This is something that's been on my mind for a very long time, and I was provoked to this post by Tom Magrino's rant on "always on DRM" being the ultimate solution for the world's copyright problems.
I take that idea further into a parallel universe utopia:
All information and software is encoded with a copyright id. Some software or information - public domain, open source or user produced - would not necessarily have a copyright id.
Parallel to this, all computing moves to the cloud, and all devices turn into screens and keyboards for the data and processing in the cloud. Bandwidth is free and people are only billed a FLAT rate for the CPU cycles they use in the cloud. FLAT, and cpu cycles. Remember those two because they're going to be very important.
Now record the copyright id associated with the executable and data processed with every CPU cycle. Tally this over the duration of a month and you have a comprehensive bill of all copyright ids that I have consumed in that period. I only pay the cloud service provide ONE bill every month for my CPU usage, multiplied by the FLAT rate. But the money from that gets split across all the copyright owners, by the cloud providers.
I don't pay for content, ever. I pay for processing and time. The cloud providers figure out the copyright stuff and distribute the money accordingly.
Such a system would be fair, because if I only watched a movie for (say) 10 CPU cycles, the movie owner gets paid only a couple of cents. However if I watched a movie 10s of times, for thousands or millions of CPU cycles the movie owner gets paid that much more. So the really cool stuff, that gets watched or played a LOT by people - a good indicator of quality - even if it's only a few people, gets due recognition and MONEY this way.
So a massive rpg with 100s of hours of gameplay, that gets only a few hundreds of thousands of users buying it or even knowing about it, could possibly make a LOT more money than a Call of Duty'esque game that offers only 5 hours or so of an okay experience, but gets bought by millions (I'm thinking single player of course. Multi is an entirely different proposition, and very different in the value it provides)
Such a solution would eliminate the need to buy anything digital anymore - nor would publishers have to worry about distribution - which I think is the primary point of friction and the primary origin point for piracy. Instead all validation and billing happens in the cloud AS YOU USE. It doesn't matter where you got the software or movie from. Maybe a copy from a friend, maybe free discs at the mall, maybe a torrent. It doesn't matter. Your cloud provider (or their CPUs) figure out which copyright holder's content you're watching and pays them accordingly.
This also levels the playing field in terms of pricing. A fair and workable system cannot have differential pricing for different content. All content is billed in terms of CPU cycles, which becomes the new currency. Ways of cheating by corporations - such as writing code that consumes a lot of CPU to tally up a huge bill, will be easily caught by millions of angry users, or even audited by the cloud provider who don't want to waste resources. People who try to increase the time spent by users in their movies or games by padding content, will become boring and eventually get played less, and by fewer number of people. Such a system would thus be self-regulating. I think a cloud CPU-cycle based billing system, and by extension one which is based on the time users spend with their content, could be the ultimate solution not only to beat piracy, but also make pricing fair, simple for users, and make producing great content (and art) that doesn't get consumed by a lot of people, but gets consumed a LOT by some people, an actually viable business proposition. Also, artists keep getting paid as long as their work remains relevant.
P.s. To answer some obvious questions on logistical issues:
a. Who manages all this copyright stuff?
Copyrights would be consolidated globally by select corporations - who may collect a nice fee on the side from copyright owners.
Cloud providers don't manage the copyright stuff themselves. They just figure out which copyright aggregator the content gets billed to - lets say there are 2 or 3 of those max, and send them a log of all copyright ids used in a month and the CPU spent on each.
The aggregator then splits money to all individual copyright owners.
Privacy issues get addressed by the cloud providers aggregating the copyright usage information provided to copyright aggregators, rather than providing per-user information. It's just a question of setting up the right legal framework around this - a MUST for any such far reaching system.
b. Copyright ids could still be stripped using custom software.
True, but there would be zero benefit to a pirate. Since the billing rates are FLAT, they get billed for what they see or use anyway. The only difference is the money may not go to a copyright owner, just sit in a slush fund or add to the cloud providers profits.
The cloud providers can be audited for these kind of slime tactics anyway, and all instances of copyright-free usage can still be logged and analyzed if required - the percentage would be significantly small, as there is no major benefit to stripping copyright ids anyway.
The only possibility is of people replacing somebody else's copyright is with their own so as to make money as "Trojans". Since lay people won't have copyright ids, and would have to register as a company to get one, any such companies which indulge in such tactics will be subject to regulatory restrictions, and can be audited for their monthly or quarterly earnings anyway.
Again, the nice thing about all this is that it takes the entire copyright mess away from users, and makes it the headache of companies and auditors/regulators, where it rightfully belongs.
c. People could setup rogue clouds where piracy can still flourish.
True, but these would be consolidated areas of illegal activity. These would be easy targets, and could be easily tracked and shutdown.
Legal and illegal use, could be viably separated like this.
d. What about offline devices?
In a world of cloud based devices, offline devices would either be prohibitively expensive, limiting in terms of their power and speed compared to stuff in the cloud, and also limitng in terms of having hardware compatible with what's on the cloud - incredibly difficult to do if the Intels of the world control and know who they sell to, and prohibitively expensive for any company to setup a rogue business around.
e. People would have reduced choice of OS.
True, and that's an undeniable side effect. It's entirely upto the cloud service provider to decide which OS to provide. Eventually, multiple OS's may even be eliminated, commoditizing instead different aspects of the OS, such as memory/CPU supported (high performance or consumer OS), user interface (think about how easy this is to do in Linux. The interface is just a plugin-able component) and screen sizes or usage paradigm supported (touch, mobile, gesture based, desktop/laptop, others)
f. By massive commoditization, hardware and software innovation could be killed.
Hardware innovation will move to the servers and to user interfaces. The former (in terms of CPU innovation, or chipset innovation) is super complex in a non-cloud world anyway. Software innovation will move to FUNCTIONALITY rather than technology such as drivers - which will be taken care of largely by cloud providers and their r&d teams. Developers will instead be able to focus on creative applications (like the awesome "Action Movie FX" on the iPhone - which in my view is rendered possible as a simple commercial product because of the ONLY incredibly easy to use video editing/splicing APIs already available in iOS, and the sheer ease of App Store distribution. Complex technology, simple, commoditized Apis and market) rather than worry about multiple platforms or device hardware capabilities.
Wrap-up: There are many more such questions and issues, which may or may not have solutions. But the point is that this is a completely utopian concept, that needs the entire world, every device, every OS and the fundamental WAY in which copyrighted content gets packaged, distributed and billed, to change. That ITSELF won't happen, but we can think about it, dream about it, and hope that there's a version of this utopian idea that can perhaps be implemented anyway, in a way which makes life easier and simpler for users and developers. Anyhow.