Articles by Tim Lee

Timothy B. Lee (Contributor, 2004-2009) is an adjunct scholar at the Cato Institute. He is currently a PhD student and a member of the Center for Information Technology Policy at Princeton University. He contributes regularly to a variety of online publications, including Ars Technica, Techdirt, Cato @ Liberty, and The Angry Blog. He has been a Mac bigot since 1984, a Unix, vi, and Perl bigot since 1998, and a sworn enemy of HTML-formatted email for as long as certain companies have thought that was a good idea. You can reach him by email at leex1008@umn.edu.


eBay for Black Hats?

by on December 16, 2006 · 10 comments

What do y’all think about this? (courtesy of Slashdot)

Underground hackers are hawking zero-day exploits for Microsoft’s new Windows Vista operating system at $50,000 a pop, according to computer security researchers at Trend Micro. The Windows Vista exploit–which has not been independently verified–was just one of many zero-days available for sale at an auction-style marketplace infiltrated by the Tokyo-based anti-virus vendor. In an interview with eWEEK, Trend Micro’s chief technology officer, Raimund Genes, said prices for exploits for unpatched code execution flaws are in the $20,000 to $30,000 range, depending on the popularity of the software and the reliability of the attack code.

This feels kind of bogus to me. I’m sure there are lots of people trading Windows exploits on the Internet, but who would pay $50,000 for such an exploit? And if there were people paying $50,000 for Windows exploits, I would expect them to be extremely nervous about being caught by law enforcement agencies. Which I expect would cause them to shun online auctions, which by their nature involve exposing your activities to a large number of other people.

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Forrester Bashes DRM

by on December 15, 2006

Marketplace had a segment this evening in which Josh Bernoff of Forrester argues that iTunes DRM is hurting the music industry’s bottom line. If they’d called me, I could have told them that a year ago.

Anderson on the Evolving Web

by on December 15, 2006

Chris Anderson has a great two part series on the future of the Wired website. I thought this snapshot of the evolving conventional wisdom with regards to website design was particularly interesting:

THEN: Bookmarks and habit drive traffic to the home page; site architecture and editorial hierarchy determines where readers goes next. Portals rule. NOW: Search and blog links drive readers to individual stories; they leave as quickly as they come. “De-portalization” rules. THEN: Media as Lecture: we create content, you read it. NOW: Media as Conversation: a total blur between traditional journalism, blogging and user comment/contributions.

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In a comment on Wednesday’s post on software patents, Patrick Mullen offers the following argument:

I think patents actually make it harder for companies like Microsoft and Apple. You can be the best programmer in the world and write the best program ever, but if a company with the resources of Microsoft has the ability to copy your program, who do you think will have the market share? Do you think you would stand a chance against their marketing machine?

I would find this argument more persuasive if there weren’t so many counterexamples. Let’s start with Google. They entered what everyone thought was a mature industry in 1998 and created a $150 billion company in under a decade. Yahoo and Microsoft did their best to copy the technology, but they were unable to stop Google’s momentum.

Or take YouTube. Google–by 2005 a large company with deep pockets–actually beat YouTube to market with a flash-based video site. Yet YouTube surged past them, and after 18 months they had beaten the company so soundly that Google was forced to shell out $1.5 billion to buy them.

There are plenty of other examples: MySpace, FaceBook, Flickr, Hotmail, Digg, and probably hundreds of smaller firms I’m not thinking of. Most of these had big companies try to replicate their success. And in most cases, those efforts failed miserably; the competing products weren’t as good, or couldn’t generate the buzz of the original. As far as I know, software patents were not an important component of any of these startups’ business models.

Now, of course some small companies have been crushed by larger rivals. Netscape is the obvious example. Kiko is arguably another. But it’s not clear to me why we should consider that a problem. One of Netscape’s big problems was that Netscape version 4 sucked, and then they took 3 years to release an even more sucky version 6.

As Mike Masnick emphasizes over and over again, it’s a good thing that companies have to keep innovating if they want to succeed. Giving a company a patent that guarantees it a lock on a particular market simply reduces their incentive to keep improving the product. That doesn’t seem like good policy to me.

A Jobless Future?

by on December 15, 2006 · 4 comments

Ezra Klein worries about the perils of robotics to the labor market:

Soon enough, according to Bill Gates, we’ll all have personal robots. The precise implications of a transition to an economy largely run by hyperpowered, anthropomorphic machines is, obviously, unclear. It’s pretty safe to assume you’ll see a lot of occupational displacement, and at a point, you’ll see more than can be effectively made up. Was Marx right, but we had to wait for robots? Maybe. Workers of the world unite, you have nothing to lose but your usefulness!

This gets economics completely backwards. The purpose of an economy is to produce wealth, not jobs. Jobs are the unpleasant tasks we have to perform to get the wealth. If we can get wealth without jobs, that’s an unambiguous improvement. Only decades of demagoguery about “creating jobs” makes it possible for people to get that so backwards.

The more wealth there is in the world, the easier it will be for you to get some of it. Robots would only accelerate the accumulation of wealth, thereby increasing the amount of money a worker is likely to be able to get for a given unit of his labor. True, his wages might shrink relative to the overall economy, but he’ll only get more productive as technology improves, so in absolute terms his wages will only go up.

But what if the robots are better than the people at absolutely everything? Here, we have to bring in the concept of comparative advantage. Even if robots are better in absolute terms at everything, humans will always have a comparative advantage at something. The classic example here is a lawyer and his secretary. The lawyer might be better than the secretary at absolutely everything. Yet the secretary is still useful, because the lawyer might be 100 times as good as the secretary at practicing law, but only twice as good at making photocopies. Therefore, it still makes sense to hire the secretary to make photocopies so the lawyer can devote his energies to practicing law.

Every week, I look at a software patent that’s been in the news. You can see previous installments in the series here. This week, we’ll consider this patent, “Computer controlled video system allowing playback during recording,” which a company called Forgent apparently believes entitles it to royalties from the PVR industry. Here is the abstract:

A teleconferencing system with capability to store incoming multiple medium messages for later retrieval and playback is disclosed. The system includes a communications multiplexer which, in normal mode, receives the incoming message and routes the message to various output functions, including video, audio, and computer display. In store mode, the communications multiplexer receives the incoming message and communicates it to disk storage, for example by way of direct memory access. During playback, the communications multiplexer receives data from the disk storage, and controls its communication to the various output functions, in the same manner as during receipt of a normal incoming message during an interactive teleconference. As a result, multiple medium messages may be stored for later retrieval, with the playback appearing in the same manner as a conventional teleconference message.

This patent covers a device that’s capable of recieving, storing, and displaying various types of data. Unless I’m missing something, such a device is generally known as a “computer,” and I’m pretty sure that computers capable of manipulating audio and video content were invented well before 2001.

Moreover, almost all of the features described in this patent are core components of any modern operating system. Modern operating systems are adept at accepting data from a variety of different sources and routing them, as appropriate, to storage or to output devices. Using a technique called “multitasking,” they can store one file to disk while simultaneously streaming another file to an output device.

Once a general-purpose technology (like data storage and retrieval) has been invented, straightforward applications of that technology (like video storage and retrieval) are clearly obvious. I mean, once somebody has invented the hammer, we wouldn’t grant a patent on using that hammer to pound a particular kind of nail, would we?

Update: Incidentally, Forgent appears to be something of a patent troll. They’re the same company that claimed back in 2002 that they owned a patent covering the JPEG format. Forgent settled in one such case back in November.

Bill Gates’s thoughts on DRM, courtesy of a rough summary by Michael Arrington:

Gates said that no one is satisfied with the current state of DRM, which “causes too much pain for legitmate buyers” while trying to distinguish between legal and illegal uses. He says no one has done it right, yet. There are “huge problems” with DRM, he says, and “we need more flexible models, such as the ability to “buy an artist out for life” (not sure what he means). He also criticized DRM schemes that try to install intelligence in each copy so that it is device specific. His short term advice: “People should just buy a cd and rip it. You are legal then.”

Keep in mind that Gates heads a company that has an R&D budget in the billions, and they’ve been trying to do DRM right for close to a decade now. Yet he frankly admits that all the money has been for naught. A decade from now, people will look back at the DRM and e-voting fads of the ’00s and ask “what were we thinking?”

Leahy’s Agenda

by on December 14, 2006 · 2 comments

A friend sent me Sen. Leahy’s speech on his agenda for the upcoming Congress. I don’t agree with all of it, but it looks like it’s mostly positive. He wants to strengthen oversight of law enforcement agencies, strengthen the Freedom of Information Act, and defend the judicial independence. Here’s what he had to say on NSA spying:

For years, this Administration had hidden the “President’s program” of warrantless wiretapping of Americans. We are now beginning to learn that it was not just one program but many that have been hidden from Congress. We all support monitoring the communications of suspected terrorists. Doing that is basic to thwarting terrorism. It is essential, and it is permitted under existing law. It is also essential that when that monitoring impinges upon the rights of Americans, it needs to be done lawfully and with adequate checks and balances to prevent abuses. Initially the Administration stonewalled our inquiries and claimed unilateral power and a monopoly on deciding what needs to be done and how to do it. As we pressed for answers, their responses turned into a demand for sweeping legal authority without any independent judgment by Congress, or any meaningful answers about what they have been doing. We came together in the days after 9/11. We worked together to provide new authority the Administration said it needed. But after White House unilateralism set in, they have claimed for themselves broad authority to violate the law and secretly eavesdrop on American phone and computer communications, without proper congressional or judicial review. That is a recipe for abuse. The reason we have the Foreign Intelligence Surveillance Act–or FISA–in the first place is because of a period of earlier abuses of Americans’ rights and privacy. With meaningful oversight and cooperation from this Administration we can achieve the right balance. We all have the same goal–protecting our country and its citizens. We have made more than a dozen changes to FISA since 9/11. If FISA needs more changes, then we should work together to achieve that in a responsible way, once Congress has a basis in knowledge that justifies further changes.

This sounds good, although I wouldn’t be shocked if Leahy caves to the administration the way Specter did. And Leahy mentioned patent reform:

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I’ve found that defenders of software patents tend to focus their energies on debunking common arguments against software patents. They never seem to get around to explaining why software patents are a good idea to start with. Solveig’s Singleton’s paper fits with this trend. Here’s the closest she comes to describing the benefits of software patents:

Early on, software was often parceled out along with hardware; trade secret offered protection; the cost was, due to lack of disclosure, some clever ideas have een lost. Then it became generally accepted that software would be protected by opyright. This works well against some types of copying (for example, counterfeiting) and for some types of programs (for example, games). But patents were seen as providing more certain protection against the copying of the function of a program more broadly (“look and feel” cases that sought to broaden copyright protection being problematic). The term of protection for copyright is unnecessarily long for software. In theory, patent law would extend protection only to the non-obvious and novel. That together with software’s technical nature seemed a good fit with patent law.

It’s certainly true that patents provide “more certain protection against the copying of the function of a program more broadly.” But it’s far from obvious that “protection against copying” is always desirable. Outside the patent context, such copying is often known as “competition,” and public policy generally aims to enhance it. I’m glad that Microsoft copied Apple’s operating system, Netscape’s browser, and Google’s search engine. It’s been good for me as a consumer. It’s not obvious to me what purpose is served by making it harder for companies to copy the broad features of each others’ products.

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Better than Ever

by on December 13, 2006

Kirk Douglas warns young people that the world is going to hell:

THE WORLD IS IN A MESS and you are inheriting it. Generation Y, you are on the cusp. You are the group facing many problems: abject poverty, global warming, genocide, Aids, and suicide bombers to name a few. These problems exist, and the world is silent. We have done very little to solve these problems. Now, we leave it to you. You have to fix it because the situation is intolerable.

My old boss David Boaz sets the record straight:

let’s take a closer look at the problems the long-lived actor identifies. Abject poverty? Sure, but nothing like 1916, when Douglas was born. The percentage of people who are “absolutely poor” has fallen from 80% of the world’s population in 1820 to 50% around Douglas’s birth to just over 20% now. The average person in the developed world has a real income about five times as high as the average person 50 years ago. People in India and China have mostly – though not all – moved out of the back-breaking poverty that their ancestors knew for centuries. In America’s inner cities, the level of actual deprivation is far less than in generations past, though hopelessness and despair remain serious challenges… Since ancient times people have worried that our best days were behind us, that things were getting worse, that we were running out of resources, that our morals had declined. And yet, at least since the rise of liberalism and the Industrial Revolution, the statistics tell us that things are getting better, that – as the subtitle of a new book puts it, “we’re living longer, healthier, more comfortable lives on a cleaner planet.” Somebody needs to send Kirk Douglas a copy of that book, The Improving State of the World by Indur Goklany.

Amen to that.