[p2p-research] Fwd: Dual Licensing of Research in Renewable Energy

Wed Jun 17 08:13:43 CEST 2009

Hi Austin,

I just want to add that I wholehearted agree with Sam's assessment here,

this is really the gist of it, that continued use of IP and enforcement has
become counterproductive in the new alignment of peer production and open
manufacturing,

Michel

On Tue, Jun 16, 2009 at 9:52 PM, Samuel Rose <samuel.rose at gmail.com> wrote:

> A few thoughts:
>
> On Tue, Jun 16, 2009 at 5:00 AM, Austin <brentley at gmail.com> wrote:
>
>>  Hello Michel (and hello to fellow collaborators),
>>
>> That is a good question.
>>
>> I think the main issue with dual licensing (DL) is enforcement.  This is
>> easy enough to accomplish when you're comparing lines of code between the
>> commercial version and the original version of a FOSS project.  In fact,
>> there are even programs out there that can tell you exactly what percentage
>> of your original work is in future derivatives.  This seems like it would be
>> harder to do with research, technology, and other forms of IP.  For example,
>> let's say I create a open prototype of a fuel cell.  I give it to the
>> community for improvements and collaboration.  A manufacturing firm uses
>> many different aspects of the original design to create a product for
>> market.  How do I track this (especially since they might never contact me
>> prior to production).  And how can I prove ownership (or at least the
>> community's ownership)?  If this were strictly FOSS, I probably wouldn't
>> mind as much...free riding is actually central to open-source, and I only
>> need a small percentage of commercial products to cover the minimal expenses
>> of designing the code.  In other words, I might not always mind if some
>> commercial vendors choose to cheat the system and not create a DL agreement
>> with me when they use my source code.
>>
>
> There is an emerging mindset in "open manufacturing" thinking (at least, it
> is emerging within me :-)  ): that if an approach is prohibitively
> expensive, you do not settle on that approach. So, if it is prohibitively
> expensive to track ownership of your creations, then you do not base your
> business and revenue models on tracking and enforcing IP.  By not taking on
> that impossible expense, you've now freed yourself and your resources up to
> have the amount of capacity needed research, develop and construct without
> the overhead of enforcement. Here is the secret:
>
> If your business model is based on finding and filling emerging niches, you
> will never need to *worry* about enforcing your IP, and you would actually
> benefit from mutiple participants downloading and using, provided they are
> willing to share. I would avoid DL altogether, and instead release under a
> "copyleft" style approach that keeps the IP in a commons-based system in
> perpetuity. Then, the R & D costs are distributed among everyone who
> participates in research, development, and ongoing release. The business
> model of most participants in this system is already shifting from mass
> production to being able to serve emerging niches, which mass producers
> cannot do.
>
>
>
>
>>
>>
>> While FOSS can use DL quite easily, I'm not 100% sure that this can be
>> applied to other types of innovation.....Open design often has more
>> significant expenses, depending on the industry (my paper is on renewable
>> energy).  CAD software, theory, computers, and internet connections are all
>> quite cheap, but wind turbines, solar cells, and associated lab equipment
>> often require significant R&D inputs for which one would need generous
>> funding.
>>
>
> This again is based on traditional approaches, which are based on
> traditional business models. It is now possible to do the physical
> production part, the equipment part, for as much as 10 times less than
> traditional costs. It requires that you change your thinking and
> assumptions.
>
>
>
>> Currently, only universities and research parks are able to achieve the
>> budgets and economies of scale necessary for some energy-related projects.
>>
>
> I think you'd be surprised at what can currently be done with biomass,
> small scale wind, and solar, when power production is distributed.
>
>
>
>> I'm quite new to open source and P2P, but in my perfect world, there would
>> be some centralized research entity
>>
>
> In reality, over the next 5-7 years there will be many that emerge. Open
> manufacturing is emerging on local scales in the global system. much of the
> development is tied to situational or localized problems. This trend will
> continue. I predict that those who try to centralize aspects of open
> design/open manufacturing will go extinct, and be outperformed by those that
> do not in many cases. Centralization best serves mass production. But, open
> manufacturing is trending towards flexible fabrication, and mass
> customization. Mass production tends to need mass media to create mass
> demand to sustain revenue, plus creates massive amounts of phsyical waste.
> In centralized systems like this, it is tough to change as needs change. it
> is expensive, and the end result rarely is able to meet all needs on local
> levels.  Open design, open manufacturing approach, with no enforcement of
> IP, with no centralization of research and development, finds local niches,
> meets their needs, and thereby creates new niches to be filled. This is how
> it is already working now.
>
>
>> (initially funded by investors and eventually sustained by
>> royalties)...surrounded by a global network of garage and basement
>> contributors who shared their individual findings.  And in my even more
>> perfect world, the license would be ex-post, meaning that only successful
>> products actually generate royalties (meaning there is no risk to use the
>> research...you only pay if you are commercially successful...this would
>> further lower barriers to entry and more companies could race to bring
>> commercial products to market...which is great for end-users).
>>
>
> If IP is already pooled and collaborated upon, then it makes more sense to
> shift the business model from controlling IP to the point of consumption,
> where you make what people need as they need it, and pool the designs with
> others. The more you pool, and the less you track and enforce, the more
> chances everyone has of being able to identify and meet emerging local needs
> (local to your network, which could be anyone you are connected with
> globally, or people that are physically local). Again, this is because
> enforcement of IP is fruitless. Wealth creation can be exponentially
> increased by shifting the business model to the point of consumption, and
> away from controlling/enforcing IP. Pool the IP, since mass
> production/consumption is decreasing and will decrease, no one design will
> be a "goldmine". This is what I call a "Commons-based business model". This
> is how it is working in practice right now for most that are successful in
> the open manufacturing realm. This is also the successful business model for
> open source software. There are also some things that you are probably not
> aware of about approaches to research and dev that help bolster the
> commons-based business model approach.
>
>
>
>
>>
>>
>> The problem is tracking, enforcement, and litigation.  How do we ensure
>> that manufacturers comply with the DL arrangement....especially if the
>> royalty is only after the fact.  The goal is to keep legal fees to a minimum
>> which means that IP and derivatives must be unambiguous, easy to compare,
>> and transparent.
>>
>> Hope this clarifies things.  I also created an online powerpoint
>> presentation (15 slides or so) to show my supervisor.  This might further
>> clarify what I hope to achieve:
>> http://docs.google.com/Presentation?docid=dcdkrjn7_0dj22q9gn&hl=en.
>>
>> Depending on the responses I receive, my research will focus on the
>> critical success factors of this project (what will it take to make it
>> work)....or, it will focus on buy in (would investors, institutional
>> scientists, freelance scientists, and renewable energy manufacturers want to
>> participate in such an project).
>>
>
>
>
>
>
>>
>>
>> Thanks to you all.  So strange that I started off focusing exclusively on
>> renewable energy, but now found myself becoming a novice patent researcher.
>>
>> Thanks Michel and Community,
>>
>> -Austin
>>
>> BTW, do you all already have an online forum where I could simply create a
>> conversation thread....I don't want to flood anyone's inboxes....and those
>> who contribute can build on what others have said.
>>
>>
>>
>>
>> Michel Bauwens wrote:
>>
>> Dear friends,
>>
>> Thanks for reading through this request/proposal of a new funding
>> mechanism for open hardware research
>>
>> Austin, a little question. Since dual licensing works with FOSS, and is at
>> the basis of different open source companies, why would it not work, or work
>> differently with open design, since that is equally an immaterial process?
>>
>> Michel
>>
>>
>>
>> *From:* Austin <brentley at gmail.com>
>> *To:* michelsub2003 at yahoo.com
>> *Sent:* Thursday, June 11, 2009 1:38:47 PM
>> *Subject:* Dual Licensing of Research
>>
>> Hello Michel,
>>
>> My name is Austin and I recently came across your article (
>> http://www.we-magazine.net/we-volume-02/the-emergence-of-open-design-and-open-manufacturing/)
>> concerning open manufacturing..  I found this piece very encouraging since
>> over the past several weeks, I have been outlining a research paper for
>> school in which a self-sustaining business model could actually help speed
>> up R&D in the renewable energy sector.  I realize, after reading your
>> article, that my business model is not nearly as "new" as I had previous
>> believed....although my approach has a few key differences.
>>
>> I can only imagine how busy you must be, but I was hoping you might
>> provide some clarity concerning dual licensing in an open innovation
>> business model.  I think a very brief background on the actual idea might
>> make my questions easier to frame.  the basic components are:
>>
>>
>>    - Investors pool money into a research firm (we'll call it Green R&D)
>>    - Green R&D works exclusively on renewable technology.  They pay for
>>    the labs, scientists, etc.
>>    - The research is posted online periodically so that anyone and
>>    everyone can contribute, ask questions, make recommendations etc....the
>>    information is essentially in the commons under a "public" license of
>>    sorts..
>>    - Solar panel or Wind turbine companies can use this growing body of
>>    research to bring products to market.
>>    - Green R&D receives an ex post royalty (under a dual license) from
>>    any successful products created by these solar panel and wind turbine
>>    companies.
>>     - Green R&D pays out dividends to initial investors and/or uses these
>>    royalties to fund additional research.
>>
>> Energy companies have lower R&D costs since they benefit from Green R&D's
>> public findings.  Innovation happens more quickly since the silo effect has
>> been removed.  You still have market incentives (which help to pay for the
>> research equipment).  And Green R&D only needs a few innovations to actually
>> come to market...kind of how only a fraction of dual licensees in the open
>> source world end up funding the entire Innovation Pool for everyone else (as
>> you mentioned).
>>
>> As you can see, this model bears some similarities to the community-based
>> innovation you discussed in your article....but as I mentioned, there are
>> some major differences as well.
>>
>> This is the starting point of my research paper, but I've run into some
>> difficulties...namely, measuring, monitoring, and enforcing the
>> collaborative IP created under such a framework.  Dual-licensing is easy to
>> implement in the digital world since source code can be monitored, tracked,
>> and segmented.  Not so with research and other forms of technology.  As you
>> pointed out, the manufacturing world (and to a lesser extent the research
>> world) requires capital outlays that don't necessarily exist in open source
>> communities.  Do you believe that dual licensing could work under the
>> business model outlined above?
>>
>> Anyway, thanks in advance for any insights that you might be able to
>> offer.  I'm a latecomer to the P2P, open source, and collaborative genres,
>> but I really applaud what you are doing.
>>
>> Many regards,
>>
>> -Austin
>>
>>
>>
>>
>
>
> --
> Sam Rose
> Social Synergy
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>
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>
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