21LHtzUfbpL._SL160_.jpgIn January 1773, Wolfgang Amadeus Mozart placed advertisements asking patrons to “subscribe” to the three piano concertos he was writing. If he received enough support, the concertos would be finished by April, and subscribers would receive beautifully copied manuscripts. More importantly, they would have the pleasure of supporting the creation of a great work, which would be performed around the world. The resulting concertos, K413-415 are today considered important works, but it took quite a long time for Mozart to gather enough subscribers.

This old model for publishing was modernized with the addition of cryptographic assurance layers by cryptographers John Kelsey and Bruce Schneier, who started their examination of intellectual property business models with a deep pessimism about the long-term technical viability of digital rights management systems. Kelsey and Schneier dubbed their system “the street performer protocol” in tribute to a friend who friend who had travelled Europe earning money with bagpipe performances. Presumably, the friend found that he could earn more money by passing the hat before or during a performance rather than after.

Street Performer Protocol is a fund raising method designed to support the free release of a creative work. The creator agrees to release the work only after a threshold amount of money is pledged by supporters. For this reason, the method has been termed a “threshold pledge system“. Kelsey and Schneier describe how a third party, who they term the “publisher” can provide supporters with a layer of assurance that the creator will live up to his end of the bargain if the threshold is reached; otherwise, pledges are refunded to the supporters.
Another term that has been used for systems of this sort is “ransom publishing”, which is particularly apt when an author gives away the first few chapters of a novel, but holds the rest of the chapters hostage until a suitable ransom is paid by readers who want to read the cliffhanger ending.

Somehow I doubt that a cryptographic assurance layer would have helped much with Mozart’s concertos. Nor do I think that Mozart would have had much success giving out the first movement before asking for contributions.

What might have helped Mozart a lot, however, would be a market.

Markets function by bringing together many buyers, many products, and many sellers. If Mozart had been able to offer subscriptions to every music lover in the world, and those music lovers had easy access to all the composers in the world, Mozart would have been a very wealthy man.

Web sites that attempt to create markets for creative work around threshold pledge systems are definitely a trend. Kickstarter is perhaps the best example- They provide opportunities for creative people to solicit support for worthy projects. In many cases, the creators provide benefits for people who have supported their work. Another example is FashionStake, a website which lets ordinary people support fashion designers by pre-ordering designs before they hit stores. Supporters of successful projects thus get special access and special prices for the latest designs from the world’s top designers.

Kickstarter and FashionStake share several characteristics. The number of projects available for support is not huge; there are selection filters that have a side effect of preventing significant competition between projects. Also, there is an assumption that projects will not be executed if the threshold funding is not reached. The incentive to keep the threshold price low is that projects priced too high will not achieve their support threshold, and thus won’t receive any funding at all.

I’ve been thinking about how to apply threshold pledge systems to the sponsorship of open access for ebooks. I believe that with some modest but essential innovations, a sort of threshold pledge market could become a powerful economic force in many segments of the ebook business.

The first innovation would be to create a market that covered ALL books. According to the Google Books team, there are over 100 million books that can be identified in the world; a relatively small fraction of them are out of copyright, and an even smaller fraction of them are available as open-access ebooks. Why not let people sponsor any and every book they cared about?

Note that these books have already been written and published, so the sponsors are not being patrons of artistic creation, as in Kickstarter, FashionStake, and Mozart’s concerto subscribers, instead, they are posting a reward for conversion to open access. It’s wrong to think of this as “ransom publishing”- a parent doesn’t kidnap their own child! A better way to think of it is posting a “bounty” for the delivery of the ebook into a Creative Commons compatible license.

A second innovation follows from the first. If you allow the posting of a bounty on any book, then a lot of books will get only minimal sponsorship. Many of these books may be “orphans“, without known rightsholders for the public to purchase ebook rights from. The only way to keep sponsorship dollars from sitting unused is to allow them to be posted to many books at once. The first book to claim a bounty would take home the money.

Multiple commitment of sponsorship dollars has two interesting effects. First, it magnifies the impact of sponsorship dollars. An commitment ratio of 100 to one allows 10 million dollars of support to look like a billion dollars offered to rightsholders. Smart rightsholders who participate at the right time could walk away with sizeable rewards. Second, multiple commitment puts rightsholders in competition with each other for sponsorship dollars. If two books share many sponsors the bounty for one book would go down significantly when the owners of the other book decide to accept their posted bounty. Rightsholders are thus discouraged from waiting too long for sponsorship dollars to build.

None of this will work if sponsors don’t get something for their money. It seems to me that the released ebooks should include some sort of recognition text, but maybe just loading the sponsor’s devices automagically with released ebooks would be enough. Given some format validation, the released ebooks would slide easily into Google Books, OpenLibrary, Feedbooks, other places- LibraryThing, GoodReads, WeRead, GetGlue and devices/apps- Kindle, Kobo, Nook, iBooks, Ibis Reader. Perhaps most importantly, the released ebooks could be curated and preserved by libraries around the world, something that can’t happen properly with today’s copyright system. That alone would be enough to get me to participate.

Mozart would approve, I think.

Editor’s Note: I’m pleased to welcome Eric Hellman to TeleRead.  Eric is a technologist, entrepreneur, scientist and writer. After 10 years doing research at Bell Labs, he founded Openly Informatics, a linking technology business that was acquired by OCLC in 2006. Over the last year, he has been blogging about ebooks, libraries, and technology at Go To Hellman. PB


  1. This is genius, pure genius. The multiple commitments of sponsorship dollars is a brilliant market move. This is one of the best ideas to both help writers and publishers make money on writing while taking advantage of the cheap and easy distribution the internet offers.

    There is one problem though. The bounties would have to be get really big since the cost of making this happen would likely be big. The math is this: ((present value of future sales) + (cost of assembling rights))/(1 – (risk of not getting the bounty)). The first one is easy. It is the opportunity cost in not being able to sell the book in the future. The there is the bigger problem: It is quite likely no one entity will have all the rights needed to make this happen. Some of the rights likely lie with the author and the rest have been sliced and diced and spread out amongst publishers the world over. Assembling these would take time and negotiations, both which costs money (The tragedy of the anti-commons). The third thing one must take into is that the bounty money gets nabbed by some other publisher with some other book, thus robbing the publisher of the opportunity to make money of the rights it has been publishing.

    The fear I have is that to overcome all that the bounty would have to be much bigger than what people will be willing to put up.

  2. I would suggest that if there is an genius in this article then it is in creating language which makes it look like a good idea.
    ‘Ransom’ publishing is all well and good a concept when the creator is a known and valued producer and the buyer gets something exclusive to those who pay the ‘ransom’. I can see this bizarre idea working for a best selling author if the buyer gets a specially bound copy, signed etc. though I doubt it in real life.

    Stretching the concept starts to create other problems. Asking a consumer to pay in advance for something by a less than well known, or even an unknown creator, essentially also makes them an investor. They are taking a risk with their money and deserve to share in the profits made as a result of the creativity. If the creator goes on to achieve huge success with the creation then those who forked out in advance deserve to share in that profit. I would apply this especially to a project like Kickstart mentioned in the article.
    In the world of paper books there could be an argument that the receipt of a limited signed edition would offer asset enhancement sufficient to reward the investment. In the world of ePublishing this potential evaporates.

    The second proposition set out in Eric’s article is a difficult one to pin down. It sounds good but it seems to add up to a fund that the public can contribute to, that will reward those who convert old pBooks to eBooks. Sure that’s fine but I see nothing enormously innovative about it. I would then ask a question. After the pBook gets converted to an eBook who is going to distribute it ? at what cost ? and who gets to keep the profits ? The fund should really get most of the profits as the investor who enabled the conversion to take place in the first place.
    Personally I think that this kind of project is best suited to an entity like Amazon who could undertake the conversion as a broadly philanthropic investment and then reap the rewards from later distribution.

  3. Johan- Thanks for your enthusiasm. There are certainly many books with tangled rights issues, but their problems ought not to prevent publishers with clean rights from profiting from their foresight.

    Howard- Kickstarter doesn’t charge a sponsor’s credit card until the project meets its threshold. Similarly, an ebook bounty market needn’t charge supporters until a transaction occurs and the “goods” can be delivered.

    As for distribution, for a free digital good with cleared rights it’s amazingly cheap to accomplish. Between Internet Archive, Hathitrust and Google, there’s no shortage of places that will multiply host book content. See also LOCKSS.

  4. I may as well repost my comment here (as well as beneath other appearances of this article). Someone should invent a means of ‘hyper-linking’ so articles didn’t have to be copied. 😉

    I saw this in 2000 around the same time as Kelsey & Schneier – independently.

    I’m working on a generic back-end The Contingency Market to support all manner of sites based on a similar principle: bargains between large numbers of people and those responsible for the performance of public events or delivery of public goods, e.g. publishing an intellectual work. I hope to demonstrate the idea with something rather simple: 1p2U.com – those readers of a blog who want to encourage the blogger sponsor further articles at a penny each.

    You’re one of the few (if not the only one I’ve come across) to recognise that one only needs a single penny on the table to back thousands of penny pledges, and thus amplify the liquidity of all commissions, and magnify the total funding available.

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