Ideas on Intellectual Property Issues

The underlying problem with Books, Software, Music, Film etc… is
1. They can be copied
2. Nobody is going to pay a huge amount for one copy
3. If everyone copies the first copy and nobody pays then there is no incentive for the artist/programmer to go to all the trouble.
I tried to imagine what would happen to the intellectual property industry if you did away with copyright and patents. Intuitively, it seems there would be no incentive to produce. Or would there?
Then I thought that actually the demand for the stuff will be just as great. The problem in the digital age is that as soon as you have one IP good, you have a virtually infinite number. So the rules of supply and demand of normal goods don’t apply any more.
But if you look closer, I think there is a way. Looking at how the dynamics of supply and demand work in this case. Basically until the first item is produced, the demand is very high (as high as it would be with non digital items). But as soon as the first item is produced and distributed, the supply becomes effectively infinite so that the value is completely lost.
So the solution is to concentrate the economics on the first item. Here’s how:
My solution is advance commissions.
1. Artists/programmers do one or 2 items for free (or get whatever they can from sales of copiable media) to the point where people know they are good. For example JK Rowling writes the first in the Harry Potter Series.
2. Once a reputation has been established they sit back and say. OK folks, if you want any more, you have to pay. I’m not writing another Harry Potter/Singing another Spice Girls song, till I have $x in my bank account. Once I have, the content will be distributed for free on the internet. Lots of people can contribute small amounts of money and when the amount is reached, the content is distributed.
This way, the artists are rewarded (but to a fixed degree which they can decide on) and you don’t need to get into all this paranoid Digital Rights protection stuff which IMHO is never going to work but is going to piss a lot of people off.
Potential Problems
1. What if the guy takes the money and runs? (Certify that we have the item written but in a safe or something)
2. The “my $10 isn’t going to make the difference” so I won’t bother syndrome (same problem with the environment – whether I drive an SUV or not won’t change global warming so it’s not worth making the effort – bad reasoning if you ask me)