Software Piracy and supply

Software Piracy and supply

This is interesting. From the Register, an article called, “Software piracy pushes companies to be more competitive, study claims • The Register“, sub-titled, irreverently as ever, “So, do copy that floppy?”

The article is written by, Wendy Bradley, assistant professor of strategy, entrepreneurship, and business economics at Southern Methodist University’s Cox School of Business, and Julian Kolev, an economist at the United States Patent and Trademark Office. The article describes their methodology, and links to their paper. They define the launching of Bittorent as a shock and examine the intellectual property development of vulnerable companies to that shock.

“When comparing the IP strategies of software firms at risk of piracy (the treatment group) against those of not-at-risk firms (the control group), we find that our treatment group significantly increases its innovative activity after the piracy shock in terms of R&D expenditures and granted copyright, trademark, and patent applications,”

Bradley & Kolev – Software Piracy and IP Management Practices: Strategic Responses to Product-Market Imitation (August 2021)

Interestingly it seems, that Entertainment software companies behave differently. although the academic work done, as quoted in the article does not suggest that piracy reduces the supply of content.

Basically the big software firms use their superior cost structures, achieved by size and source code ownership to increase the rate of innovation to keep their customers coming to them. The entertainment companies don’t. I don’t think they look at the size and cost of investment into regulatory barriers to entry, both buying the laws they want, and pursuing newly created malefactors.


Bradley, Wendy and Kolev, Julian, Software Piracy and IP Management Practices: Strategic Responses to Product-Market Imitation (August 2021). USPTO Economic Working Paper No. 2021-3, Available at SSRN: https://ssrn.com/abstract=3912074 or http://dx.doi.org/10.2139/ssrn.3912074 …

Fair Pay!

Fair Pay!

The press are full of stories about Google looking to reduce the pay of those who continue to work from home as the public health restrictions are lifted. This is unjust; if there’s one lesson learnt during the pandemic it’s that essential workers are under paid, but the idea of the world’s most profitable companies trying to restore/boost their profitability by reducing the wages of their workers is, while not unexpected, pretty appalling. In the UK, this may open an employer to equal pay suits.

Google claims to be a global talent company and it would surprise me if they don’t pay the market rate for the job wherever! I know that Sun Microsystems, in its last few years came to the view that the talent market was global and set up HQ offices around the world with Labs in Grenoble and St. Petersburg and a location in India. It bit them the arse when they came to close the offices, French redundancy consultation laws are a bitch … we could do with some laws like that. (In fact a game I played with my US managers and peers, was asking which country in Europe is it hardest to fire people in, and they all thought it was Germany. The answer was in fact Italy, where the comrades went on unofficial strike. Germany was 4th, after Italy, France and the Netherlands.)

Marxists argue that employers will seek to pay the minimum wage with crudely speaking a floor of the replacement cost of the labour; they also argue that all the value is created by the labour and that it’s the appropriation of surplus value is the driver of the class struggle. Classicists argue that now that labour has transformed from animal effort, there is a supply and demand for skills and experience and there is an equilibrium grate of wages. I suppose the cost to commute vs the born cost of provisioning the workplace are factors in determining replacement cost and/or the supply curve, but they are also part of a 21st century trend of dumping cost elsewhere. Let’s note that when employees work from home, Management save the cost of office space.  Here the employer is seeking to reduce wages by clawing back the employee’s travel to work costs and also make savings by reducing its office costs.

You need a Union, see also Less money for working from home? at GMB London General X58 Branch …

Community creates value

Community creates value

Cory Doctorow comments on Games Workshop’s latest legal initiative against its fans, I chose some quotes from the article, including the allegation that they behave like sociopaths and created their IP in exactly the way they're pursuing others for. I conclude with, the probably not original statement, "Open source campaigners have always argued that community creates value, here's another battleground where it will be tested.".

The Northern Ireland Protocol

The Northern Ireland Protocol

I was originally going to write something which I hope might be profound or provoking, but in the end, this just noted more of the Govt’s myopia. Northern Ireland Protocol was agreed to avoid border infrastructure on the island of Ireland. The UK Govt agreed … Boris and the DUP blew up May’s previous solution to the problem , which was to belong to the Customs Union while working out something better. The Guardian comments,

Just seven months after it came into force, the Northern Ireland protocol is once again a significant flashpoint in the UK’s relations with Dublin and Brussels.

On Wednesday, the UK published a “command paper” on the protocol. Some will see it as an attempt to tear up the agreement Boris Johnson struck in 2019; others will see it as a serious attempt to fix a deal they argue was flawed from the beginning but signed to help the British prime minister to get Brexit done, as he had promised.

Lisa O’Carrol, The Guardian

Lord Frost, the Brexit Minister presented a command paper to Parliament last week. This article looks at the paper, its proposals and puts them in a historical/political context. It looks at the contribution  to Northern Ireland’s problems that the end of Freedom of Movement has caused. It asks if the supply chain problems in Northern Ireland are the real concerns of the Govt or if  It then looks at the potential political cost in international reputation and ends looking at the theories explored in “The need for enemies”[3]. In terms of Brexit problems, re-joining the customs union and single market looks quite good.

Michael Dougan, Professor of European Law, University of Liverpool Joint Editor, Common Market Law Review writes on Twitter,

The command paper is an attempt to renegotiate the Northern Ireland Protocol, part of the Withdrawal Agreement which left Northern Ireland in the EU’s customs area for the purposes of intra-Ireland trade. The NIP was Boris’s jolly wheeze to allow him to present Brexit as an oven ready deal and allow him to distinguish his deal from May’s which had agreed, unless other agreements could be found, to keep NI and Great Britain in the EU Customs Union. While some of the Tory backbenches saw the cost of May’s delaying tactic as too high a price, and the DUP only caught on after Johnson’s election had made their support unnecessary, there were substantial reasons or at least as far as the Vote Leave faction in the Tory Party were concerned, for making this change, but one key priority was Tory Party management and today we need to ask did Frost and Johnson understand or care; the Northern Ireland protocol which was presented by many as a customs border in the Irish Sea and was always going to be a problem for the “Vote Leave” extremists, and many others. This was done exclusively for reasons of party management.

Frost proposes that the Govt UK & EU replaces the current regime of documenting all goods’ rules of origin and satisfactory quality to documenting them for only[1] those goods for which the final destination of is Northern Ireland. Chris Grey in his blog, “The Frost-Johnson approach has already failed “.

These include a revival of the ‘honesty box’ idea in place of customs checks, a Sanitary and Phyto-sanitary (SPS) ‘dual regulatory’ system, and the removal of the ECJ’s role in governance. These suggestions are not explained in any great detail, but in many ways they quite closely resemble the proposals made in October 2019, and rejected by the EU …

Chris Grey

This would be a problem for the EU which it seems has already rejected these proposals in 2019; if we act as an entrepôt for goods from outside the UK, EU tariffs will not be collected while safety rules and rules of origin may be subverted. This would also cause the EU problems with its relationships with Switzerland and Norway as they (and others) may also ask that these provisions are extended to them. To agree this, trust between the EU & UK would need to be higher than it is, and what trust exits will have been damaged by the way in which the command paper was trailed with threats of its revocation.

The paper also objects to the significant residual authority of the ECJ and Commission in Northern Ireland and the increase in power of the EU institutions that these compromises would require. This is a political objection and the problems cited are evidence free. The UK Govt. has sought remove the EU jurisdiction from the UK over many issues[2], but the Northern Ireland Protocol belongs to Johnson’s administration. Are they seriously trying to wind these provisions back? It would be a major step if so, and remind everyone as to whether it was signed in good faith in the first place and raise questions of trust throughout the world.

The EU took 24 hours to say, that they will not renegotiate the NIP,

We are ready to continue to seek creative solutions, within the Protocol on IE/NI, in the interest of all communities in Northern Ireland. However, we will not agree to its renegotiation.

Maroš Šefčovič

While the Northern Ireland protocol is a key point of conflict, the Trade & Co-operation Treaty agricultural product grace periods have been unilaterally extended for 6 months at which point the UK is committed to meeting its trade border commitments under the treaty and the world trade organisation rules. This will likely exacerbate the difficulties in the food supply chain within the UK and most acutely in Northern Ireland. Some of the political pressure is being applied by the major UK food retailers who are carrying the burden of the documentation costs and are also suffering from a shortage of lorry drivers, [BBC | FT (£)] another effect of Brexit’s abolition of freedom of movement. While a burden to the large companies, the documentation overhead, costs and transport shortages are worse for the SMEs. Is the fear truely about Northern Ireland, or are they concerned that the expiry of the control free grace periods will make things worse in England!

Meanwhile other national leaders issue warnings that negotiations must be undertaken in good faith and that commitments made are kept, a warning to the Johnson Govt. Further warnings will be sent or have been sent by the Biden Administration and other US friends of Ireland. The UK’s accession to the Lugano Convention, which involves mutual recognition of national courts. has also been vetoed by the Commission.

The EU have responded in that both  Maroš Šefčovic reported by Sky News, and Ursula van der Leyen have rejected the proposal to renegotiate the NIP but a continuing conflicting crises suits Johnson & Frost, their Brexit war continues although there may be simple ways out of this particular impasse, the most obvious is membership of the single market, which with the re-establishment of freedom of movement, might mean we could get the food lorries moving again although there are less dramatic compromises.

This behaviour by Frost and Johnson is reinforcing the world wide view that they signed a deal to ‘get over the line’, lied to the UK electorate and had no intention of abiding by the terms of the agreement. This is their deal, the problems were foreseen, they need to own it. This isn’t the last of these bogus crises, the UK-EU future Trade & Co-operation agreement is full of deadlines and reviews which will allow Johnson to continue to paint the EU as bad faith actors and rile up his base. In “The need for enemies[3], it is posed with evidence, that politicians with a reputation for solving a problem, have little incentive in doing so. This seems to inform Boris Johnson’s strategies when his inherited laziness permits him the time to strategise.

We need to be clear, this is a crisis of Brexit and while this one will probably be resolved, there will be another one, probably quite soon. It all makes Brexit a questionable endeavour with limited support in the UK.

The EU, it seems are coming to the conclusion that Johnson and Frost signed the withdrawal agreement in bad faith and have always meant to renege on it


[1] Goods excluded would be declared by a ‘light touch’ declaration albeit using a system that does not yet exist

[2] However, the CJEU still has some jurisdictional authority over citizenship issues.

[3] “Fergusson, Leopoldo and Robinson, James A and Torvik, Ragnar and Vargas, Juan F” (2012). “The Need for Enemies”. National Bureau of Economic Research: {10.3386/w18313} http://www.nber.org/papers/w18313

See also, if you want, my notes page on the Northern Ireland Protocol. …

Meals Ready to Eat. Not!

Meals Ready to Eat. Not!

Reuters reports on a meeting between food distribution industry representatives and DEFRA. Using the Army was only one idea expressed, and it’s an indicator of the com9ing food shortage crisis created by Priti Patel & Boris Johnson’s “controlled border” policy and Brexit. One of the massive labour shortages at the moment is HGV drivers, and we can’t get the food to the supermarkets, even if we can pick it from the fields. The problem is compounded by the relatively low wages paid these people . UK PLC is failing because its low wage economy cannot get people to work for it any more.

from team voyas, via unsplash

My evidence for the coming crisis is that. in Tesco’s yesterday, there was no cabbage. and the garlic came from China. (I have grown garlic in my garden in previous years, so there is a food miles carbon cost thing here too..) …

Why inflation?

Why inflation?

Have we returned to the Phillips Curve which described a macro-economic policy choicei.e a trade off between inflation and unemployment? The Bank of England predicts an inflationary blip, and yet labour shortages in the UK seem endemic. The Govt’s policy is to constrict labour supply by restricting immigration which is increasing wage costs and effectively reducing gross national product. It’s not wages that are problem, although in many sectors they remain are too low and subsidised by in-work benefits, but a lack of workers. Time for the QMT loonies to pull their heads in, as explained by Simon Wren Lewis in his near rant on the elitist pessimism of the inflationary hawks.  …

On economic migrancy

On economic migrancy

The dirty secret that makes a non-racist immigration policy difficult is that economic migrancy is demand led. Post Brexit, we are short of farm workers, lorry drivers, hospitality workers, and health workers because they’ve gone home and aren’t allowed back in or don’t want to come because of the xenophobia. All of this is causing food shortages, price increases and reduced and delayed health delivery.

On the whole immigrants are younger and of working age; as our population ages we need more people of working age, to produce stuff, deliver services and pay for the pensions of our old and education of our children. The quid pro-quo must be that we offer them citizenship and treat them as neighbours, not to harass them using the hostile environment laws.

A further problem is that the work not being done reduces the tax income of the treasury.

Migrants and young workers pay old people’s pensions.

I salute those who made the single market and freedom of movement the centre of their opposition to Brexit; the facts on the ground today show them to be right, and this is before we consider those Brits in Europe who’ll have to give up their homes and jobs, and those people who travel to Europe for work, such as musicians and actors and others, it’s not just building workers anymore.

If it’s in our interests to welcome migrants, then there’s only one reason for behaving as our government is!

ooOOOoo

The ageing of the global north, and its funding sustainability was observed and publicised by the IMF in the paper,  “Immigrant Swan Song”. For more, from me see tag:immigration

I was thinking of linking to a video clip from “Auf Wiedersehen, Pet”, but the quality on youtube is not good and it’s probably not as funny or insightful as I remember. …

Crisis in the hospitality business

Crisis in the hospitality business

While it seems people are desperate to get back to the pub, the staff don’t seem so keen. Across the country, pubs and restaurants are having difficulty in recruiting staff. Here’s the BBC, here’s the FT and again, here’s the Manchester Evening News. Even Tim Martin, the arch Brexiteer Weatherspoons boss is complaining. This is another lesson to us about how our economy is out of kilter, essential work is not well paid!

While much of the reporting suggests a desire for a better life work balance, I wonder how much Brexit and the end of Freedom of Movement has to do with this.  …