The issue is the following this free (as in free speech) but also zero dollar approach, centered around common value production, does not have it’s own means of sustainability. And critically, advertising will not be able to fill the enormous gap between the exponential rise in common value production, and the linear monetization of attention through advertising. Also, critically, we do not (as yet, and perhaps never), live in a society which has a clear mechanism for funding common value production.

So what needs to be done.

Here are the steps in Steve’s reasoning.

1) Differentiating between open and closed content/code/design, and free/paid approaches, yields for quadrants
a) Open and free: you can download content, software code or open designs for free; and the more successfull of these initiatives will derive income from advertising, selling the attention. The problem remains that many will not be able to do this

b) Open and paid: why would you pay for open code; the short answer is you wouldn’t, unless it is augmented by differential value that is scarce and also useful in your particular context; in this context you are paying for these added value practices that come together with the free code, not the code itself

c) Closed and free: this is a classic commercial strategy; you give the primary commodity for free (say, free cell phones), because it helps you to sell secondary commodities (say mobile phone connectivity)

d) Closed and paid: the classic business model that we are all familiar with and that relies on state-protected intellectual rights monopolies. This is the model that is being most severely undermined by the free replicability of information. This means that it is not just the hackers and consumers that threaten such a business model, but your own competitors. In any sector, there will always be a pioneering company that decides to give the primary commodity for free, or gives away the source code, deriving income from secondary modalities, leaving the traditional closed rights holders in the cold, and making this model unsustainable in the long run.

Summarizing an important point insight from Steve: 1) entities in the open and paid quadrant live from their Practices; 2) entities in the closed and paid live from their intellectual Assets; 3) and entities in the closed and free quadrant live from their Portfolio of secondary services.

To the topic of making the open and free design model sustainable, Steve adds that the only sectors which can do this consistently, will be the public and nonprofit sector, who have a generalized income that makes it possible. That means that, in the absence of a generalized income for common value production, the open and free sector, must somehow move closer to open and paid.

The key issue, if we do not want to kill off the open and free availability of content/code/design, is to differentiate between the immaterial production of the design, and the material production of the objects.

This is precisely what Marcin Jakubowski is trying to realize with his Factor E Farm project, and the very reason I have called it the most important social experiment of our time.

Marcin’s first realization, the CEB machine code-named, “The Liberator” http://openfarmtech.org/index.php?title=CEB_Press

Steve, echoing Marcin, stresses the radical competitive nature of such a project, because only the labour needs to be paid in an open source design project, such products can compete even with Chinese and Burmese slave labour. That labour needs to be paid only once, since the result is always available to all.