Carr on the Failure of DRM

I have to say, it would be so very awesome if the labels’ fear of iTunes continued dominance, and the bargaining leverage that would represent, led them to sell unprotected MP3s as the only available tactic to sell directly to iPod owners. How delicious.

I have to say, it would be so very awesome if the labels’ fear of iTunes continued dominance, and the bargaining leverage that would represent, led them to sell unprotected MP3s as the only available tactic to sell directly to iPod owners. How delicious.

Tim, I dont believe you understand Carr’s argument. You proceed to beat up DRM on the very consideration Carr calls secondary to DRM, and that leads you into a discussion on policy reform that is obviated by the very market influences that may reduce the proliferation of DRM.

Tim, I dont believe you understand Carr’s argument. You proceed to beat up DRM on the very consideration Carr calls secondary to DRM, and that leads you into a discussion on policy reform that is obviated by the very market influences that may reduce the proliferation of DRM.

I’m sure the debate over the use of copy protection is not over within the music industry, not by a long shot. The dollars-and-cents argument that Carr lays out seems pretty unassailable (and it’s nice to see a business guy like Carr endorsing what copyfighters have been saying for a long time), but for a lot of music industry types, the idea of forfeiting any level of control over their product is simply anethema, no matter how powerful the economic arguments.

I’m sure the debate over the use of copy protection is not over within the music industry, not by a long shot. The dollars-and-cents argument that Carr lays out seems pretty unassailable (and it’s nice to see a business guy like Carr endorsing what copyfighters have been saying for a long time), but for a lot of music industry types, the idea of forfeiting any level of control over their product is simply anethema, no matter how powerful the economic arguments.

Doug, notice that Carr cites profit incentive possibly bringing more MP3s to the market. That sounds like something a former editor of the Harvard Business Review would write about, and something I’m hospitable to. Even though I’m a supporter of DRM, there are times when not leveraging it makes the most business sense.

I did find several points in Carr’s article worth elaborating on; that is, how MP3s are a balance towards DRM the same way that FOSS is to software patents, and the public domain is to biotech gene patents. See here: MP3 as a balance to DRM

Doug, notice that Carr cites profit incentive possibly bringing more MP3s to the market. That sounds like something a former editor of the Harvard Business Review would write about, and something I’m hospitable to. Even though I’m a supporter of DRM, there are times when not leveraging it makes the most business sense.

I did find several points in Carr’s article worth elaborating on; that is, how MP3s are a balance towards DRM the same way that FOSS is to software patents, and the public domain is to biotech gene patents. See here: MP3 as a balance to DRM

Noel, are you under the impression that opposition to DRM is driven by hostility to profit-seeking by businesses? Because I’ve certainly never said anything like that, and I don’t think Doug has either. What I have been saying for the last couple of years is precisely that leveraging DRM doesn’t make business sense. Carr seems to agree with me, at least as far as the music industry is concerned.

Noel, are you under the impression that opposition to DRM is driven by hostility to profit-seeking by businesses? Because I’ve certainly never said anything like that, and I don’t think Doug has either. What I have been saying for the last couple of years is precisely that leveraging DRM doesn’t make business sense. Carr seems to agree with me, at least as far as the music industry is concerned.

Tim, the argument that Carr makes is much more understandable than these cries for “freedom” that simply come off as rants, including your tortured attempts at proposing new business models and then defending them by the fact that they are virtuous rather than profitable.

How do you measure “freedom?” You can’t. “Freedom” campaign slogans are unfalsifiable, irrefutable, immeasureable and unamenable to any objective standard. Profit, however, is different. Because Carr speaks in this language, his arguments supporting the value of MP3s are significantly more persuasive than others I’ve heard.

You still don’t understand Carr’s argument Tim. He agrees little with you except for the fact that MP3s are still part of the industry business model.

Carr is saying that the use of DRM by the iPod is pushing some companies to use MP3. Carr is not arguing that DRM makes no business sense. He is not saying that MP3s would be valuable absent this phenomenon caused by the iPod. Nowhere does Carr imply that all songs will go MP3. If you disagreement, then state exactly how you and Carr align.

Tim, the argument that Carr makes is much more understandable than these cries for “freedom” that simply come off as rants, including your tortured attempts at proposing new business models and then defending them by the fact that they are virtuous rather than profitable.

How do you measure “freedom?” You can’t. “Freedom” campaign slogans are unfalsifiable, irrefutable, immeasureable and unamenable to any objective standard. Profit, however, is different. Because Carr speaks in this language, his arguments supporting the value of MP3s are significantly more persuasive than others I’ve heard.

You still don’t understand Carr’s argument Tim. He agrees little with you except for the fact that MP3s are still part of the industry business model.

Carr is saying that the use of DRM by the iPod is pushing some companies to use MP3. Carr is not arguing that DRM makes no business sense. He is not saying that MP3s would be valuable absent this phenomenon caused by the iPod. Nowhere does Carr imply that all songs will go MP3. If you disagreement, then state exactly how you and Carr align.

Are you really saying that it’s inappropriate and unhelpful to make arguments about freedom while talking about tech policy? I don’t know if you noticed, but this is a libertarian tech policy blog. We tend to talk about freedom a lot here, because many of us consider it to be central to libertarian philosophy. I certainly think profits are a good thing, but that doesn’t mean it’s acceptable to curtail freedom in order to increase companies’ profits.

Are you really saying that it’s inappropriate and unhelpful to make arguments about freedom while talking about tech policy? I don’t know if you noticed, but this is a libertarian tech policy blog. We tend to talk about freedom a lot here, because many of us consider it to be central to libertarian philosophy. I certainly think profits are a good thing, but that doesn’t mean it’s acceptable to curtail freedom in order to increase companies’ profits.

Tim, its helpful to talk about freedom. But at least admit you’re talking about it, rather than disguising your argument as something else. So you come up with these flipsy business models without DRM. And you say they increase your freedom. Then you argue that businesses will be more virtuous for increasing your freedom. But tell me Tim, is increasing your freedom within the incentive of creators? When it helps their profits, right. But you don’t even consider others’ incentives or profits. When talking about what others should do, think of their incentives, or some objective standard, not your own interest- thats a weird form of codependency.

Tim, its helpful to talk about freedom. But at least admit you’re talking about it, rather than disguising your argument as something else. So you come up with these flipsy business models without DRM. And you say they increase your freedom. Then you argue that businesses will be more virtuous for increasing your freedom. But tell me Tim, is increasing your freedom within the incentive of creators? When it helps their profits, right. But you don’t even consider others’ incentives or profits. When talking about what others should do, think of their incentives, or some objective standard, not your own interest- thats a weird form of codependency.

Noel,

While we’re speaking of economic incentives and DRM, why not compare today’s DRM scene in the music and film industry with computer software. When I still used windows (and it wasn’t that long ago) the vast majority of the software I used was only protected by a very simple DRM scheme, that is, a serial number you had to enter. Why is it that software vendors didn’t start using, en masse, more agressive drm schemes like the dongles that you have to plug-in or self-destructing CDs? (Thank god nobody came up with that one.) Could it be that for products (and I include here computer software, music, films, whatever) sold in large volumes to a large fraction of the society, DRM is rather ineffective against piracy? Could it be that the best answer is still to trust your customers and price your products appropriately?

(By the way, sorry if this comes out a bit arrogant. I’m in a rush to go back to work. I’m really trying to make a good argument, not to be purely confrontational.)

Noel,

While we’re speaking of economic incentives and DRM, why not compare today’s DRM scene in the music and film industry with computer software. When I still used windows (and it wasn’t that long ago) the vast majority of the software I used was only protected by a very simple DRM scheme, that is, a serial number you had to enter. Why is it that software vendors didn’t start using, en masse, more agressive drm schemes like the dongles that you have to plug-in or self-destructing CDs? (Thank god nobody came up with that one.) Could it be that for products (and I include here computer software, music, films, whatever) sold in large volumes to a large fraction of the society, DRM is rather ineffective against piracy? Could it be that the best answer is still to trust your customers and price your products appropriately?

(By the way, sorry if this comes out a bit arrogant. I’m in a rush to go back to work. I’m really trying to make a good argument, not to be purely confrontational.)

Actually, Charles you raise a good point. Many labels want Apple to raise the price of songs on iTunes. Knowing that piracy is inevitable, but wanting to pull more profit than their current deal with Apple, some lables have considered releasing their songs on MP3 with the added vulnerability for copying tacked onto the price.

Piracy is here to stay Charles. We all know that. But simply because it occurs, does not mean that attempts to curb it should be abandoned. Mechanisms that allow artists and firms to recoup some money are still important.

Actually, Charles you raise a good point. Many labels want Apple to raise the price of songs on iTunes. Knowing that piracy is inevitable, but wanting to pull more profit than their current deal with Apple, some lables have considered releasing their songs on MP3 with the added vulnerability for copying tacked onto the price.

Piracy is here to stay Charles. We all know that. But simply because it occurs, does not mean that attempts to curb it should be abandoned. Mechanisms that allow artists and firms to recoup some money are still important.

He is not saying that MP3s would be valuable absent this phenomenon caused by the iPod

What in the world does this mean?

How do you measure “freedom?” You can’t.

Ummmm, no. Maybe you can’t use an interval or ratio scale, but you can say, for instance, that a legal regime allowing me to accessand distribute code-breaking tools offers greater freedom than a legal regime that doesn’t allow me to distribute such tools.

Note: this is MY freedom I am talking about, not the hypothetical interest of some corporation. When MY freedom is curbed in the name of curbing piracy, and it’s patently clear to everyone that piracy isn’t being curbed, then why is it inappropriate to want the law changed so I can have MY freedom back?

Also, for those unfamiliar with American vernacular speech, the term “dollars-and-cents” generally refers to the profit motive.

>> He is not saying that MP3s would be valuable absent this phenomenon caused by the iPod

What in the world does this mean?

>> How do you measure “freedom?” You can’t.

Ummmm, no. Maybe you can’t use an interval or ratio scale, but you can say, for instance, that a legal regime allowing me to accessand distribute code-breaking tools offers greater freedom than a legal regime that doesn’t allow me to distribute such tools.

Note: this is MY freedom I am talking about, not the hypothetical interest of some corporation. When MY freedom is curbed in the name of curbing piracy, and it’s patently clear to everyone that piracy isn’t being curbed, then why is it inappropriate to want the law changed so I can have MY freedom back?

Also, for those unfamiliar with American vernacular speech, the term “dollars-and-cents” generally refers to the profit motive.

The last post is mine. I also want to note that in that post, “Ummmmm…no” means “Ummmmm..you’re wrong.”

The last post is mine. I also want to note that in that post, “Ummmmm…no” means “Ummmmm..you’re wrong.”

Doug, did you look at Carr’s article. He argued that the iPod’s DRM model may cause services other than iTunes to revert to MP3. Thus, the value of MP3 is that it offers the opportunity for services to sell songs that can play on the iPod. I question some of this assertion, as I state in my review on IPcentral.

Carr’s reasoning is interesting, and I have no normative argument on whether MP3s are good in this situation. But as a supporter of DRM, I am sympathetic to the increased use of MP3 if there is economic justification, as Carr argues may be the case.

I disagree with your depiction of DRM. First, as Carr points out, DRM is a business strategy. Second, curbing piracy does not need to stop all piracy. If you don’t think DRM is effective at all, then how do you explain the annual revenue of iTunes. Users could have gotten those songs off file-shares rather than buying them.

Doug, did you look at Carr’s article. He argued that the iPod’s DRM model may cause services other than iTunes to revert to MP3. Thus, the value of MP3 is that it offers the opportunity for services to sell songs that can play on the iPod. I question some of this assertion, as I state in my review on IPcentral.

Carr’s reasoning is interesting, and I have no normative argument on whether MP3s are good in this situation. But as a supporter of DRM, I am sympathetic to the increased use of MP3 if there is economic justification, as Carr argues may be the case.

I disagree with your depiction of DRM. First, as Carr points out, DRM is a business strategy. Second, curbing piracy does not need to stop all piracy. If you don’t think DRM is effective at all, then how do you explain the annual revenue of iTunes. Users could have gotten those songs off file-shares rather than buying them.

Noel: “But simply because it occurs, does not mean that attempts to curb it should be abandoned. Mechanisms that allow artists and firms to recoup some money are still important.”

I agree, but as you point out, DRM is a business model that seeks to curb piracy and increase revenues. I don’t believe that business models should be written into law, which is what part of the DMCA does. I’m not advocating that we legally ban DRM. Business should do as they please. I just don’t think we should push the market one way or another through legal means. (Although this is slightly beyond the scope of this discussion).

“If you don’t think DRM is effective at all, then how do you explain the annual revenue of iTunes. Users could have gotten those songs off file-shares rather than buying them.”

My answer to this is convenience. People who buy an iPod often install the software along with it (and as I’ve discovered, even if you don’t buy an iPod, you may well end up with that damned thing on your computer) and it becomes convenient to buy the songs from there. Dowloading the songs illegally still requires effort. Not much, but still requires effort. When napster shuts down, you have to find who will pick up the ball and run. That requires time and that is worth money. I believe most people who downloaded songs illegally in the time of napster were doing so because it was convenient, not because they absolutely wanted to break the law and make a point. File-sharing was introduced to the mass market and it became a convenient social phenomenon. Note that this is, in part, due to the large labels who have over the years crushed efforts of companies to come up with morally acceptable and, most probably, legally sound ways of purchasing music online (or at least enjoying music you purchased using digital medium). So long story short, my point is that Apple made iTunes convenient by distributing all you needed to buy off them in a convenient fashion with the iPod you bought. They also sold music at a somewhat reasonnable price and in interesting conditions by allowing you to purchase a single song. That’s my explanation to the success of iTunes, not DRM, but convenience. Unfortunately, this happened with some amount of vendor lock-in.

If I was going to venture a guess as to what the future holds, I would say the following:

-People have figured out that mp3s is not synonymous with illegality, it’s just a file format; -People are also realizing that DRM is annoying and pretty much useless against piracy; -Online stores will start selling mp3s directly (the one I love most from an ideological standpoint is http://www.audiolunchbox.com. They don’t appropriate rights and artists get a large share of the sale price. Anyway, besides the point.) -Having an iPod will become less important, because you will now be able to buy music conveniently from a large number of sources and you’ll be able to shift it from one device to another without problems. -More vendors will make more devices that are comparable to the iPod. -More stores… -More devices… you get the picture.

My real question is “When/if that happens, will iTunes start selling non-drm mp3s?”

Noel:
“But simply because it occurs, does not mean that attempts to curb it should be abandoned. Mechanisms that allow artists and firms to recoup some money are still important.”

I agree, but as you point out, DRM is a business model that seeks to curb piracy and increase revenues. I don’t believe that business models should be written into law, which is what part of the DMCA does. I’m not advocating that we legally ban DRM. Business should do as they please. I just don’t think we should push the market one way or another through legal means. (Although this is slightly beyond the scope of this discussion).

“If you don’t think DRM is effective at all, then how do you explain the annual revenue of iTunes. Users could have gotten those songs off file-shares rather than buying them.”

My answer to this is convenience. People who buy an iPod often install the software along with it (and as I’ve discovered, even if you don’t buy an iPod, you may well end up with that damned thing on your computer) and it becomes convenient to buy the songs from there. Dowloading the songs illegally still requires effort. Not much, but still requires effort. When napster shuts down, you have to find who will pick up the ball and run. That requires time and that is worth money. I believe most people who downloaded songs illegally in the time of napster were doing so because it was convenient, not because they absolutely wanted to break the law and make a point. File-sharing was introduced to the mass market and it became a convenient social phenomenon. Note that this is, in part, due to the large labels who have over the years crushed efforts of companies to come up with morally acceptable and, most probably, legally sound ways of purchasing music online (or at least enjoying music you purchased using digital medium). So long story short, my point is that Apple made iTunes convenient by distributing all you needed to buy off them in a convenient fashion with the iPod you bought. They also sold music at a somewhat reasonnable price and in interesting conditions by allowing you to purchase a single song. That’s my explanation to the success of iTunes, not DRM, but convenience. Unfortunately, this happened with some amount of vendor lock-in.

If I was going to venture a guess as to what the future holds, I would say the following:

-People have figured out that mp3s is not synonymous with illegality, it’s just a file format;
-People are also realizing that DRM is annoying and pretty much useless against piracy;
-Online stores will start selling mp3s directly (the one I love most from an ideological standpoint is http://www.audiolunchbox.com. They don’t appropriate rights and artists get a large share of the sale price. Anyway, besides the point.)
-Having an iPod will become less important, because you will now be able to buy music conveniently from a large number of sources and you’ll be able to shift it from one device to another without problems.
-More vendors will make more devices that are comparable to the iPod.
-More stores…
-More devices…
you get the picture.

My real question is “When/if that happens, will iTunes start selling non-drm mp3s?”

Doug, did you look at Carr’s article.

You mean the one that is titled “Curtains for Music DRM?” The one that is only 8 paragraphs long – short enough to read on a BlackBerry? No, I didn’t look at it. I like to comment on things I haven’t seen. I like looking like a dumbass.

Sheesh.

I disagree with your depiction of DRM.

I have no depiction of DRM. I think it’s a marketing term and I generally don’t use it. I could care less whether companies use encryption to restrict copying, if that’s what you mean by DRM. I am against the anti-circumvention clause of the DMCA. It reduces my freedom as a software user and developer.

If you don’t think DRM is effective at all, then how do you explain the annual revenue of iTunes. Users could have gotten those songs off file-shares rather than buying them.”

This statement really brings to mind the old adage “Never argue with an idiot because you will end up with two idiots.” Goodbye. I am going to go off and not read some more articles.

>> Doug, did you look at Carr’s article.

You mean the one that is titled “Curtains for Music DRM?” The one that is only 8 paragraphs long – short enough to read on a BlackBerry? No, I didn’t look at it. I like to comment on things I haven’t seen. I like looking like a dumbass.

Sheesh.

> I disagree with your depiction of DRM.

I have no depiction of DRM. I think it’s a marketing term and I generally don’t use it. I could care less whether companies use encryption to restrict copying, if that’s what you mean by DRM. I am against the anti-circumvention clause of the DMCA. It reduces my freedom as a software user and developer.

> If you don’t think DRM is effective at all, then how do you explain the annual revenue of iTunes. Users could have gotten those songs off file-shares rather than buying them.”

This statement really brings to mind the old adage “Never argue with an idiot because you will end up with two idiots.” Goodbye. I am going to go off and not read some more articles.

See Fred von Lohmann post “DRM Fading for Music: The Year in Review” on the Electronic Frontier Foundation’s website. http://www.eff.org/deeplinks/

Fred wrote “Almost exactly one year ago, I predicted the beginning of the end for DRM on digital music. Now EMI has announced the release of the new Norah Jones single on Yahoo! Music in DRM-free MP3 format (many will remember that Yahoo! has been urging the major labels to give up DRM).”

See Fred von Lohmann post “DRM Fading for Music: The Year in Review” on the Electronic Frontier Foundation’s website. http://www.eff.org/deeplinks/

Fred wrote “Almost exactly one year ago, I predicted the beginning of the end for DRM on digital music. Now EMI has announced the release of the new Norah Jones single on Yahoo! Music in DRM-free MP3 format (many will remember that Yahoo! has been urging the major labels to give up DRM).”

Doug, if you want to side-step my example of iTunes and how DRM has lead to legitimate music sales, then fine. Charles provided a better response anyways. I guess suffering from lack of freedom, as you claim you are, has lead you into a rant of sorts:)

Charles, again you raise some good points. I don’t see why iTunes would sell non-DRMd songs though unless Apple finds itself in the position that it wants iTunes songs on non-iPod players.

Steve, its a bit ridiculous for von Lohmann to cite Yahoo!’s call for the end of DRM. Yahoo! is looking out for its own interest, not that of content owners. Its like Dell and other computer makers calling for Microsoft to slash the price of Windows in half.

Doug, if you want to side-step my example of iTunes and how DRM has lead to legitimate music sales, then fine. Charles provided a better response anyways. I guess suffering from lack of freedom, as you claim you are, has lead you into a rant of sorts:)

Charles, again you raise some good points. I don’t see why iTunes would sell non-DRMd songs though unless Apple finds itself in the position that it wants iTunes songs on non-iPod players.

Steve, its a bit ridiculous for von Lohmann to cite Yahoo!’s call for the end of DRM. Yahoo! is looking out for its own interest, not that of content owners. Its like Dell and other computer makers calling for Microsoft to slash the price of Windows in half.

Noel: Again you use unsustainable logic. First, the so-called content owners are attempting to protect their own interests, not the interests of Yahoo or other consumers. Clearly, if one group (A) claims that their interests must be protected at the expense of another group (B), why should the other group (B) care about protecting A’s interests? The so-called content owners are attempting through DRM/DCMA to eliminate the concept of “fair-use”. Furthermore, the so-called content owners believe that they have the right to intrude (trespass) onto your computer to “enforce” their so-called rights. Seems to raise a due process concern to me. The logical conclusion: if the content owners do not feel constrained by any ethical principals then they do not deserve the respect of the potential users of their content.

Noel: Again you use unsustainable logic. First, the so-called content owners are attempting to protect their own interests, not the interests of Yahoo or other consumers. Clearly, if one group (A) claims that their interests must be protected at the expense of another group (B), why should the other group (B) care about protecting A’s interests? The so-called content owners are attempting through DRM/DCMA to eliminate the concept of “fair-use”. Furthermore, the so-called content owners believe that they have the right to intrude (trespass) onto your computer to “enforce” their so-called rights. Seems to raise a due process concern to me. The logical conclusion: if the content owners do not feel constrained by any ethical principals then they do not deserve the respect of the potential users of their content.

Steve,

Yes, content owners protect their interests. My statement about Yahoo! is that its protecting its own as well, and thus Yahoo!’s position on DRM should not be taken as a disinterested view. EFF is not necessarily misleading, but its citation of Yahoo! may be misinterpreted.

Steve, you raise the issue of fair use, which I think is very important. I’m a strong supporters of DRM and the DMCA, but most of my writings on fair use probably are not far from yours. I will say though that if fair use is the issue, then talk about fair use, not “freedom” or other swooshy concepts that are used to evade the substantive issues.

You have to be more specific about “unethical” principals on the part of content owners, but I will say that if you don’t agree with someone’s business practices, don’t buy their product and don’t ask to get it on your own terms.

Steve,

Yes, content owners protect their interests. My statement about Yahoo! is that its protecting its own as well, and thus Yahoo!’s position on DRM should not be taken as a disinterested view. EFF is not necessarily misleading, but its citation of Yahoo! may be misinterpreted.

Steve, you raise the issue of fair use, which I think is very important. I’m a strong supporters of DRM and the DMCA, but most of my writings on fair use probably are not far from yours. I will say though that if fair use is the issue, then talk about fair use, not “freedom” or other swooshy concepts that are used to evade the substantive issues.

You have to be more specific about “unethical” principals on the part of content owners, but I will say that if you don’t agree with someone’s business practices, don’t buy their product and don’t ask to get it on your own terms.