Dissolve the Analogue & Digital Distinction (338.57 GRIF)
Control. Discrete, direct control of data is what lit me up.
A Chinese court recently confirmed that digital assets have the same legal rights as real property. Combined with policy trends in the US and EU, the legal right to exert control over data is here. Build it and they will come.
The press is focused on crypto and NFT trading or personally identifiable information (PII), but this misses the larger point. A digital asset is anything that has been digitized.
To avoid confusion, I think in terms of objects instead of digital assets or data more generally. An object is anything that can be defined so this terminology removes the distraction of the various formats of data, content, and media. And it is a distraction because the base unit, binary code, is the same for anything that is digitized.
Using the term objects also facilitates comparison between the virtual and physical worlds. Objects are equivalent in both cases.
THE ANALOGUE
A painter starts with an idea then turns to his tools such as paint, brushes, and canvas. The suppliers of his tools have no claim on the artistic output, including no right to see the work. The end result is a painting, a discrete object.
The painter can sell it or shred it. It can end up in a museum. It might go to private storage. No matter how control is exerted, there can never be more objects than originally created. This is why original pieces of art retain value and replicas do not diminish the original.
An owner loaning an object to a museum is an example of an owner delegating responsibility. The museum becomes responsible for controlling access to the object. However, the owner can reclaim their property subject to any agreement that covers the loan.
In the physical world, this interaction between ownership and control can be so complete that artist Clyfford Still exerted near total control over all the art he ever created. Upon his death in 1980, 94% of his entire artistic output was ultimately left to an unnamed American city on the condition it. house and maintain this singular collection in perpetuity. Four decades after his death, the contract still holds and enjoying his work requires a visit to a purpose built museum in Denver, Colorado.
THE DIGITAL
When I moved to the UK, I brought my collection of vinyl records with me and have played them with no issues. These physical objects were bought in record shops around the world. I maintain complete control over what I do with them. I own them and I control them.
My Apple media collection is different by design.
After the move, a significant number of purchased movies were no longer available in my iTunes library. Removed titles ranged from the entire Star Wars catalogue to The Big Lebowski to The Lives of Others. There was no apparent rhyme or reason.
The movies disappeared from my collection because I redomiciled my Apple account to the UK. Without making that change, I could not access various geo-restricted iOS apps, including for my gym and bank. I also couldn’t check which media titles would be impacted in advance of the change.
This change to my account is a global change across the Apple ecosystem. This means my movie access rights are now based on UK licensing, regardless of where I bought them originally.
However, with time some movies have reappeared while others remain unavailable. At best, I have a strictly limited form of control over these objects. This is a specific example of a much larger issue.
Buying digital access that has any safeguards for the IP owner’s rights currently ties the object form of that IP to a platform and access is in the hands of its developers. In effect, the object I am buying is leased access, completely subject to Apple’s business decisions. I am not buying an actual copy of the movie in the way that buying a DVD is a perpetual right.
If I abandon Apple, it’s like changing from VHS to DVD or vinyl to CD. I have to build a library all over again. Yet, unlike the switch of physical formats, digital channel switching brings no intrinsic change to the media.
Bandcamp is an excellent study of how any app that enforces rights does so only within their platform. Purchasing an album on Bandcamp unlocks two access rights. The first is the ability to download the purchased music for offline listening in the Bandcamp app. Other streamers do this by licensing an entire library for a monthly fee. The result is the same regardless of business model. If I want offline acccess, I must pay and I will be able to access only through the app that collected payment.
Interestingly, the second right Bandcamp sells me is the ability to download unencrypted music files. This download provides music files that are available wherever I want them and I can use whatever music player I choose.
Once downloaded, these objects can be distributed with no protection from unauthorized access. The creator’s IP is without protection and can be freely infringed. This is the fundmamental choice the likes of Apple have convinced us is a necessity. We have been conditioned to view it as a binary trade-off between securing objects and platform agnostic availability.
Controls, particularly access controls, simply do not travel in the current implementation of the virtual world. They get stripped away the moment objects are communicated openly.
But…
THE LEDGER
Blockchains solve this problem by creating a public database that secures private records.
Once a record is publicly secured and confirmed as the possession of a specific address, there is an anchor that any software can authenticate. There is a single key to control the ledger entry which any software can be programmed to authenticate and determine if a user has the right to handle the related object. The access point is discrete but the authentication process relies on public data that is widely distributed.
This public ledger record keeping is what underpins the Chinese court decision. The time stamp databases running these ledgers use cryptographic principles and are tamper-proof. There is finally a method for everyone to view a record and subsequently authenticate who has access and control rights.
This sets the stage for provable ownership debates. Who invented Bitcoin is the first major case questioning ownership of these key based objects, but the conversation is shifting to a multi-dimensional discussion of ownership. We are in the early stages of a rush to secure digital objects in defence of AI’s need for a massive quantity of quality inputs.
There will be litigation in the years to come that will redefine industries and who controls a major factor of production. The fight for data ownership has a legal basis and now owners have the technological ability to reject infringement across the internet.
Individuals will gradually reclaim rights that are accepted in the real world and egregiously ignored digitally. Consider that digital tracking software is widely used but real world tracking is strictly illegal and easily enforced in courts.
This technological change is on the side of individuals. While industrialization consolidated power, ownable data gives a critical production factor of the modern economy back to individuals.
Individuals who create and secure their property will reap real world value. The wave that is swelling will encompass the trends of the gig and creator economies, AI, digital identity, and many others.
If I control the data that I create, I’m able to monetize objects in incredible ways. The key is discrete control and efficient use of what it unlocks.
