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Here we'll explore the nexus of legal rulings, Capitol Hill policy-making, technical standards development, and technological innovation that creates -- and will recreate -- the networked world as we know it. Among the topics we'll touch on: intellectual property conflicts, technical architecture and innovation, the evolution of copyright, private vs. public interests in Net policy-making, lobbying and the law, and more.

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May 7, 2004

Why Use DRM If It Doesn't Work?

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Posted by Ernest Miller

In the ongoing debate about cynicism and the broadcast flag, see here (More on Cynicism, Indecency, the FCC and the Broadcast Flag), Freedom To Tinker (Dare to be Naive), and Furdlog (Cynical or Naive?), one point has come up that I think deserves a more indepth answer. If, as I argue, the broadcast flag doesn't inhibit widespread internet distribution of HDTV broadcasts, why are the broadcasters pushing so hard for it?

In the comments on the Freedom to Tinker posting (Dare to be Naive: Comments), frequent IP blog poster Cypherpunk asks:

What, then, is the motivation for the movie companies? Why are they expending their political capital on a measure which would not benefit them? If they don't think the BF is going to reduce the quantity or quality of piracy, then I don't see why they would be pushing it so hard.

A similar question was raised yesterday on Sellout Central. Brad, of Brad Sucks fame, considers why some might want to use DRM even if they know it will be cracked (The point of DRM). His thoughts come in response to a claim on The Register that all current-generation DRM will be cracked (DRM 'will be cracked' says iTunes hacker).

These are pretty good questions. I don't believe that DRM can be successful in keeping widely distributed content off the filesharing networks. If I'm right, and content owners aren't simply dumb (they're not, or at least not entirely), then why do content owners continue to push DRM? Take Apple's iTunes ... please (ba-dump-bump). Everybody knows that every single song on iTunes is available for free via P2P. Every single one. Why then have DRM at all? It certainly isn't adding value. There has to be a good reason ... and there is. Read on for my answer ...

The straightforward answer is that DRM provides the content industries benefits that are unrelated to or only loosely related to stopping content from getting onto filesharing networks.

DRM works, just not for piracy protection. However, claiming you need DRM for piracy protection seems plausible on its face. If you haven't really thought about the issue it makes a good public justification for insisting on government support of DRM ("Gotta have it to stop them no good rotten pirates!"). But what are some of the real reasons one would support DRM if it doesn't stop internet piracy or even slow it down significantly?

DRM Doesn't Work ... Today

It is clear that DRM doesn't work today, but that doesn't mean that DRM won't work in the future ... at least that is what Hollywood is hoping. The content companies still believe that a legislative/technological solution can be found that will make DRM work as an anti-piracy device and many tech companies are encouraging them in this belief. Between trusted computing, broadcast flag treaties, Super-DMCA laws, and other efforts along these lines, the content companies are really counting on DRM actually doing what is claimed sometime in the next few years.

Until Hollywood enters the content lockdown nirvana, they will continue to use DRM that they know doesn't work for a number of reasons:


  • The very fact that DRM doesn't work is a justification for Hollywood's legislative agenda. "We need more laws because technology alone won't solve the problem."
  • Once you start selling content without DRM it will be hard to go back - how will you justify it? The broadcast flag permits consumer copying (for home use only), not because Hollywood wants to permit it, but because it would be too difficult to fight entrenched consumer expectations. Better not to let expectations get entrenched in the first place.
  • Selling content with DRM (even if the DRM is broken) means you aren't really selling anything at all, you are licensing it. A person doesn't "own" the music they "buy" from iTunes, what Apple calls "the product" is licensed to the purchaser, but that license may be changed at any time in the future. This means that when effective DRM is available the content companies can force those with the old, ineffective DRM to upgrade. This is an even more prominent issue with, for example, Microsoft's Janus, which can be set to terminate access to content after a set period of time. They say Janus will let people "rent" content, but the truth is Janus does nothing but let people "rent" content. Bonus: You still get to reserve all your copyrights. Copyright and contract, what's not to like for a content owner?
  • In the case of the broadcast flag, you set a precedent for controlling technology that has otherwise been uncontrolled. Furthermore, bureaucracies tend towards increasing control over time. The longer the broadcast flag exists, the more likely that the DRM restrictions will gradually increase.

How much would you pay for DRM now? Don't answer yet, there's more!

It's All About the Control

What happens when you let people have content without DRM controls? Even if people don't violate copyright, you lose control over the content. People can do all sorts of things, like exercise fair use, and other people will build them the tools to do those things with no input from Hollywood.

As awful and overextended our current copyright regime is, it still permits people to do things that the content industry doesn't like, which is pretty much anything that doesn't involve forking over more cash to Hollywood.

For example, copyright doesn't support region coding (tagging DVDs so that they only play in certain countries). Traditionally, if you bought a book in the UK, you could read it in the US and there was nothing the copyright industry could do about it. Today, if you buy a DVD in the UK (even if you've got the whole PAL/SECAM thing straight) you will likely not be able to play it on your US DVD player, thanks to DRM.

Want to skip those FBI warnings at the start of your DVD? Forget about it with DRM. This may not sound like a big deal, but the DRM to enforce this capability prevents a lot of other cool things from being done, such as automatic synching of alternative commentaries to a DVD. Furthermore, if forcing people to watch the FBI warning is not big deal, why is so much technology required to enforce it?

Content owners don't like fair use. If they could, they would ban every bad review, critical comment or parody. Soon-to-retire MPAA president Jack Valenti has been wont to say "What is fair use? Fair use is not a law. There's nothing in law." DRM is great at inhibiting fair use.

In combination with the DMCA, DRM becomes a devastating legal weapon, even if it is a pathetic technological one. Note that copyright infringement is already illegal (with potentially enormous liability attached) but the DMCA allows people to be punished for doing things that are perfectly legal under copyright law. For example, not only is one subject to civil liability for distributing an unauthorized DVD player, one is subject to liability for merely playing a lawfully purchased DVD on an unauthorized DVD player. Nice to have that threat hanging over people's heads, isn't it?

Of course, the DMCA threat isn't aimed so much at consumers (though they are definitely in the crosshairs) as it is aimed at consumer electronics and software companies, which is the final point of this section.

What happens if the content industries start selling content in an unencumbered format? Well, technology companies are going to start developing products that use that content in new and innovative ways. Some of these ways may very well undermine the existing business models of the content industries. Without DRM the content industry would have very few levers with which to influence the consumer electonics and software companies. The content industry could still sue to prevent the development of certain technologies under theories of contributory or vicarious copyright infringement, but such lawsuits are a crude tool of influence at best. Furthermore, thanks to Sony v. Universal, many disruptive technologies will be legal *cough*DiamondRio*cough*.

However, by insisting on proprietary DRM (well, under the DMCA it might not have to be proprietary), the content industries are in a much better position in negotiating how technology will be permitted to develop. If the content industry thinks that a particular new device is too disruptive, they can lock it out of using their DRM'd content legally, something that copyright law would otherwise not allow. If CD's had DRM and the DMCA had already been passed, there never would have been a Diamond Rio portable MP3 player.

Conclusion

Of course DRM is valuable to the content industries. It just isn't valuable in the fight against widespread internet filesharing.

Comments (8) + TrackBacks (0) | Category: Big Thoughts


COMMENTS

1. patentbuster@msn.com on May 7, 2004 8:48 AM writes...

Once one has a DMCA mandate and a broadcast flag mandate, widespread vertical controls over hardware (and horizontal agreements among competitors) are now all but "blessed" by the FCC and Congress, and what would otherwise be anti-competitive now is protecting legitimate copyright interests.

Its using copyright law to nullify antitrust law. Microsoft tried to do it in the DC circuit and failed, but with the DMCA and the broadcast flag, competition will soon be all but dead in the American technology sector.

The biggest impact will be a dramatic increase in the trend of novel technologies and innovation (both hardware and software) moving offshore to avoid the overregulated environment of the united states.

Permalink to Comment

2. Allen on May 7, 2004 1:28 PM writes...


If consumers simply chose alternative music and did not copy existing content, there would not be a need for DRM. Arguably, the failure of consumers to honour this contract is why the arms race has escalated. At the end of the day, DRM is only there if people choose to use it, and there are a lot of viable alternatives.

In the same manner, proprietary technologies only exist because people choose to buy such technologies, whereas people can choose to support open and interoperable standards as an alternative.

Why fight DRM: simply support and run with a better alternative.

Permalink to Comment

3. Dean on May 7, 2004 1:40 PM writes...

Ernest,

Using the term 'Digital Rights Management', plays into the goals of the IP industry. It makes it sound legitimate. What needs to be done is to popularize a term that describes what it really is - 'Digital Restrictions Management'. Same acronym, DRM, but much less palatable to consumers.

Permalink to Comment

4. Jake Ludington on May 8, 2004 3:00 AM writes...

First, call DRM what it really is, DISTRIBUTION Rights Managment. DRM tells us where a series of bits can or cannot be used. Region coding is a form of distribution rights managment, so is determining which types of devices and how many. Digital rights implies the encryption only impacts 1s and 0s. In theory, future versions of rights could function at the device driver level, preventing the loopback of audio from the speaker out to the line in, effectively killing the one loophole that exists in every computer with a sound card.

Second, as long as consumers are willing to buy what Hollywood is selling, DRM in any form will work. Sure, the same bits are available for free via P2P. DRM will take off as soon as it becomes easier for the average joe to get a protected file than it is for them to access the free stuff. If studios can create an environment where the protected content can be downloaded N-times faster than the free stuff, the majority will pay a few bucks for the instant gratification, no matter how limited it is. The lazy solution always wins. For the free market to win, more DRM-enabled sites need to work like Buy.com, where the user is required to individually authenticate each song purchased.

Permalink to Comment

5. Ernest Miller on May 8, 2004 10:33 AM writes...

Hey, I'm the guy who is supposed to say "it's all about the distribution." Only in this case it isn't.

I agree that DRM is not really the best name for the technologies that we are using, but it is the one most people use and it gets across what you are trying to talk about to others, so it is fairly useful that way. Also, note that I didn't explain what the acronym stood for - use an acronym long enough and you don't really see it as anything but a collection of letters and forget what it stood for. You know what the acronym "means" but you aren't focused on what it stands for.

As far as distribution goes, DRM tells us more about "how" bits may be used than "where" bits can be used. Region coding deals with distribution, sure, but it is based on an underlying technology that also permits you to force people to watch the FBI warnings or advertisements. That doesn't really seem like distribution to me. DRM does effect distribution, but that is not all that it is about ... it is about control of the user's experience in many, many ways. So, although I am a big fan of the distribution way of thought ... I wouldn't emphasize it here.

Your convenience argument is true as it goes, but just think. If you got rid of DRM, then legal downloading would be more attractive, thus lowering the tipping point at which illegal is more convenient than legal.

Permalink to Comment

6. charlie on May 8, 2004 5:53 PM writes...

I don't know if anyone will agree with me, but DRM can achieve quite a bit by merely working symbolically.

Permalink to Comment

7. Nicholas on May 10, 2004 3:45 AM writes...

Thanks for the very clear analysis of why DRM.
Following the discussion here, I am a big fan of making the distinction between 'rights management' and 'copy management' . In my view:

In the analogue world 'Rights Management' consisted of making the content with a © (copyright notice), maybe registering it with the copyright office, and maybe the rights holder keeping some records of who he or she has transferred rights to or who contributed to the copyrighted work.

In the analogue world 'Copy Management' was a natural inefficiency in the system (it was usually difficult or expensive to make copies) backed-up by legal penalties for those that blatantly abused the system.

DRM, in the digital world, arbitrarily combines Rights and Copy Management and puts the control of both into the hands of one authority, usually the rights holder, with a resulting imbalance in the system for society as a whole. At www.commonrights.com I propose a rights based system with no copy controls.

Permalink to Comment

8. Dan Ced on July 18, 2004 7:14 PM writes...

Here is some more interresting thoughts about the DRM problem by David Weinberger at this site:

http://www.wired.com/wired/archive/11.06/view.html?pg=1


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