courage (1895), The Fall of The House of Usher (1834), The
Wonderful Wizard of Oz (1900), Heart of Darkness (1902), The Call of the Wild (1903).
American authors who were willing to write during this period when they would receive a 42 year term for
their works included: Edgar Allen Poe, Louisa May Alcott, Harriet Beecher Stowe, Mark Twain, Herman
Melville, Nathaniel Hawthorne, Joseph Conrad, Jack London, and Henry David Thoreau.
As it happens, some, such as Mark Twain, advocated for longer copyright terms. But what is important to note
is not what Mark Twain wanted to get paid for his work, but what Mark Twain was willing to get paid for his
work. It may also be of interest to note that Mark Twain made a lot of money off of a 42 year copyright term,
but his arguments for a Life-Plus-50 term show that he committed the fallacy of reification, of relating to the
abstract labor of a writer as if it were a physical thing. In a speech to congress, Twain compares an Author's
Copyright to Land or Real Estate owned by the Author.
"I am quite unable to guess why there should be a limit at all to the possession of the product of a man's labor.
There is no limit to real estate. ... Doctor Hale has suggested that a man might just as well, after discovering a
coal-mine and working it forty-two years, have the Government step in and take it away."
Twain starts with the physical metaphor of someone discovering coal on their property, and ignores the fact
that the thing created by a writer is not physical coal but abstract labor. To correct Twain's metaphor, the
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29. author does not own the land. They are rewarded for their labor of digging out the coal. In the same speech,
Twain argues for copyright terms that last for "Perpetuity". You can read Twain's speech here:
http://www.bpmlegal.com/cotwain.html
So, it seems that the current arguments used by Disney and the likes are not new. They are old arguments.
And they are wrong arguments. And they are wrong because they consistently use misleading metaphors that
start with some physical object and end up equating the last payment of copyright, the moment at which the
work enters the Public Domain, with physical theft. Start with a bad metaphor that equates a writer's labor
with a physical thing, and you end up with bad copyright law. Start off with metaphors that equate a writer's
labor with some other labor or service, and you may end up with some sort of Fair copyright laws.
On the other hand, given what Twain himself was willing to write for, given that the man who argued for a
Life-Plus-50 term was not only willing to write for a 42 year term, but also managed to make a lot of money
doing it, it seems that 42 years has shown itself to be a long enough term that authors can be more than
compensated for their efforts. History shows America had a century where the copyright Bounty was set to 42
years and authors were willing and able to successfully collect, to make a living at it, to thrive at it.
There will be current writers out there who will complain about shortening terms to 42 years. Some will fight
it.
But the question for the community is simple: who should be setting the bounty?
Hopefully the community realizes that the community should be setting the bounty, not the bounty hunters.
The algorithm is to set the bounty as low as possible but just high enough to get the job done. The algorithm
does not say set the bounty so high that Walt Disney Corporation makes 20 billion dollars a year in revenue.
If the term is set to 42 years and novels still get written, movies still get created, and TV shows still get
produced, then why pay a higher bounty? Mark Twain was willing to write for a 42 year term, and made an
extremely good career doing so. The point is not what the authors want for their writings but what they are
willing to write for.
Footnote regarding Twain: Twain spoke before Congress in 1906 for Life-Plus-50 copyright terms because
Europe had just started Life-Plus-50 terms during his lifetime in 1880. Congress responded in 1909 by
extending terms from 28+14 to 28+28. America didn't succumb to the Life-Plus-50 term until 1976, when
Disney's Mickey Mouse was getting close to entering the Public Domain and Bruce Lehman was principal
legal adviser to the U.S. House of Representatives committee that drafted the 1976 Copyright Act. Then when
Mickey Mouse was about to enter the public domain again in 1998, Bruce Lehman was the Patent
Commissioner and pushed for the Copyright Term Extension Act of 1998, extending copyright terms
ANOTHER 20 years. Which is what you would expect to happen when the bounty hunters are in control of
setting the bounties.
3.2.6 Resetting the Bounties, The Realistic First Step
The Berne Convention is an international treaty on copyrights, patents, and intellectual works. There are
currently over 150 countries that are signatories to this treaty, including most modern industrial nations. The
Berne Convention sets the minimum copyright term to be 50 years. Changing the treaty would be a massive
international undertaking. Getting the United States (or any single nation) to withdraw from the treaty would
be an equally massive undertaking with international repercussions.
Because of the international inertia in the Berne Convention, I suggest that terms initially be set at the treaty's
minimum duration of 50 years. This can be undertaken on a country by country basis. As one country sets its
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30. terms at 50 years, hopefully that will raise awareness and cause other countries to set their bounties to a more
reasonable term of 50 years as well.
Once most signatories have changed their local terms to 50 years, it should be easier to renegotiate the treaty
itself to set terms to 42 years.
3.3 Galen's Trust and Copyleft
In our story of Eureka, the next thing to happen was that Galen created his bounty hunter trust fund. Galen had
watched Preston push the bounties higher and higher, and Galen knew there must be a way to do it for less.
Galen's Trust Fund is a rough metaphor of the GNU project. The GNU project was started in 1984 by Richard
M. Stallman to create a complete UNIX-style operating system. (GNU is a recursive acronym for "GNU's Not
Unix".)
Leading up to 1984, Stallman had been stymied by the UNIX operating systems available at the time. They
were all available under very restrictive licensing, to the point where you couldn't even fix software on your
own machine without getting permission.
Stallman had the idea of creating a complete operating system that was like UNIX in functionality, but was
completely open in how it worked and had no restrictions like the ones that prevented you from playing with
your own computer.
Stallman introduced his idea and created the GNU-General Public License (GNU-GPL). Metaphorically, this
license is the same as the legal document that created Galen's Trust. The GNU-GPL was a license that people
could apply to their code that would put the code into a "trust" that anyone could draw from. The only real
restriction on this trust is that you couldn't use something from the trust to compete against the trust.
If anyone took code that was GNU-GPL, modified the code, and then distributed the code, the GNU-GPL
required that the person distributing the code had to provide the original source code used to create the
software.
Source code is made up of text files that people type into the computer by hand. Because it is human written,
it is covered by copyright. To execute code, you first have to compile it and turn it into something the
computer can read, called machine code. The variable $total might translate into memory address 492783.
Because compiling strips out all the human readable information, if all you have is machine code, it is
impossible to get back all the information that was in the source code.
GNU-GPL requires that anyone who distributes a derivative of the original must also distribute a copy of all
the source code used to create the derivative. By this requirement, GNU-GPL keeps all derivatives available
to the community so that anyone can play with it.
If someone licenses their source code GNU-GPL, that means anyone can modify it, compile it, execute it, play
with it. But if anyone modifies the source code and distributes the compiled machine code, they have to also
distribute their modified source code under the GNU-GPL.
Once source code is licensed under the GNU-GPL, it enters a "community trust fund" of sorts, where anyone
can play with the code, even modify it, but the modifications have to be made part of the community trust
fund as well.
This characteristic of the GNU-GPL is called copyleft. The work, and all its derivatives that get distributed,
become community property.
30

31. Because GNU-GPL requires that the source code be made available for any derivative that gets distributed, it
is sometimes called an "Open Source" license.
Imagine Garrett releases some software under GNU-GPL for tracking bad guys and bounty accounting
(Eureka has to hit the electronics age eventually). Anyone can play with this software, use it, etc. Say Preston
gets it, and modifies it to use it in some of his software. If Preston tries to sell a compiled version of his code,
he must make the source code, including any changes he made, available under the GNU-GPL. This means
Garrett can use the modifications that Preston made. This means that Preston's software won't be any better
than Garrett's software. This means that Preston can't use Garrett's software to make something slightly better
and compete against Garrett's version of the software.
The GNU-GPL allows someone like Garrett to sell the software, but it prevents anyone from monopolizing
the software that they sell.
There is no real-world metaphor that is an exact fit for describing copyleft. Copyleft keeps the work in its
natural, abstract state, rather than letting someone use the bounty system of copyright and patent to turn it into
something that behaves like property in the eyes of the law. Since any real-world metaphor will be based on
some physical, real-world object, any such metaphor will have some problems describing the complete nature
of copyleft.
Which isn't to say we shouldn't try, but just to keep in mind that any metaphor will fall short of a complete
description.
One metaphor often used to describe the GNU project is a "barn raising", but barn raising's don't catch bad
guys. So I had to defer to a trust fund for a community of bounty hunters. The bounty hunter metaphor is
specifically in answer to the question "What sort of incentive system should exist?"
Later, I'll introduce a better metaphor specifically for modeling the abstract characteristics of intellectual
works and how that would look in relation to someone like Preston and someone like Garrett.
3.3.1 The Hostage Scenario
The original setup for Eureka was a variant of the Prisoner's Dilemma called a "Hostage Scenario". The game
theory chart for a hostage scenario gives low risk for doing nothing and going along with the hostage taker
and a high risk for fighting the hostage taker.
Intellectual works at the beginning of our story have a similar setup. If someone invests a lot of time, work,
and energy and creates some new intellectual work, they have no natural way of making that investment back,
and everyone benefits. Copyright and Patent laws create a legal incentive system to make it worth an
individual's effort to risk creating something valuable.
But there is another alternative. In a Prisoner's Dilemma, another solution is for the prisoners to cooperate
with each other and work together. In a Hostage Scenario, if all the hostages rise up together against the
hostage taker, they have a higher chance of subduing the hostage taker.
With intellectual works, there is a solution involving cooperation of the people. Rather than having one
individual take a huge risk, many individuals work together, taking small risks, for a large payoff.
The metaphor to describe this situation is a Barn Raising. All the individuals in a community come together,
contribute a small amount of their time and energy, and create something that no single individual could have
accomplished in any reasonable time.
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32. The only difference is that with a physical barn raising, the payoff often goes to the one individual who needs
it, and the rest of the community is repaid when they need a barn.
With an abstract thing like intellectual works, the community comes together to contribute some of their time
and energy to create something that no single person could have done on their own, and create something that
the whole community benefits from immediately.
3.3.2 An Alternative Incentive System
Barn Raisings are an incentive system. Rather than create a reward or bounty for a single individual big
enough to pay for all their expenses, a barn raising lowers the expenses per individual to the point where the
cost per individual is low enough that it can be part of their "surplus".
A simple game theory of economics has individuals coming together, all of whom create something they need
plus a surplus that they can sell to others. The baker makes enough bread for himself and plenty more to sell
to the townspeople. The blacksmith creates things made out of iron and sells his surplus to everyone else.
When the baker sells his surplus to the blacksmith and the blacksmith sells his surplus to the baker, that
becomes a win-win situation.
Barn Raisings rely on individuals to contribute some of their surplus time, energy, tools, and/or materials to a
community project. For a project that literally raised a barn, individuals who donated their surplus to another
individual might do so out of a long-term attitude that they will get a barn built for them by the community if
it comes time that they need one. Or they might simply do so out of a generous spirit.
For the barn raising project that is Linux, the contribution per individual can be low enough that people can
contribute to the project even while holding a full time job unrelated to the project. Since everyone benefits
immediately, the incentive does not usually rely on the "I'll get paid back when I need a barn", because
everyone gets a copy of Linux.
Instead, the incentive is often that the people contributing to Linux love programming, with the functional
payoff that everyone can get a copy of the useful code. A secondary effect that amplifies this incentive is the
acknowledgment that comes from writing code that huge numbers of people will use. Pride in workmanship
encourages people to contribute the best code because it will then be used by more people, giving the
contributers more incentive.
It is an incentive system that thrives on nothing more than personal contribution directly. Only secondarily
does it rely on economic incentive, which can occur when someone who contributes great code is hired to
customize it or change it or alter some in house software to use it.
Historically, barn raisings have been rare or of a limited scope. There are a number of gift economies that
have been established around physical objects, but usually within a limited community size. Linux is the first
planet-wide gift economy. And it is made possible because the cost to contribute to the project is low. Most
programmers own a computer and internet connection at home, so the equipment is a sunk cost. All they need
to contribute is their time and brainpower. The world wide web makes wide and cheap distribution possible. If
Linux were restricted to a paper-only distribution system, the cost of distribution would make it impossible to
be a sustainable gift economy.
The way that printing presses made it possible for people to make a living as authors, the information age
(computers plus internet) made it possible for people to contribute to massive barn raising projects such as
Linux.
3.3.3 Galen's Trust Competes with Preston Corporation
32

33. As Galen's trust fund grew, it had the effect of allowing people who had the skills but not the equipment to
compete for bounties. Competition was good for the community because it pushed bounties down. But rather
than focus on making itself faster and more efficient to win bounties, Preston Corporation instead staged a
multi-pronged attack on the competition, visiting the mayor's office again, and bad-mouthing Galen's trust
fund, among other things.
In 1991, Linus Torvalds released the source code for a UNIX-style kernel. A kernel is basically the
brain/switchboard of an operating system. A working kernel made a complete operating system enter the
realm of possibilities. Making a complete operating system became an idea "crazy enough to work". Linus
called his operating system Linux. The code was released under GNU-GPL, and people started working on it.
Linux became popular for web servers because web servers didn't need all the fancy application software like
word processors, spreadsheets, and the like. Web servers only needed to serve web pages. And to be a
web-based company you needed a lot of computers and software for each computer. And because Linux was
free, it was popular for web servers. Zero cost and a lot of functionality.
In the 1990's, Microsoft sold web-serving software on a per-computer basis. If it cost N to put software on one
computer it cost 10xN to put software on 10 computers.
In the 1990's, Linux, which was available for free, was starting to compete with Microsoft's commercial
software.
3.3.4 The Halloween Documents
By 1998, Linux was competing with Microsoft server software enough that some internal memos got passed
around at Microsoft that talked about how to kill Linux. The memos were leaked and posted on the Internet.
The memos were confirmed to be valid. And because they were posted on October 31, 1998, they became
known as the "Halloween Documents".
In the "Halloween Documents", employees of Microsoft Corporation acknowledge that Linux was
successfully competing against their commercial software, and they discussed, among other things, the best
way to stop Linux. To quote:
"Open Source Software (OSS) projects have been able to gain a foothold in many server applications because
of the wide utility of highly commoditized, simple protocols. By extending these protocols and developing
new protocols, we can deny OSS projects entry into the market."
A "commodity" protocol simply means a free protocol, one that anyone can use. When two computers need to
communicate data, they can do so with many different protocols. Some are freely available and anyone can
use them. Some are patented or proprietary in some way and people have to pay money to get a license to
follow that protocol.
Although there were freely available protocols to handle most of the things you might want to do with a
computer, Microsoft realized that if they came up with a patented or proprietary protocol, Linux would not be
able to afford to purchase the rights from Microsoft to use their proprietary protocols.
The incentive system for Linux relies on lowering the cost that an individual needs to contribute for the
project as a whole to have a successful payoff. By creating proprietary protocols, Microsoft realized that it
could possibly raise the cost for Linux to succeed beyond what individual contributers could afford.
In our story of Eureka, Preston reacts to competition from Galen's trust fund by getting the mayor to allow
bounty hunters to purchase exclusive bounty rights to land. By raising the cost to stay in business, Preston
33