Does Information Want to be Free in Philanthropy?

One of the issues I write about frequently is “information sharing in philanthropy.” My basic argument is that because the social sector is trying to create value that accrues to the public, individuals actors in the sector can enhance their total impact by sharing what they know with other actors.

However, my argument also has echoes of the popular concept among Internet devotees that “Information Wants to be Free.” This concept advances a value judgment that information (especially stuff online) should be free.

I think this concept is nonsense.

The phrase “information wants to be free” comes from a speech given by Stewart Brand (editor of the Whole Earth Catalog, and founder of The Well, Global Business Network and the Long Now Foundation) in 1984. But Brand didn’t simply say that information should be free. What he actually said was:

On the one hand information wants to be expensive, because it’s so valuable. The right information in the right place just changes your life. On the other hand, information wants to be free, because the cost of getting it out is getting lower and lower all the time. So you have these two fighting against each other.

Brand commented on his speech in a 1987 paper that this tension…

…leads to endless wrenching debate about price, copyright, ‘intellectual property’, the moral rightness of casual distribution, because each round of new devices makes the tension worse, not better.

Brands comments reveal a deep complexity that the simplistic insistence that “information wants to be free” ignores. I bring all this up, because I want to be sure that when I advance the idea that philanthropy should embrace rampant information sharing, it is clear that my argument is not based on what I believe is the simplistic moral arguments that information in general wants to be free.

Instead, I’m so excited about advancing information sharing in philanthropy because the tension that Brand points to is mostly a function of for-profit markets and largely absent from social good markets. The reason we have “endless wrenching debate about price, copyright, ‘intellectual property’, the moral rightness of casual distribution” is because most information generally becomes less valuable to its creator as it spreads.

Coca-Cola is highly secretive of the formula for Coke. If they decided to share the formula, two things would happen 1) Other people would copy Coke, flooding the market with product as good as Coca-Cola’s, drive the price down and make Coke much more widely available and 2) Coca-Cola would find that their business was suddenly far less profitable since they no longer controlled the valuable information that underpins their business.

But the social sector doesn’t face this dilemma. Let’s imagine that a nonprofit existed that ran a program which successfully raised life outcomes of inner city youth. If they decided to share their “formula” two things would happen 1) Other people would copy them, flooding the nation with programs as good as theirs, drive the cost down and make the program much more widely available and 2) Social value creation would skyrocket, the developers of the program would be national heroes and probably win the Nobel Peace Prize (as Muhammad Yunus did in 2006 for advancing the field of microfinance).

Social media and the rise of almost costless information transmission is tearing apart for-profit fields like journalism and the music industry. But philanthropy doesn’t face the tension that Brand describes.

Yet philanthropy is failing to capitalize on the biggest transformational dynamic to hit our field. Brand writes that “each round of new devices makes the tension worse, not better.” But in philanthropy each round of new devices makes the opportunity better and our failure to capitalize on the shift more dramatic.

20 Comments

  1. Bravo, Sean. Two points.

    One I couldn’t resist to share these lines from an advertisement from the maker of a scanner since it seemed appropriate to your comment about the ease of information sharing in our digital age: Scanned documents “take on a higher level of accessibility and usefulness once liberated into the digital realm.”

    Second, a while ago I also blogged to encourage foundations to make their information free to copy: http://bit.ly/9tpauz

  2. Nice post Bruce. I agree that the failure of copyright might lead to less valuable content being produced in the for-profit sector. But the opposite is clearly true in philanthropy. If a foundation professional knows that their work will be widely read and used, the are MORE likely to create valuable content.

  3. I think the real value of information comes from finding meaning in a sea of noise, then translating the meaning into a plan of action for various players to carry out. Free information is great-but there’s sooooo much of it!!! It takes time, skill, patience, and perseverance to get from information to action to change or “impact” as we say here in CHIP-town. :) This post brings up a good point regarding the social sector. There are many organizations in place that have the resources and infrastructure to use available “free” information and act on it. They can implement programs and mobilize staff workers and volunteers. I need to think some more about this but Sean and Bruce, you’ve got my brain going again. Bruce, I’m reading your blog, toggling back and forth, while typing this post so will focus and comment on yours next! Ciao!

  4. Right on the mark Autumn. In an information rich world, it is effective filters that are valuable, not information itself.

    I wrote about this here: http://bit.ly/1eoqHC

  5. Gabi says:

    Thanks Sean for reminding us of the important difference between the value of information in the social sector and the value of information in the commercial sector. This difference is a critical one and one that gets overlooked all the time when we debate paid content versus free content.

    When we forget the original intention behind knowledge production in the social sector (namely that it will contribute to social good and social change) we also forget to dedicate the necessary resources to sharing this knowledge more broadly AND to the kind of filtering you and Autumn touch on in the comments.

    Just like any other social need that is not satisfied by the market (or is maybe even the result of a market failure), the work of making meaning from information, providing effective filters, and brokering knowledge in the social sector is a social service that needs charitable support. Which is why the free vs not free dichotomy is a little false. Maybe it’s more about subsidized vs non-subsidized forms of knowledge and about defining value in a nonprofit, not commercial, context.

    Oy yoy. Big topic.

  6. Dear Colleagues

    My interest in information is simple. I want to see very much better metrics about the state of society and the performance of society. The corporate world has figured out how to report profits … in many cases rather creatively, or I would prefer to say fraudulently … and there are metrics for stock market price increases and for GDP growth. But sorting out what is valuable from what is merely profitable is not a part of the system of money metrics. Community Analytics (CA) addresses this by looking at socio-economic progress and performance from the community perspective and not from simply the organization view. CA also embraces value as well as profit … including the difficult task of quantifying value.

    A charity that does things of high value should be favored over a charity that does things of lower value … metrics of performance matter in good works, especially when the available resources are scarce.

    Issues like secrecy may increase corporate profit as they do in the case of Coca Cola … and in the CA methodology that may be weighed against the lost value for society because the proprietors are constraining the normal market competition. Many corporate entities have figured out how to maximize profits and society be damned … but when the CA social impact metric is in play, the profit performance is counter-balanced somewhat.

    CA builds on the idea that what gets measured gets done. Until we have measures in play for social impact, the corporate world will simply maximize profits … and almost certainly put society at ever increasing risk of “who knows what!”

    Peter Burgess
    Community Analytics (CA)

  7. David Lynn says:

    Sean, great post. However, I will play devil’s advocate on one point: in major metropolitan areas like San Diego, where the nonprofit sector is an inch deep and a mile wide, we definitely see concern where a replicated program makes for more competition for donors. Much like Coke’s fear of reduced revenue. And we’d much rather have a few great nonprofits than a bunch of smaller less-effective ones competing for dollars.

    That said, it doesn’t mean that the nonprofit with the “intellectual property” is doing the best they can with it, and competition should be a good thing in the long run. Capitalist fundamentals in order to advance social welfare, apparently…

    Thanks.

    –David

  8. Thanks for raising an important point David. There may be a good reason for a philanthropic of nonprofit entity to withhold valuable information from society if the entity is trying to act in their organizational interest rather than a social impact interest.

    That’s very much like the way that many corporations act in the best interest of their executive suite instead of in the best interest of shareholders. I think your point helps explain one of the reasons information is not shared freely, but it is a type of corruption.

  9. Daniel Ben-Horin says:

    Sean, This is a good post, but I think there is a nuance here that you’ve missed, and it’s a nuance that strengthens your argument. The phrase “information wants to be free”, overworked as it has become, speaks to something that is fundamental to what might be called the zeitgeist of knowledge workers. Steven Levy’s book, “The Hackers” gets at this really well, in the context of the Homebrew Computer Society and the origins of the PC era. The Open Source movement is an obvious extension of this spirit, but I think it’s much more pervasive than just Open Source advocates. There are exceptions, obviously…and as Stewart notes information on some level wants to be as pricey as possible…but I don’t think we should overlook the spirit of sharing information– that underlies Wikipedia and many other projects. There’s an asset to be leveraged and it’s that asset that I think of when I see (and, I admit, sometimes use) that phrase.

  10. Dan Elitzer says:

    Nice post, Sean. I especially enjoyed your history lesson illuminating the phrase “information wants to be free.”

    I agree that unlike in the for-profit sector, information sharing in the nonprofit sector does not have a negative impact on the information-creator’s ability to achieve their goals. However, there is still an opportunity cost for organizations to package their knowledge and transmit it in a form that will reach and be actionable for other actors. Foundations may have the resources to engage in information sharing if they think it will advance their mission, but for most nonprofits, investing the time and financial resources to share their data or knowledge requires making cutbacks in other areas.

    If a nonprofit staff member is directed to evaluate a program and capture information on how it can be effectively replicated, the time spent on that task is time not spent on providing direct client services or fund-raising or training new staff, etc. If that staff member then has to find a way to distribute that information so that others in a position to act on it will find it, that’s more time not spent on other mission critical work. Yes, the time spent on capturing and disseminating information may ultimately do more to advance the organization’s mission than whatever other activity was superseded, but unless the organization is confident it can make that case to its supporters, that’s a hard call to make.

  11. Dan makes an important point: the existing funding system prevents the sharing of valuable information, which in turn prevents improved social sector performance. Like other kinds of nonprogrammatic expenses that enhance the ability of nonprofits to help more people — technology, office space, professional services, etc. — the inputs cost money so that more and better outputs (in this case, information about what works) can be free.

  12. Thanks, Sean, for your tireless efforts to debunk inconsistencies between theory and practice around important issues regarding knowledge sharing. As usual, I agree with most of your points.

    The challenges to broader knowledge sharing seem to boil down to some combination of time, turf and trust – at the tactical level for individuals and organizations. That is, good strategic intentions (to share) will nearly almost always lose out to the tactical tyranny of the urgent reinforced by the system of incentives.

    Specifically, while most individuals and organizations recognize the greater good that could come from sharing promising practices and tools, the daily activities of most busy nonprofit professionals is driven by more mundane trade-offs of what deadlines does my ‘boss’ or my ‘board’ focus on me meeting. As long as the benefits of sharing accrue almost entirely to “other” organizations, it will be the rare ‘boss’ / ‘board’ who will reward individuals and organizations that take time to share. So the issue of “time” is often the most critical barrier.

    This opportunity cost, as Dan and Steve pointed out is the practical limit to the argument to that the cost of sharing information is approaching zero … and, therefore, the price should be zero. To be sure, the marginal cost of sharing (with one more person/organization) is VERY low. But there are many very real costs (to name just a few) to having that information available to be shared:

    1) Putting information in a form/place that is re-usable,
    2) re-purposing that knowledge to make it easier to learn from,
    3) making that information easily findable,
    4) curating and providing context for that knowledge,
    5) and refining that knowledge based on feedback and re-sharing it.

    The issue of making widespread nonprofit knowledge sharing happen is primarily one of aligning individual and organizational incentives so the “right” tactical trade-offs are made to maximize the benefits to society. As Gabi rightly points out, that might mean (partially) subsidized knowledge intermediaries. It also might mean giving the “content producer” (sharing) organization a piece of the value they are creating for society.

    Through our online nonprofit knowledge sharing marketplace, we attempt to fairly and efficiently allocate value between content producer and content consumer by allowing content producers to set a reasonable price for their knowledge. For most, this earned income is aimed at cost-recovery and sustainability of their sharing objectives. When the content consumers feels the value they will gain (saving time, saving money, avoiding implementation risk, etc) is greater than the price, they are willing to buy that knowledge. And the reward reinforces the initial sharing investment.

    Scott Bechtler-Levin
    IdeaEncore Network
    http://budurl.com/TP0227a

  13. Jeff Mowatt says:

    Yes. One of the first acts in our work as advocates for inclusive capitalism was to publish the synopsis of the white paper containing the profit-for-purpose business model online in 1997, free for all to use for social purpose, The intention being to spread a meme.

    http://en.wikipedia.org/wiki/Inclusive_capitalism#People-Centered_Economic_Development

    Our work in Eastern Europe including business plans and strategy papers was conducted in full public view. We now retain copyright on these plans simply to prevent theft by those who would not commit the profit to a social objective.

    To offer an illustration of the difference, whereas Coca Cola is secretive about their recipe, our openness has provided former CEO the opportunity to create his own variant of our model of inclusive capitalism.

    http://www.thecoca-colacompany.com/presscenter/viewpoints_isdell_connected_capitalism.html

  14. Jeff Mowatt says:

    Now let me offer an extract fromof what I describe above, in the context of sharing information:

    “The greatest initial social and economic risk of the Information Age is in creating two distinctly different classes of people: the technological haves and have-nots. Those who have access to information and information technology have a reasonable expectation to survive and prosper. Those with limited or no access will be left out. This holds true for individuals as well as nations. The key to the future is access to free flow of information. To the extent that the free flow of information is restricted or diminished, people will be left to endure diminished prospects of prosperity and even survival.

    “In order for economic development to take place in any given location, the very first thing required, before anything else can possibly happen, is information. This information includes first and foremost where to look for the necessary resources to do anything. If new businesses are needed, knowing they are needed and finding funding for them are two very different things. The first step is to locate possible capital resources in order to move forward, and this step is no more and no less than information. Once resources are located, the next step is what terms and conditions are involved in obtaining those resources — more information. Once this is known, paperwork must be completed, business plans made, market research and due diligence conducted, and all of this compiled and forwarded to the appropriate parties. Again, nothing more than information. In fact, most of the work involved between identifying a need and solving the problem is information acquisition and management: getting and developing information.

    “As Alvin Toffler predicted in Power Shift, where once violence and then wealth were dominant forms of power, information is now becoming the dominant power. Those nations with the greatest freedom of information and means of transmitting it have now become the most powerful and influential, and the strongest economically. Toffler also predicted the collapse of the Soviet Union would come about due primarily to its authoritarian control and limiting of information. Unfortunately for Russian citizens, this old habit has continued for them beyond the collapse of the former Soviet Union and will at the least make an interesting case study on the survivability of a once strong nation which still remains committed to limiting and controlling information. In the opinion of some, the outcome is already set and “Russia is Finished.”

    “By going with the normal flow of free-market enterprise and the emerging replacement of monetary capital with intellectual capital as the dominant form of basic enterprise capitalization, it becomes easier to set up new companies primarily on the basis of invested intellectual capital. (See Post-Capitalist Society, by Peter Drucker). In plain English, socially responsible and forward-thinking companies can be set up quickly and cheaply–and these companies have indefinite potential for earnings and localized, targeted economic development. The initial objective is to develop model enterprises and communities, then implement successful strategies from those models into surrounding communities regionwide or nationwide, as needed. “

  15. Dear Colleagues

    I know of Jeff’s work and like it … and know some of his practical experience. The process of change to make the world a better place is not easy, but unless people try, there will be an even worse mess.

    As I develop my own work it becomes even clearer how the owners of any form of competitive advantage feel obliged to retain that advantage for themselves. It is a nasty reality of a market economy where the metrics are only about money profit, and value for society is totally discounted. When money profit is the only measure, then Goldman Sachs is a hero … when the impact on society is incorporated into the metrics, then they are the devil. If the accountancy profession had not excused itself from its responsibilities a couple of decades back, then there might be a rather different view of how “profitable” these money instruments really are. Social responsibility … value adding … is a critical component of a sustainable society.
    Peter Burgess
    Community Analytics (CA)

  16. Jeff Mowatt says:

    Thanks Peter, though I am more the facilitator in providing the revenue source for the work of our founder Terry Hallman. He describes it thus:

    “P-CED places people at the center of economic development. P-CED takes the bottom line one step further: to people, past numbers. Enterprise profitability and economic success cannot be fairly measured in terms of gains of money capital alone. Profit is redefined in human terms rather than pure quantitative analyses that remove human and social concerns in the name of profit. ”

    http://www.p-ced.com/1/

    In the manifesto which was the core argument froom his original paper, there’s a clear warning of the impending economic crisis. 12 years before it happened.

    http://www.p-ced.com/1/about/background/

  17. Newsweek: “The Future Won’t Be Free”
    http://www.newsweek.com/id/234123

  18. James Kemp says:

    I’m a Trustee the recently created Nominet Trust, and later this year we will go live with a searchable database containing all of our project evaluations (designed for public consumption). The purpose is simple – best practice, lessons learnt, networking – knowledge sharing.

    Once the service is up and running it will require minimal support, and leave users to exploit the information contained within as best they can. The costs will be off-set by the benefits in terms of grantee and our own effectiveness within a year or so, and accrue year on year.

    The potential for growth is clear, but to begin with we are starting simple, and on the premise that knowledge is power best shared within philanthropy.

  19. James, sounds fascinating. Please do let me know when the database has launched.

  20. James Kemp says:

    I will. It should be mid-May.