Our friend Ernesto over at TorrentFreak is organizing a contest for the best anti-DRM tee-shirt. The entries are now online. If for you DRM equals Digital Restriction Management while it should really mean Digital Rights Management, head over to TorrentFreak and vote for your favorite design.
A while ago Cedric and I met with a very well-known blogger, and as always I tried to slip a plug for Peer Pressure into our conversation. His reaction surprised me, as it basically boiled down to “oh my god I wouldn’t want to be on your blog. You are so harsh with everyone.” That made an impression on me, and since then (believe it or not) I’ve tried to temper my unbridled criticism of other people’s stupidity… at least in public.
That said, Engadget’s commentary on the Apple/EMI decision to make DRM-free tracks available on iTunes really pissed me off. I’m not sure whether they really believe what they wrote or whether they are just trying to stir up controversy, but either way they do a disservice to consumers who are trying to figure out what the announcement actually means.
First of all, they claim that “for years Apple has said that given the choice between DRMed and DRM-free media ecosystems, it would always choose the former.” Unfortunately no supporting evidence is provided for this statement, which contradicts diametrically everything I’ve ever heard on the subject. Consider the follow exchange in the transcript of the Apple/EMI joint press conference with Steve Jobs and EMI CEO Eric Nicoli:
Q: It’s a pretty radical step, Eric. How did you reach the decision to do it? Was it Steve Jobs’ letter that convinced you? Was it the internal surveys you’ve done? What was the moment in which you said, “Damn it, we’re gonna go DRM-free?” And will the extra sales be enough to compensate for the declining physical sales?
A: We’ve always known Steve’s view on the subject, long before his open letter.
The Engadget piece goes on to lament that “we’re still nowhere near there yet” since “the other big labels, Sony BMG, Universal, and Warner, haven’t switched over to DRM-free… With his $4 billion+ stake in the media megacorp [Disney] and his seat on the board of directors, you’d think Jobs would be quick to encourage Disney-owned labels, like Hollywood Records, Lyric Street Records, Mammoth Records, and Walt Disney Records” to release their music DRM-free.
One has to wonder whether the author of the article has ever set foot in a large company. They may speak with one voice, but they certainly don’t think with one mind. Obviously there are huge tensions within these companies as to whether the rewards of eschewing DRM are worth the risks. What’s more, we know that Big Media’s aversion to liberating its content has bordered on the irrational for years. It isn’t like Steve Jobs or anyone else can simply waltz in and demand that they give it all up, $4 billion stake or not (which by the way represents about 5% of Disney at today’s market capitalization, significant but hardly a controlling interest).
They then go onto bitch about the fact that unfettered content is being sold for a higher price. Why didn’t they just do away with the crappy old DRM stuff completely? Could it be (mercy me!) that “Jobs is waiting to see whether this is actually the right move for the business”? And what about video? The article rightly states that Jobs is on record as saying that films “aren’t distributed without DRM at the same frequency of sales as music” and that the same rules might therefore not apply.
Well that’s that then. Like many others I’ve been arguing since this blog’s inception that DRM is one of the biggest factors holding back online media sales. When Steve Jobs proclaimed his opposition to DRM a couple of months ago, I believed him while skeptics put it down to a ploy. After all, everyone knows that without DRM, artists will starve, creativity will die, the sun will set never to rise again, and we’ll spend the rest of our existence listening to Englebert Humperdinck and watching Happy Days reruns.
The only problem with this doomsday scenario is that Apple and EMI announced today that the latter will henceforth be selling DRM-free tracks on iTunes. The price is higher than that of protected tracks by 30% (and higher than it should be, in my opinion, by about 75%) but this is a monumental step in the right direction. Jobs apparently expects that half of tracks sold will be DRM-free by the end of the year. My prediction: the uninfected tracks will sell so much better than the others that we will begin to witness a slow but steady shift to DRM-free content, not just in the music world but for all digital media.
The Free Software Foundation has some intelligent suggestions for steps that Apple could take to back up their claimed anti-DRM stance. I went ahead and signed their electronic petition, which I’m sure has Jobs quaking in his pointy boots.
For years, Apple has had what most cognoscenti consider to be a superior operating system when compared to Windows. Nonetheless, Apple’s market share in the personal computer space has remained stubbornly mired in the low to mid single digits. An article in NetworkWorld argues that Macs may start to experience increased success in the corporate world. The main reason, Apple’s switch to Intel processors, may well have a similar effect in the home market, since the ability to run Windows programs efficiently, when needed, removes one of the few remaining pain points that might be experienced when switching to the Mac.
There are plenty of other reasons to anticipate an uptick in the Mac’s fortunes. The switch to Vista in general is an opportunity to take a step back and consider other options, particularly considering all the problems people are encountering. Moreover, the Apple brand is getting a huge boost from its success in the consumer electronics space, combined with a practical advantage since its phenomenally popular gizmos work best with its own computers.
But what may give Apple the biggest boost is Microsoft’s adoption of the so-called Next-Generation Secure Computing Base in Vista. While this technology ostensibly makes computers more “secure”, what it really does is restrict what you, the user, can do with your own machine. This is particularly useful for — you guessed it — the most obnoxious and intrusive sort of DRM. This reflects an attitude, long palpable at Microsoft, of putting the company’s perceived strategic interests ahead of what users want. Often when using Microsoft software I get the feeling that functionality has been designed with some hidden agenda in mind, although the visible result is simply that end users get annoyed and frustrated.
Apple, on the other hand, has tended to put user experience before all else. Steve Jobs’s famous DRM essay is a case in point. Some may question his motives, but to me this is simply another example of trying to give users what they want (i.e. no DRM). I’ve used Windows exclusively for the past 15 years, but there’s no way in hell I’m going to use a computer infected with Vista and its user-fiendish DRM. Since I don’t actually need to be on Windows anymore, it looks like my next computer will be a Mac.
This quote from Mozilla’s IRC channel makes a biting point about the absurdity of using DRM to prevent consumers from doing what they want:
<bz> there should be rules against copy/pasting code
<Jesse> you could enforce them using DRM
Yesterday I came across two separate articles raising questions about Steve Jobs’s sincerity in his now famous “Thoughts on Music” essay. John Gruber brings up these questions only in order to refute them, referring to two negative reactions to Jobs’s announcement (by Paul Thurott and Paul Kedrosky) and explaining why the authors are dead wrong. Bill Thompson, on the other hand, is firmly in the skeptics’ camp. He simply doesn’t believe that Jobs means what he says when he calls for eliminating DRM.
This skepticism is rooted in the assumption that Apple will never willingly give up the benefits of the iPod/iTunes lock-in it has achieved thanks to its FairPlay DRM. What these critics seem to have forgotten is that the buzz when the iTunes Store was launched was that Apple, having failed to convince the major labels to forgo DRM, had concocted the least intrusive scheme possible out of necessity:
Jobs has been an outspoken opponent of so-called digital rights management (DRM) in the past, arguing that limitations on digital music will undermine the market for legitimate content.
It was only later, when people began to realize the implications of FairPlay on the dynamics of online music sales, that they decided that Steve Jobs, universally heralded as a business genius, must have seen this coming. (I first encountered this view in an article entitled “Convergence Kills” that was as prescient in this regard as it was dead wrong about Apple’s future entry into the telephone market.)
The reality is that Apple does benefit from DRM-induced lock-in, but this comes at a very high price. First of all, more and more people are finally accepting the obvious fact that DRM vastly reduces the size of the overall market for online content sales (Paul Kedrovsky’s boneheaded attitude notwithstanding). Also, the effect of this lock-in is probably exaggerated for the reason cited by Jobs in his article: the vast majority of tracks are still ripped from CD (or downloaded illegally) and are therefore bereft of DRM. Finally, there is a growing backlash against DRM both among the general public and at the governmental level, most notably the legislative action against Apple in a number of European countries that Jobs also mentions.
Seen in this light, it’s easy to imagine what was going through Jobs’s head. Apple was originally against DRM but was forced into it by the record labels. Now that it is perceived as having engineered the whole situation in order to sew up the market for online music, it is suddenly finding itself the primary target of the anti-DRM crowd. Nothing I’ve ever heard or read about Steve Jobs would make me doubt for a second that he would jump on the opportunity to set the record straight.
It’s true that his reasons for eschewing licensing of FairPlay to other parties are a bit thin, but you can hardly blame him when this is clearly the worst of all scenarios for Apple. The status quo at least affords Apple with a strong barrier to competition, whereas a DRM-free world would let Apple compete on its formidable design and engineering merits while getting a (perhaps slightly smaller) piece of a much, much larger pie. Licensing keeps the pie small but eliminates lock-in, so a little dubious spin is perhaps to be expected. But when Jobs says that he would prefer to see DRM go away entirely, I for one believe him.
I’m can’t resist quoting the quote quoted by Techdirt from a quote on the EFF website of an ad run in Capitol Hill newspaper by the Consumer Electronics Association:
“I forsee a marked deterioration in American music…and a host of other injuries to music in its artistic manifestations, by virtue—or rather by vice—of the multiplication of the various music-reproducing machines…” -John Philip Sousa on the Player Piano (1906)
“The public will not buy songs that it can hear almost at will by a brief manipulation of the radio dials.” -Record Label Executive on FM Radio (1925)
“But now we are faced with a new and very troubling assault on our fiscal security, on our very economic life and we are facing it from a thing called the videocassette recorder.”
-MPAA on the VCR (1982)
“When the manufacturers hand the public a license to record at home…not only will the songwriter tie a noose around his neck, not only will there be no more records to tape [but] the innocent public will be made an accessory to the destruction of four industries.”
-ASCAP on the Cassette Tape (1982)
Now compare with the apocalyptic pronouncements put forward by MPAA executive Fritz Attaway to justify stifling consumer choice. Funny, isn’t it?
Anyone remotely interested in what France is doing with the newly voted law on DRM and its impact on Apple must read Christian Paul’s entry on his blog entitled Interoperability: Freedom for consumers and innovators. Christian is one of the author of the interoperable DRM amendment to the much talked about new French law.
About a year ago I had a heated debate with the head of one of the most technically advanced company in the online adult market. I was intellectually interested in this market since the adult industry has always been a test bed for new technologies. We were of course talking about how Peer-to-Peer was the most efficient way to distribute video content and how he could start selling some of his productions for 10$ per file instead of 60$ per DVD.
However, our views diverged very quickly on 2 issues: DRM and device. His goal in life was to ship a set-top box that would connect to a Peer-to-Peer network full of movies loaded with heavy DRM (”to stop the hacker kids from stealing my content”).
I fully disagreed (and still do) with his views. First, his hacker kids can’t afford his $60 movies so he is not losing revenue if they hack it and no DRM is unhackable anyway. So instead of giving freedom to his genuine consumers (who actually might have no ideas on how to get hold of the movies for free), he was prepared to put heavy restrictions on them to protect revenue he would have not booked anyway.
What really got me going was his set-top box vision. He wanted to own the box and that every single consumer of his files would buy the box (yes buy!) and subscribe to various channels where they could buy movies from various producers: “The Ultimate Adult Entertainment Box”. At a time when Personal Computers are turning into media centric devices, why on earth would someone want to add another box in their living room and learn new propriatery software?
We never managed to agree on the above issues and we agreed to stay in touch. He did however give me a couple of sample productions to help me research more about the issues his industry is faced with. I have to say if I were him, I would not spend time and money on DRMising this content. I had seen it all before.
This was one year ago. He still has not launched his DRMed box but more recently I heard of at least two major media companies basing their video distribution strategy on a set top box.
Time to start a new business: Rack-a-Box; the shelves for set-top boxes company.
Build your own rack of boxes for your living-room. Comes in brushed aluminium or wood imitation for your cosy interior. Fully extensible and adjustable. Works for TiVo, VCR, DVD Players, Cable, Video-On-Demand, Games Consoles, Satellite, Adult Boxes and many more! Wanna watch the last blockbuster but don’t have the box from the right company? Just call us. We’ll bring you the shelves extension and the box together. Free basket for remote controls included for any new customer until stock lasts. Only $9.99 per empty shelf.
Our sysadmin Greg, who is French, sent us an article from Le Monde in a mail entitled “AllPeers illégal en France ?” Later in the day, Daniel Glazman gave me a heads up about the same issue. The article brings us the latest and greatest from the French National Assembly’s debate on revisions to their copyright law. I should probably be following this more closely since the action is apparently intense, in that “chaque article, chaque amendement a donné lieu à de longs débats sous l’oeil des internautes et des auteurs” (”every article and every amendment has given rise to long debates under close scrutiny from copyright holders and internet users”).
The article goes on to explain that “le fait d’éditer et de mettre ’sciemment’ à disposition du public un logiciel permettant le téléchargement illégal ‘d’œuvres ou d’objets protégés’ est passible de trois ans d’emprisonnement et 300 000 d’euros d’amende” (”publishing and ‘knowingly’ making available to the public software that enables the illegal downloading of ‘protected works or objects’ is punishable by three years imprisonment and a fine of 300,000 euros”).
My reaction was predictably sanguine. I still don’t believe that anything we’re doing could be construed as illegal. Legislation of this type, in the same way as recent American judicial decisions, is clearly intended to sanction software that is explicitly designed to assist in the illegal transfer of copyrighted works. In fact, the discussion of the amendment in question actually makes reference to MGM vs. Grokster:
Le 27 juin 2005, dans un litige qui opposait les éditeurs de logiciels de peer-to-peer Grokster et StreamCast aux studios Metro-Godwyn-Mayer (MGM), les neuf juges de la Cour suprême des Etats-Unis ont reconnu à l’unanimité la responsabilité de Grokster et Streamcast pour trois motifs : ils encourageaient les utilisateurs à violer le droit d’auteur, n’avaient pas mis en place de dispositif destiné à réduire la réalisation d’actes de contrefaçon, et tiraient un avantage financier de ces contrefaçons.
(”On June 27, 2005, in a case that pitted the vendors of P2P software Grokster and Streamcast against MGM studios, the nine judges of the Supreme Court unanimously recognized the culpability of Grokster and Streamcast for three reasons: they encouraged users to violate copyrights, they did not put into place mechanisms designed to reduce the prevalence of acts of copyright violation and they profited financially from these acts.”)
Needless to say, none of these three points applies to AllPeers.
It’s worth mention that Tristan Nitot, president of Mozilla Europe, has been doing an outstanding job chronicling this drama as it unfolds, and he’s apoplectic about the latest developments. I don’t think either of us needs to worry about incarceration just yet. This isn’t to say that the insanely broad and ambiguous wording of the law is a good thing, but sometimes this can constitute a protection in and of itself. They will never be allowed to apply the law broadly since the consequences would be so manifestly absurd.
That said, let me say just in case that, for any Peer Pressure reader who might want to visit me in French jail: I really prefer pains au chocolat, but I could make do with a chausson aux pommes in a pinch.
Wired is running a terrifying piece about how to build your own PVR and why you soon won’t be able to. The only consolation is that what the media industry is trying to do is so outrageous and against their own interests that one way or another it seems bound to fail. The only questions are how long it will take for this realization to set in, how irrelevant they will be by then and what collateral damage will have been incurred to innocent consumers.
In any case, this article sealed my already strengthening desire to get a PVR set up at my place. I’m just waiting for the wireless version of the extender device to be available. So I’ll doubtless have much to report here once I get that off the ground.
I was planning to put off any predictions until October or so to increase my chance of getting them right, but in the end I decided to bite the bullet and venture a few now.
- The first real mainstream DRM backlash will take place, as consumers realize that music they have bought on various online stores doesn’t play anymore when they buy an MP3 player from another vendor. Apple will make a gesture towards interoperability but try to hold onto its proprietary advantage as long as possible.
- Portable electronic reading devices will begin to make their presence known, and it will finally dawn on forward-thinking publishers that their current business model (subsidizing their online offering by selling pulped dead trees) is doomed to extinction.
- Google will stumble as it struggles to cope with hypergrowth and move beyond its advertising-dominated business model. Its stock price will be lower at year end 2006 than it was when the year began.
- Firefox will break the 20% barrier in browser market share, in large part due to bundling agreements with PC manufacturers.
- At least one application based on Mozilla’s nascent XULRunner platform will achieve widespread adoption.
That’s all I’ve got, folks. Most of the really cool stuff will have to wait until 2007.
Update: Actually here’s another one: despite competition from Digg and other upstarts, Slashdot will remain the king of geek news sites in 2006. Their community and moderation system are simply too well-developed to be easily duplicated. But if they’re smart (note the hedging) they will start to dip their toe in the murky waters of community-driven story selection, perhaps by setting up a special “readers’ picks” page.
In a comment on the Preoccupations blog, Lloyd Shepherd contends that DRM is a sine qua non of legal digital media downloads, using the example of iTunes. I see statements like this all the time, and they always leave me baffled. Why is DRM essential to iTunes? What would happen if there were no DRM? Is the fear that one person would download a song from iTunes and then share it on P2P networks with the rest of the world? If so, how does this differ from the status quo? I can get any song I want from a P2P network already. It strikes me that people buy songs from iTunes for the convenience and peace of mind, neither of which would change one whit if there weren’t any DRM.
The flip side is that I know many people who don’t buy songs from the iTunes store because of the DRM. There’s certainly a chance that Apple would sell less music without DRM, but this isn’t nearly as obvious to me as it appears to be to some others. Frankly I think they would sell more in this scenario.
Update: Lloyd points out that I should have linked to his original blog post.
I don’t usually post naked lists of links, but these bookmarks have been languishing in my browser tabs for ages:
More hope for a DRM-free future, it seems.
Update: Oops, here’s another one:
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