Two developments threaten future of intellectual property rights. One is Internet. Academics, fed up with monopolistic practices of professional publications - already publish on web in big numbers. I published a few book on Internet and they can be freely downloaded by anyone who has a computer or a modem. The full text of electronic magazines, trade journals, billboards, professional publications, and thousands of books is available online. Hackers even made sites available from which it is possible to download whole software and multimedia products. It is very easy and cheap to publish on Internet, barriers to entry are virtually nil. Web pages are hosted free of charge, and authoring and publishing software tools are incorporated in most word processors and browser applications. As Internet acquires more impressive sound and video capabilities it will proceed to threaten monopoly of record companies, movie studios and so on.

The second development is also technological. The oft-vindicated Moore's law predicts doubling of computer memory capacity every 18 months. But memory is only one aspect of computing power. Another is rapid simultaneous advance on all technological fronts. Miniaturization and concurrent empowerment by software tools have made it possible for individuals to emulate much larger scale organizations successfully. A single person, sitting at home with 5000 USD worth of equipment can fully compete with best products of best printing houses anywhere. CD-ROMs can be written on, stamped and copied in house. A complete music studio with latest in digital technology has been condensed to dimensions of a single chip. This will lead to personal publishing, personal music recording, and to digitization of plastic art. But this is only one side of story.

The relative advantage of intellectual property corporation does not consist exclusively in its technological prowess. Rather it lies in its vast pool of capital, its marketing clout, market positioning, sales organization, and distribution network.

Nowadays, anyone can print a visually impressive book, using above-mentioned cheap equipment. But in an age of information glut, it is marketing, media campaign, distribution, and sales that determine economic outcome.

This advantage, however, is also being eroded.

First, there is a psychological shift, a reaction to commercialization of intellect and spirit. Creative people are repelled by what they regard as an oligarchic establishment of institutionalized, lowest common denominator art and they are fighting back.

Secondly, Internet is a huge (200 million people), truly cosmopolitan market, with its own marketing channels freely available to all. Even by default, with a minimum investment, likelihood of being seen by surprisingly large numbers of consumers is high.

I published one book traditional way - and another on Internet. In 50 months, I have received 6500 written responses regarding my electronic book. Well over 500,000 people read it (my Link Exchange meter registered c. 2,000,000 impressions since November 1998). It is a textbook (in psychopathology) - and 500,000 readers is a lot for this kind of publication. I am so satisfied that I am not sure that I will ever consider a traditional publisher again. Indeed, my last book was published in very same way.

The demise of intellectual property has lately become abundantly clear. The old intellectual property industries are fighting tooth and nail to preserve their monopolies (patents, trademarks, copyright) and their cost advantages in manufacturing and marketing.

But they are faced with three inexorable processes which are likely to render their efforts vain:

The Newspaper Packaging

Print newspapers offer package deals of cheap content subsidized by advertising. In other words, advertisers pay for content formation and generation and reader has no choice but be exposed to commercial messages as he or she studies content.

This model - adopted earlier by radio and television - rules internet now and will rule wireless internet in future. Content will be made available free of all pecuniary charges. The consumer will pay by providing his personal data (demographic data, consumption patterns and preferences and so on) and by being exposed to advertising. Subscription based models are bound to fail.

Thus, content creators will benefit only by sharing in advertising cake. They will find it increasingly difficult to implement old models of royalties paid for access or of ownership of intellectual property.

Disintermediation

A lot of ink has been spilt regarding this important trend. The removal of layers of brokering and intermediation - mainly on manufacturing and marketing levels - is a historic development (though continuation of a long term trend).

Consider music for instance. Streaming audio on internet or downloadable MP3 files will render CD obsolete. The internet also provides a venue for marketing of niche products and reduces barriers to entry previously imposed by need to engage in costly marketing ("branding") campaigns and manufacturing activities.

This trend is also likely to restore balance between artist and commercial exploiters of his product. The very definition of "artist" will expand to include all creative people. One will seek to distinguish oneself, to "brand" oneself and to auction off one's services, ideas, products, designs, experience, etc. This is a return to pre-industrial times when artisans ruled economic scene. Work stability will vanish and work mobility will increase in a landscape of shifting allegiances, head hunting, remote collaboration and similar labour market trends.

Market Fragmentation

In a fragmented market with a myriad of mutually exclusive market niches, consumer preferences and marketing and sales channels - economies of scale in manufacturing and distribution are meaningless. Narrowcasting replaces broadcasting, mass customization replaces mass production, a network of shifting affiliations replaces rigid owned-branch system. The decentralized, intrapreneurship-based corporation is a late response to these trends. The mega-corporation of future is more likely to act as a collective of start-ups than as a homogeneous, uniform (and, to conspiracy theorists, sinister) juggernaut it once was.

Sam Vaknin is the author of Malignant Self Love - Narcissism Revisited and After the Rain - How the West Lost the East. He is a columnist for Central Europe Review, United Press International (UPI) and eBookWeb and the editor of mental health and Central East Europe categories in The Open Directory and Suite101.

Web site:

The Scale of Problem

According to a 1996 IMF estimate, money laundered annually amounts to 2-5% of world GDP (between 800 billion and 2 trillion US dollars in today's terms). The lower figure is considerably larger than an average European economy, such as Spain's.

The System

It is important to realize that money laundering takes place within banking system. Big amounts of cash are spread among numerous accounts (sometimes in free economic zones, financial off shore centers, and tax havens), converted to bearer financial instruments (money orders, bonds), or placed with trusts and charities. The money is then transferred to other locations, sometimes as bogus payments for "goods and services" against fake or inflated invoices issued by holding companies owned by lawyers or accountants on behalf of unnamed beneficiaries. The transferred funds are re-assembled in their destination and often "shipped" back to point of origin under a new identity. The laundered funds are then invested in legitimate economy. It is a simple procedure - yet an effective one. It results in either no paper trail - or too much of it. The accounts are invariably liquidated and all traces erased.

Why is it a Problem?

Criminal and tax evading funds are idle and non-productive. Their injection, however surreptitiously, into economy transforms them into a productive (and cheap) source of capital. Why is this negative?

Because it corrupts government officials, banks and their officers, contaminates legal sectors of economy, crowds out legitimate and foreign capital, makes money supply unpredictable and uncontrollable, and increases cross-border capital movements, thereby enhancing volatility of exchange rates.

A multilateral, co-ordinated, effort (exchange of information, uniform laws, extra-territorial legal powers) is required to counter international dimensions of money laundering. Many countries opt in because money laundering has also become a domestic political and economic concern. The United Nations, Bank for International Settlements, OECD's FATF, EU, Council of Europe, Organisation of American States, all published anti-money laundering standards. Regional groupings were formed (or are being established) in Caribbean, Asia, Europe, southern Africa, western Africa, and Latin America.

(continued)

Sam Vaknin is the author of Malignant Self Love - Narcissism Revisited and After the Rain - How the West Lost the East. He is a columnist for Central Europe Review, United Press International (UPI) and eBookWeb and the editor of mental health and Central East Europe categories in The Open Directory and Suite101.

Web site: