© Priya Narayanan, Assistant Professor of Marketing, IIM Kozhikode. Views are personal.

Recently, I attended a talk by Russell Belk who is arguably the most authoritative figure in research on the relationship between possessions and people. Belk’s work, beginning with his classic paper of 1988 marks the beginning of an era of understanding what our possessions, the objects we own, mean to us, and how they mark our “extended selves.” In this article, I discuss ideas of sharing, owning, the sharing economy of today, and what all of this means for digital goods.

With advances in research, our understanding of possessions gained clarity and became a topic worth studying. Belk has done work on other topics such as materialism, sharing, gift giving, possessions in the digital world, and a variety of cross cultural research. Among all these topics, Belk chose to talk about sharing and materialism, among others. Some of his thoughts are worth repeating, analyzing, and criticizing, hence this article.

Belk suggests that distribution of products or services can be done in at least three ways: marketplace exchange (usually with a quid pro quo of money), gifting (usually without a quid pro quo, but some obligation does arise), and sharing (which is often non-reciprocal and altruistic). This leads to the question: does the sharing economy of today, the vaunted twenty-first century philosophy of renting and accessing rather than buying and possessing (think Uber instead of Ford), involve true sharing? My view is that there is no genuine sharing in the sharing economy. There is only an absence of possession as defined by the traditional use of the word possession to mean ownership.

The traditional economy was the possession economy (you need to own a car in order to ride a car) and today’s is the concession economy (an app gives you the concession or authorization to ride a car). What has changed is not the presence or absence of ownership, but with whom the ownership rests. Earlier, cars used to be owned privately, but now they are owned by an organization that decides whether and when to let you ride them, and whether to make you pay more than the ride’s worth through surge pricing and premium services.

Not all private ownership has been replaced by organizational ownership. There are products and services that were earlier owned by individuals and are now owned collectively, albeit only by a section of society. Think of the services in a gated community – security, housekeeping, laundry/ironing of clothes, gardening, and so on. What used to be paid for with wages from private hands is today paid out from the gated community’s fund which every family contributes to. Whether the community is gated in order to keep outsiders outside or insiders within the cocoon of pseudo-safety is a moot question.

Then again, there is another object (if it could be called that) that defies most norms of possession and ownership: digital goods. Digital goods are perfectly non-rivalrous in that they can be copied infinite number of times and each copy will be the same, each copy of the song will provide the same melody to every ear. Of course, some people might lose some enjoyment from the idea that there are more than twenty other people who can hear the same song, but this is not the point of this discussion.

For a non-rivalrous product, the biggest problem (which we now face), and the biggest advantage (the boon promised by computers and the internet) is that it cannot be tied to a corner and flogged to spout money the way a rivalrous product can be. Disney’s amusement parks can be built and sold behind closed gates but the Disney movie Frozen will flow through digital 1s and 0s across the vast sea of the internet, unless it is carefully bottled up like a genie.

How, then, do we own something in the digital world? After all, the digital object exists wherever it is copied to. This is where we need the notion of copyright, which can act as fences to corral wild horses that refuse to be saddled. And we cry foul when we see violation of copyright.

To the extent that digital goods came into existence when they were created by somebody in the first place, they are like standard goods and products. But when a copy of a digital product is made, who owns it? Yes, the originator holds the copyright still, but that only acknowledges the intellect or artistic talent that created the digital product and is not ownership in the true sense. In that case, can the copy be deemed to belong to the person who paid for it? But the seller did not incur any reduction in the number of copies that could be sold after selling one copy, which implies that the seller could have given the copy for free. To take the argument to its logical end, all digital goods need to be copyrighted but should be not sold for material benefit. Of course, initial copies might be priced above zero in order to provide a living for the intellectual or the artist who created the digital product.

Clearly, the digital world has raised issues of sharing, owning, and possession that did not exist earlier. While academic research can view farther by standing on the shoulders of giants such as Belk, managers and copyright holders need to think harder about what asset they own and how they want to provide real customer value through that asset.