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Relationship between intellectual property and consumer electronics p

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DavidV
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By David from Truth, Justice, and the American Way,cross-posted by MetaBlog

Is it reasonable to expect all high-tech products coming out today to be cheaply available in the future?

Of course it’s a truism nowadays that electronics are getting better and cheaper all the time, but I wonder if we can generalize to the following argument:

Consumer electronic products (I am speaking mostly about audio/video/computer products) have three somewhat unique properties. First, they are relatively low bandwidth and low power, due to the hardware limitations of homes and consumption by a few people. Second, they are mass-produced. Third, they are mostly information products, which means that are not limited to any particular form of material.

These properties are especially suitable to rapid innovation and a trend towards automation of production. The trend has accelerated with the shift from analog to digital, which makes data integrity much easier. The key to the process is that increasing automation shifts production costs from manufacturing and materials to design. More and more of a products retail costs becomes intellectual property. For example, low-end DVD players can be found for under $30. I read somewhere that the licensing required to decode DVDs alone costs about $20. (This is also about the cost of a DVD plug-in for Windows Media Player.)

Are there any inherent cost factors I’m overlooking?

Let me put the question another way: today or soon, a $3,000 LCD TV might cost $30 in raw materials and $30 in labor, and the rest in intellectual property. (Those numbers are WAGs..) Is there any reason to think that it would not be $60 in 15 years, when the IP has expired and/or been reverse-engineered?

Edited by GreedyCapitalist
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  • 2 weeks later...

Hmmm that is an interesting thought, and while those figures might not be exactly correct, the general idea seems to hold true as far as I can tell. I think I might think a little more on this one and do some more research.

A long such lines, it is for instance the DVD licensing issues which do not help free technologies like Linux, as they are expected to pay licensing fees to bundle it into Linux (which is of course why such things are generally not in the free versions of Linux) and a good argument for believing that such things might eventually have to start charging some smallish fee if they want get a decent market share (compare Linux desktop use to Windows desktop use) and why it would be sensible for their prices to go up a bit (in exchange for useful things like DVD playback, though you can get this for free, although this strikes me as dubious legally and morally speaking).

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FYI, Windows Vista Ultimate costs $450, but does not come with DVD playback support. (I tried.)

Edit: My copy of Suse Linux did come with DVD playback support with a software update.

Edited by GreedyCapitalist
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