The New York Times has an article on the Zune that puts DRM issues front and center:
Rather than selling songs in a closed-file format like Zune or FairPlay from Apple, eMusic uses the MP3 format, which works on all devices. Though dwarfed by iTunes’ 72 percent market share, eMusic’s 10 percent share (as measured by the research firm NPD Group) beats all other stores, including Napster, Rhapsody and Wal-Mart. And eMusic might do even better if it offered songs from the four major record labels–EMI, Sony BMG, Universal and Warner–that control about 75 percent of the music market.
Aside from some small experiments, the majors do not use the MP3 format because it lacks the digital rights management, or D.R.M., technology that protects copyrighted works by preventing unlimited duplication.
It’s great that they’re putting the spotlight on the problems created by DRM, but that last sentence is highly misleading. It’s true that DRM is intended to prevent unlimited duplication, but it seems to be stretching the truth to flatly state that it succeeds in doing so. At best, I think you could say that it slightly delays unlimited duplication because it sometimes takes a few hours before someone goes to the trouble of cracking their copy and uploading it to a peer-to-peer network.
Via Slashdot, here’s more evidence that open source community has reason to be concerned about the Novell/Microsoft agreement. In a question-and-answer session at a SQL Server conference, Microsoft CEO Steve Ballmer said:
Interoperability is always good for the customer, and it’s important. And we know customers want the interoperability that the hands showed between the Windows world and the Linux world.
“We’ve had an issue, a problem that we’ve had to confront, which is because of the way the GPL (General Public License) works, and because open-source Linux does not come from a company–Linux comes from the community–the fact that that product uses our patented intellectual property is a problem for our shareholders. We spend $7 billion a year on R&D, our shareholders expect us to protect or license or get economic benefit from our patented innovations. So how do we somehow get the appropriate economic return for our patented innovation, and how do we do interoperability. The truth is, because of the complex licensing around the GPL, we actually didn’t want to do one without the other.
I think this is a case where language has become a serious impediment to clear thinking about these issues. When Ballmer says that Linux “uses our patented intellectual property,” he almost certainly does not mean that Linux is in any way derived from Microsoft products, or that the people making Linux have somehow been free-riding off of Microsoft’s R & D efforts. Linux developers have repeatedly stated that Microsoft needs only to point out the infringing lines of code, and the Linux team will rip them out and replace them with code they write from scratch.
Back in Part 5 of this series last April, I discussed the looming breakup of radio giant Clear Channel. And now that day is here. According to Frank Ahrens of the Washington Post, Clear Channel “has agreed to sell the company to a consortium of private-equity firms and plans to shear off more than one-third of its 1,150 radio stations, dismantling a giant that dominated the industry and became the bogyman of media consolidation for the past half-decade.” Moreover, “In a separate transaction also announced yesterday, Clear Channel said it would seek buyers for all of its television stations and 448 of its smaller radio stations,” mostly in smaller markets.
Again, don’t expect the Chicken Little media critics to acknowledge any of this. As I’ve said again and again in this ongoing series, this is an example of a well-functioning, competitive marketplace at work. Media critics think every merger or acquisition is all just part of some sort of grand conspiracy to destroy democracy or competition. But when the opposite happens and firms reorganize or downsize, the critics never say a peep.
In the end, regardless of what ownership patterns and structures look like, markets sort things out and we end up with an ever-expanding universe of media options at our disposal. In sum, despite what the Chicken Littles predict, the sky never falls. Seriously, ask yourself a simple question: Do you have more media options and outlets at your disposal today than you did 5 to 10 years ago? Read my last book if you want to see the evidence.
Tim, Steve and others go after me below in an interesting exchange on compatibility and standards. I thought I’d start a new post on this to highlight this exchange and let people really sink their fangs into me since I’m taking the provocative position (at least for this board) that everyone is blowing these compatibility and DRM issues a bit out of proportion. Specifically, in my response to Tim’s “DRM Train Wreck” post below, in which he bemoaned the lack of file compatibility in the digital music world, I argued:
“Could it not be the case that THE LACK OF compatibility between players and file formats actually encourages MORE innovation and competition in some ways? I fully know, for example, that it is impossible for me to play my Xbox games on my PlayStation console or a Nintendo console. Would we be better off if perfect compatibility existed among all the games and consoles? Would 3 major gaming platforms exist at all if we could simply play all game titles on just one of those boxes? I doubt it. I think it would be more likely that only one console would prevail and the other two would disappear. And I think that would leave us worse off as a result.
Same goes for music players, in my opinion. I fully know that I can’t play all my WMA files on an Apple Ipod. But that keeps me (and millions of others) buying non-Apple players. As a result, there’s a fairly diverse and growing market of Apple competitors. Would all those competitors be viable if we could all just play our digital music on an Ipod? Again, I wonder.”
Tim responded that he “[didn’t] understand why incompatibility would cause more competition.” And Steve, one of our most frequent and thoughtful commentators here on the TLF, responded that I am “overlooking a critical point concerning incompatibility” regarding “unintentional” vs. “intentional” variations thereof.
I was very sad to learn that Milton Friedman passed away today at the age of 94. Cato president Ed Crane has a great podcast celebrating Friedman’s life. I think he’s probably right that Friedman was the greatest champion of liberty in the 20th century.
He was probably the most important force behind the revolution in monetary policy that has banished stagflation to the history books. And he was instrumental in convincing the Nixon administration to end the draft.
But most important, from my perspective, is that he worked tirelessly at effectively communicating the ideas of liberty to non-academics. He had a column in Newsweek in the 1970s, created a PBS documentary on free markets in 1981, and produced several books on economics and political philosophy aimed at the educated lay reader. Here’s just one of the hundreds of interviews he gave promoting individual liberty during his long and prolific career:
Via Ed Felten, here’s a good write-up of the implications of the election for tech policy issues. For the most part, it looks like the change in leadership won’t have major effects on recent legislative fights. It looks like we can expect more government funding for basic research and more government regulation of private companies’ privacy practices. Apparently Democrats are more hostile than Republicans to allowing more high-skilled workers into the country.
There’s hope on copyright and e-voting reforms, but it looks like those will hinge on who gets key committee assignments and how much political capital they expend. Rep. Holt is the voice of reason on e-voting, and Reps. Boucher and Lofgren are supporters of DMCA reform. All are Democrats. But it remains to be seen if the new chair of the House Administration Committee, Juanita Millender-McDonald, will see Holt’s legislation as a priority. And as we’ve discussed before Boucher may or may not get to chair the IP subcommittee.
This is probably the most depressing part of the forecast:
Knowledge is a wonderful thing, and the more we can do to give people access to knowledge the better off the world will be. That’s always been the vision underlying Nicholas Negroponte’s bold “One Laptop Per Child” (OLPC) Initiative, which aims to put $100 laptops in the hands of people across the globe (especially in less-developed countries).
It’s a noble goal and one that’s almost impossible to argue with in theory. But, like everything else in this world that begins with good intentions, at some point you have to get around to dealing with basic economics, political realities and other technical issues. And those are the sort of growing pains that the OLPC project is experiencing right now. James Surowiecki brilliantly documents all this in an excellent article in this month’s MIT Technology Review entitled “Philanthropy’s New Prototype.”
Surowiecki provides a short history of other philanthropic endeavors from the past century, such as Andrew Carnegie’s remarkably successful campaign to bring public libraries to even the smallest American communities. He then compares Negroponte’s OLPC Initiative to those efforts. Surowiecki notes that OLPC is ambitious not only in its goal of putting a laptop into the hands of every child, but in the way it proposes to structure the program to make it happen.
The hosts seem surprised that you can’t email or download music from a server. And they’re not impressed with the “clunky” design of the Zune. “Why don’t they get some decent design people?” Miles O’Brien wonders.
From my perspective, though, the most interesting comment was when Andrew Ross Sorkin emphasizes that “If you have bought songs on iTunes, on Apple for example, it doesn’t play here. And even worse, if you bought songs on Napster or some of the former Microsoft-compliant devices, it also doesn’t work here. So you have to start your library all over again, unless you have it all on CD to begin with.”
This is absurd. We’re inching toward companies being able to prevent newspapers from publishing any sort of adverse information just all on vague copyright grounds. Facts are facts and people are entitled to circulate them.
Best Buy (ab)used the DMCA’s notice-and-takedown provisions to force the prices off the web. Alas, this is not the first time this sort of thing has happened. Four retailers pulled the same stunt back in 2002.
This is a serious problem with copyright law that doesn’t have a clear solution that I can see. It’s fairly common for a big company to send cease and desist letters to small companies or individuals alleging copyright infringement. Much of the time, the law is on the side of the little guy, but even hiring a lawyer to make the appropriate argument in court is far more expensive than complying with the letter’s demands. A good first step, though, would be to scale back the draconian statutory damages that now apply to copyright infringement. It might also be good to either have an expedited process to get frivolous copyright lawsuits dismissed or some kind of loser-pays provision for frivolous copyright lawsuits.
Although some people blame this sort of thing on the DMCA, it’s not clear to me that the DMCA is the culprit. The ultimate problem is the underlying copyright liability, which would exist with or without the DMCA’s notice-and-takedown provisions.
Gigi Sohn has a rebuttal to the Cary Sherman’s article on the Digital Freedom campaign, which I criticized earlier this week:
The collective amnesia the entertainment industry has about its past and recent attempts to limit consumers’ rights and technological innovation is nothing short of startling. Beginning with the piano roll at the start of the 20th century, continuing with radio, TV, the VCR, MP3 players and digital video recorders (remember Replay TV?), entertainment companies have tried either to legislate or litigate innovative new technologies out of existence.
Today in Congress, the recording industry is going after the digital audio devices, arguing restrictions are needed to prevent “theft.” But given that there’s no way to take music off of digital receivers, where’s the theft? It’s in the industry perception that if you can legally record music and can organize that music as you wish, then you won’t buy the CD.
As if their legislative campaign was not enough, the record companies are suing XM Radio because it permits consumers to easily record the music they pay for, and Hollywood is suing Cablevision because it provides a TiVo-like service in which the programs you choose to record reside on its servers. Even though the unanimous Supreme Court victory in the Grokster case gives the entertainment industry even more tools with which to fight real copyright infringement, it continues on a legislative and litigation strategy intended to limit lawful activities.
I think it’s important to keep in mind this history when debating present-day entertainment industry efforts to ban devices they perceive as piracy-promoting. They present their proposals as common-sense efforts to control piracy, but they said the same thing about their efforts to outlaw the VCR and the MP3 player. Their efforts to ban XM receivers with record functionality isn’t an anomoly–this is their knee-jerk reaction to every new media technology that comes along.
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology. Learn more about TLF →
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.