This document suggests a way of collecting money to pay for the production and presentation of artistic recordings and performances. It's a fund-and-release system. We propose that applications of this mechanism be described as “Takoha systems”.
The costs of reproducing digital content (music, video, text, etc.) are now practically zero. The essential costs of the original production remain, though, and those producing the content usually wish for some financial reward.
Technological and legal enforcement of the copyright system for such content is doomed. Technical enforcement is ultimately impossible because what can be rendered can be recorded and copied. Legal enforcement would require such intrusive policing as to be simply unacceptable in a free society.
Once digital content is released, it is effectively available to all, for free: a digital work is a public work. Copyright is finished. Whether or not this is desirable is irrelevant. The current business model is collapsing.
There is a looming risk of a market failure in which producers wish to release their work, consumers are willing to contribute to the costs of production, but legacy remuneration systems are incapable of supporting the transaction. Ideas for adapting and replacing current systems are incomplete or apparently desperate and unrealistic.
Takoha systems offer an alternative to the current mechanism, resurrecting the 19th Century practice of collecting subscriptions for public works.
A Takoha system allows many subscribers to make variously-sized financial contributions towards the release or realisation of some artistic endeavour in advance. The money is collected until the advertised threshold amount is reached or the advertised time limit is passed. If the balance is reached in time, then the work is released and the producer gets the money. If not, then the money is refunded to the subscribers.
Collecting money in advance solves the problem of copyright violation: when the work is released, the money is already paid. The work can be freely released to everyone. Contributors can offer exactly as much as they think the project is worth, and they only need to pay if the project is actually realised.
A Takoha system is a web-based mechanism used to collect funds for projects. It's essentially an escrow system very similar to the Street Performer Protocol.
It's possible that a single person or group could fulfil more than one role in a particular Takoha system.
As part of the project proposal, a producer might offer to insert public acknowledgement of those who made significant contributions to the funding.
If the project result is some digital artefact such as a video or sound recording, it can be permanently available for download from the project pages after the project is complete.
The amount which a producer can successfully collect for a project is largely due to their reputation. An unknown artist would need to begin by offering work for free: some demos and samples. Then they might gather enough support to charge a small fee for their next work. As the relationship between producer and subscribers grows, the project price may eventually become huge.
A Takoha system must provide a reliable way for reputation to be built and maintained, protected and possibly visible from another system. This is largely a matter of ensuring producers' identity.
The project adjudicator role provides another way for the producer to build trust with the subscribers. It's of course in the interest of the producer to name an adjudicator whom he can trust, but to inspire the faith of the subscribers the adjudicator must be seen to be impartial. We imagine these adjudicator roles being filled by music and film journalists, retired artists and so on.
A fully-implemented Takoha system would provide a tree of adjudication so that a decision can always be reached in the event of a dispute or accident. So one of the fundamental roles of a Takoha system is to be the root adjudicator for all the projects it facilitates.
The most obvious application is for Takoha funding the production of recorded music, but this is obvious mainly because there is such an ongoing clamour about the copyright problem for those artists. In fact, musicians are already working around the problem to find other ways to earn income.
It's possible that film producers would actually find Takoha more necessary than musicians, since they have much larger up-front costs, tend not to have such committed fans and cannot make live performances. Merchandising and licencing are probably only relevant for a few types of film.
The Takoha mechanism is also perfectly suited to funding written work like novels, poetry and even essays. The problems encountered by musicians have so far been less relevant to writers, because the printed format is still important. This is sure to change as on-demand printing becomes more widespread and the usefulness of e-readers improves.
Some performers such as public event artists don't have any way of earning money directly, since that can't charge admission to their acts. Takoha funding would be a new opportunity for them to earn income directly from their work (instead of from grants and derivative products).
The inspiration for Takoha is the subscription-funded public work. So it's irresistible to suggest that it could be applied to public installations such as statues, parks, and even infrastructure projects like bridges, footpaths and roads.
Some open-source computer software development work has been funded by Takoha-like systems, but even commercially-developed software could be funded this way. Features could be proposed and priced, and users of the software could contribute to their implementation according to the value which they perceive the features have.
No doubt pornographic film-makers would take advantage of a Takoha mechanism if it suited them, but their excesses would be tempered by the formal nature of the system, the time delay, and the individual accountability which is built-in. To put it more plainly, if copyright were properly abandoned and Takoha funding mechanisms were used instead, it might actually frustrate the production of unpleasant pornography.
Photographers would probably find it difficult to use Takoha funding systems for their work, but this fact may reflect our general reluctance to pay for photographic images rather than anything intrinsic to photography as an art-form.
Takoha doesn't offer any solution to the imminently-critical and severe problem of how to fund good-quality news journalism.
Anyone could set up a Takoha system, if they were able to command or generate enough trust. The subscribers and producers need to trust the adjudicators and the bankers.
It's not impossible that a well-known and much-loved artist could set up one for their own projects, acting as producer, banker and adjudicator. We imagine, though, that Takoha systems are generally best run by public institutions or well-trusted companies with no direct financial interest in the projects they administer. For example, a country's culture ministry could set up a Takoha system, running the web site, underwriting the adjudication process and holding the escrowed contributions. Alternatively, a company like Amazon may be able to garner enough public trust to set up a private sector Takoha system.
Perhaps a legacy film production institution or record label would be in a good position to offer a system, if they could earn the confidence of consumers. They would be able to provide the service for their existing 'stable' of artists.
There's no limit to the number of Takoha systems which could be established, but there must be a reliable method of accumulating and transferring producer reputation. In practice this would probably serve to limit the number of systems.
In much of the world, artists are quietly subsidised in various ways by the state, in addition to the more noticeable grants and donations from institutions, companies and charities. This is more or less necessary to allow new artists to develop, but it's hard to believe that such subsides are both fair and efficient.
A Takoha system offers a new mechanism to subsidise production which is perhaps more open and democratic. The producer may propose a project and set a price and then apply for a project-specific subsidy which is some fraction of the price. The state could decide to contribute that much as an initial contribution, and it would then be up to the artist to secure the remaining balance. If no-one is actually interested, then the state's money is recovered intact.
The administrative and overhead costs of operating a Takoha system must be borne by someone. The most obvious funding mechanism would be to charge a small fee or commission on each project proposal. This would also serve as a basic quality filter, since there would be a cost associated with any proposal.
An alternative would be for the state or a charitable foundation to cover the operating costs as a way of supporting artistic work without directing it.
It has sometimes seemed feasible that the interest earned on the money held in escrow might be sequestered to cover the operating costs, but in this time of great financial volatility it's not clear that this would be sensible mechanism. Interest should be paid to the subscriber for the escrow period (or actually charged to the subscriber if interest rates should become negative). In this way, the subscriber would get the same result as if the money had remained in his current account.
We foresee that the same basic pattern could be applied with different levels of formality, and we propose the following hierarchy.
In this case, a producer makes a direct link with the contributors. The subscribers and the producer trust each other and the amounts of money may be small enough to keep things comfortably informal. The subscription money may be held by the subscriber or the producer, and no adjudication is needed to declare the project 'realised'.
A more formal one-off implementation of Takoha could be set up for a single project. An adjudicator and banker are appointed, but when the proposal dies or the project is realised, the system is dissolved.
A single Takoha system could be run in support of many projects simultaneously, and continue to be open for ever more project proposals. In this case, the banking system would need to be extremely well-trusted: perhaps therefore avoiding commercial financial institutions in favour of national banks or mutual societies.
For the artist, this approach to funding their work is profoundly different from current arrangements. Creative effort would no longer give rise to an endless but uncertain stream of income. The full price would be agreed in advance, and each successful project would increase the value of the next. Production would no longer be a speculative investment: the price would be 'negotiated' in advance with the sponsors. Knowing how much people value your work might be a frightening prospect for many artists.
For the consumer, the world is also transformed. Every released work is available to be enjoyed for free. If there's something you like and you want more of, you can become a subscriber to a project which is likely to produce it. You can support several different projects at the same time, and contribute in each case exactly as much as you think the project is worth to you. If you don't care what's available, or if you haven't any money, you can free-load on the results of other people's contributions.
In general, the application of Takoha funding should result in a flattening of the income distribution among artists, as it's a way of harnessing the long tail of consumer taste. It would become financially viable to initiate obscure projects, and this may be at the expense of mainstream artists.
This is really an orthogonal issue. Takoha is proposed as a necessary technical replacement to a failing system. The question of whether it's fair on everyone is not relevant to whether it's a solution to the problem.
Still, we can see that the winners would likely be people who have yet to produce or release their work, as opposed to those who are harvesting endless trickles of historical copyright income: they would immediately lose out unless they can secure some compensation in another way.
Those who manage and perpetuate the current remuneration system would need to change role to survive, but if they are actually doing something which is genuinely useful to the production process, then they would presumably still be needed. On the other hand, if their role is purely functional or even parasitic, then they would fall by the wayside.
For example, an author of novels may get funding directly from his readers through a Takoha system, but might still need an editor to produce acceptable work. His erstwhile publisher might find a role as his project adjudicator. The lawyer who sent threatening letters to people who posted parts of the book online would need to find something else to do. As for the printers and typesetters, well, their survival depends on whether people want to have paper copies, not on how the author gets paid.
Generally, it's almost certain that a switch to Takoha systems would reduce the overhead costs of content production. That means many existing paid roles will become redundant. Such is the eventual effect of most technological change.
Takoha is a Maori word meaning promise, donation or pledge of money as a contribution to something.
This is not completely new. The Takoha manifesto is no more than an extension of other, similar, ideas.
So we know that this is not an original concept, and no doubt somewhere in the world, people are trying to use a Takoha funding mechanism. For us, the really interesting question is why isn't it being more widely used?
In the hope that a fresh attempt to outline the idea will help it to develop, we offer this manifesto.