How Kickstarter allows companies to "double-dip" their fans.

The Double Fine logo, consisting of a two-head...

The recent monumental successes of both the Double Fine and the Order of the Stick crowdfunding has also kickstarted (Beware the puns!) some heated discussions between my group of friends and myself on what the ethical thing to do is, once the project exceeded the requested amount by that much.

Regular readers (with amazing memories) might remember me writing on this issue a while ago, but the recent heated discussions prompted me to explore this issue once more and perhaps go into more depth into how this applies to non-software projects such as the Order of the Stick comic.

First of all, I should explain what my criticism is:

I believe that the only ethical thing to do, once you decide that you want your project to be funded by the public, is to make the end result public as well. The reason I find this the fair thing to do, is because by crowdfunding your project you take away the actual risk of developing a new product, and thus it makes no sense to take advantage of a system which rewards you based on the expectation that you took such a risk.

In this case, that system is copyrights and the capitalist markets. The expectation in the current world is that a creative project was started by a person or a group of people, who took a risk in creating something and then trying to make a living out of selling copies of it (I’m not going to criticise the expectations themselves1 but rather take them at face value for now.) This is where copyrights come in at their theoretical level. Copyright’s purpose is to incentivize new creative works, by giving a state-provided way for their creators to monetize them once they’ve been created.  Thus someone who took a successful risk in judging what popular demand is can get fabulously compensated for it2.

But if copyrights are supposed to be the incentive for creating new works of art, then it makes no sense to provide them for crowdfunded projects, since there that incentive has already been provided by the crowd “patrons” of the project. People have already provided a monetary incentive for the creator which has also taken away all the risk.

For the creator to now take the finish project and monetize it as if they took all the risk and required the incentive of copyrights to do so, is unethical.

What would be the ethical thing to do? Try to circumvent copyrights you did not have to rely upon and release the work into the commons, once all your costs have been repaid. Release it as free software if it’s software, or release it in the creative commons with the most permissive license if it’s anything else.

But what is happening here, is that the creators have to work with such lowered expectations from their audience, that they can easily get away with what see as straightforward double dipping. The creators not only get a significant part (if not all) of their costs covered, and once the project is finished, the get to keep any and all profits from the sales of copies the product as well. They get to have their cake and eat it too.

People criticise me at this point by reminding me that the fans knew what they were getting into when they agreed to fund these projects, and that makes everything OK. I do not think that’s a good excuse. First of all, people voluntarily give their money to many causes and projects, but that does not mean that every such cause is ethical. Not only do people act irrationally in most economic decisions, but I find that the moral imperatives also change when we’re talking about these amounts.

It is one thing not to expect a project to be released for free when you’re only funding just 5% of its total cost, but here we’re talking about projects who’ve been funded 100% and possibly more. When the crowdfunding success is that big, when the mutual aid sentiments are that great from your fans, the creators have a duty to modify what they give back to the community just as much. But instead what I continuously see happening is that the extra rewards are something that will make the creators even more money!

For example, the Order of the Stick (OotS) kickstart required something like 60.000$ to work. They got 20 times this amount last time I checked. The original result of the crowdfunding would have been one book being able to be reprinted. With 20 times the amount, it’s going to be 5 books and a board game. I.e. the cost and risk of these reprints is being taken over by the community, while the author gets to keep the profits. And everyone is too far caught up in the euphoria of the project’s success to notice that they just made the author practically a millionaire overnight and in return got the opportunity to buy some new books in the future.

I’m told this is a fair deal because they agreed to the original plan.

Now I have to clarify that I have nothing against rewarding the creators of such works, especially when people like Burlew have been releasing their comic for free online for a long while (which they monetized in other ways already, but that’s beside the point). I’m very happy for the success of these projects, but I can’t avoid seeing the reality of the situation just as well.

When there is such overwhelming support for the creators to create new works, to take advantage of an artificial monopoly granted by the state via threats of violence (copyrights) as if it was a required incentive as well is an abuse of the goodwill of your fans, even if those fans are too starstruck or privileged to realise it.  And I just can’t ignore this “double-dipping”.

I am cynical enough to fully expect that now that new roads have been paved by the pioneers and the indies of the creative world, the big companies will also start dipping their toes into the crowdsourcing pot. We’ll see giants like Activision offering carrots of classic and loved IPs such as Dungeon Keeper or Descent to crowdfunding, so that they can get some money upfront and only then start working on these titles, with either reduced risk, or completely risk-free. And why shouldn’t they? They will develop an IP with some money upfront and then sell it back to the people who already funded it.

And because the expectations of everyone for the rewards crowdsourcing will be for the public are so low, these companies may cynically abuse this concept, until the burn out the crowdfunding goodwill.

Alternatively, I hope that now that crowd funding is gaining momentum, we’ll see perhaps a sort of competition between projects for these funds, and eventually those projects which promise full ownership to the crowd that funds them will be seen as the better offer, while the others are ignored. This is my optimistic scenario.

  1. I will only say that they are very wrong. Perhaps I will explore this in another post. []
  2. while those who didn’t get to starve, but that’s another issue now isn’t it? []