Archive for April, 2012

April 19, 2012

Pinterest: Is Free Publicity Really Bad Publicity?


Always put on your skeptic hat when someone appeals to your sense of fairness. It’s a good general rule.

I think of myself as someone with a strong sense of decency and concern, I trust my own sense of fairness. But when someone uses it in an argument, I shy the away with natural distrust.

Not just because it’s a subjective term with no fixed meaning, but also because “fairness” often encourages people to act against their own interests. We generally file “fairness” in the same folder where our brains keep “altruism.” But in these cases, it should be kept closer to “righteousness.”

Fairness in Game Theory

Game theorists have a test called Ultimatum, wherein volunteers are divided into groups of two people. Money is given to one member of each group and he has to offer some portion of it to the other. If the second person accepts the offer, they both get to keep the money, but if the second person rejects, they both lose the money.

In theory, the second person should be willing to accept any amount, even a penny, because it will leave him better off than if he got nothing. But in practice, at some point the second person’s sense of fairness kicks in and he chooses to get nothing rather than let the other get what he sees as an unjust gain. So while at 50-50 splits are nearly always accepted, people start rejecting at 40-60 and by about 20-80, most players reject the offer, sacrificing their own gain in order to deny the other an “unfair” gain. (Some tests go further to show people rejecting their “unfair” gain even when nobody gets the other portion. Below a certain fairness level, they just don’t want to play.)

Fairness with Monkeys

In this study, pairs of monkeys perform an action earning a reward. For reward, one monkey is given cucumber while the other is given a grape. The cucumber monkeys are satisfied until they see the other monkey get the grape. Then some cucumber monkeys get so upset they throw the cucumber at the researcher, choosing to forgo the perfectly serviceable snack rather than participate in an unfair activity.

There’s a great TED video on the subject:

Fairness in Copyright

Without getting into the copyright maximalist/fair use maximalist dispute, but instead looking at it from a practical standpoint, I see authors and publishers shutting down uses of their works they deem a violation of their rights, even if the use causes them no harm, even if the use benefits them.

Whether it’s CBS or J.K. Rowling going after fan fiction that keeps their work fresh, or Viacom shutting down Youtube videos that amount to free advertising, there is an overly legalistic approach that seems focused more on making sure all benefits go to the “right” people than on maximizing the benefits they actually get.

They have the right (probably, usually). But why do content creators and owners deny their own fans the ability to do something creative or just plain fun with their creations?

The entertainment industry in all its various forms has a long history of opposing the very technologies that keep their cash cow lactating. Home video, radio broadcast of baseball games, movies (free!) on TV (more TV), all faced legal challenges by at least some content creators when new.

Which brings us to Pinterest.

Pinterest, surprisingly, is valued at 200 million dollars. “Surprisingly” because it’s on very shaky ground copyright wise. There’s been some controversy over Pinterest’s TOU because they use boilerplate “I promise not to infringe and I won’t ask Pinterest to help if I get into trouble,” language while having the non-boilerplate business model of infringement. They even encourage users to Pin other people’s work (users are urged not self-promote).

Under the law, Pinterest’s business model is probably fatally flawed. In fact, Pinterest sounds a lot like Napster. Except for one major difference–no Pinterest user would have bought these pictures they are now getting for free. So no argument can be made that the creators are losing money.

Pinterest user activities present rights owners get a great new vehicle for publicity. All free of charge. Pinterest’s users are unpaid, volunteer, often enthusiastic promoters.

But is free publicity good enough to stop the lawsuits? I doubt it. And the reason is…fairness. It’s not fair that people who don’t own these pictures are doing neat things with them without paying.

Beware the Monkeys’ Warning!

The major content owners have spent years trying to control piracy by threatening their customers. So let’s go back to the monkey video. In an altruism experiment (see 10:30 for the whole presentation, or 12:05 for the results) where monkeys were again paired and one monkey decided whether another monkey would get fed, intimidation by the other monkey was by far the least successful strategy for eliciting cooperative behavior. Less successful even than doing nothing.