Digital rights management's hidden dangers

The content industry can learn a simple lesson from software publishers: Copy protection seldom, if ever, works.

As a growing population of users has mastered the electronic distribution of content, digital rights management (aka DRM) has become Ground Zero in heated debate over that content's proper care and handling.

Numerous systems, standards and technologies have been invented to prevent the illegal copying of digital material, and the debates they've sparked are as torrid as the subject is complex.

In the Napster-obsessed music business, where every music lover with a fast Internet connection is a potential pirate, content providers are scrambling to block illegal use of copyright-protected material.

There are many compelling reasons for protecting the rights of artists and their distributors. It's less clear, however, whether content providers busy with digital rights management have given sufficient consideration to possible side effects of these complex copy-protection schemes.

Customers come first
What's wrong with DRM? Quite simple: It is mainly concerned with the illegal use of material and cares little about the lawful customer.

If you've bought a book, a CD or a videotape, you expect to have the right to pass it on to a friend or a member of your family. Whether this other person does something illegal with it shouldn't be your problem, and it certainly should not limit your use of your rightfully acquired possession.

How would you like a book that you could only read in your house but not in the subway? How would drivers react if a law against speeding impeded their comfort when driving at authorized speed?

The first concern of any DRM solution should be to make sure that the intended user of the content doesn't experience any constraint on his legitimate use of the content he has acquired. Any system that doesn't offer the customer this basic consideration is doomed.

The song remains the same
One could counter that digital content is different, since it isn't bound to a physical carrier. That's true, but the distinction is trivial for most end users.

Does anybody in the content business really think Mr. or Ms. Consumer distinguishes between copying a CD to a cassette and burning a CD? Why should copying files to a MP3 player be different from making a special tape for your workout?

For content providers, the ultimate question is whether consumers will put up with such restrictions. Never mind the pirates; if legal users reject DRM, it could spell trouble for content providers and technology suppliers alike.

The content industry can learn a simple lesson gleaned the hard way by software publishers: Copy protection is not accepted by the market. No mass-market software publisher in his right mind would bring out copy-protected software nowadays; users hate it, and it doesn't really stop hackers from pirating the programs anyway.

The only cases where (hardware) copy protection is grudgingly accepted by users are vertical-market solutions for professionals, such as high-end 3D rendering packages.

Isn't it ironic that the same Microsoft that is now defending stringent DRM schemes for e-books doesn't use copy protection on its software products? Why? Because the company would sell less copies and would be more vulnerable to competition.

Consider the experience of Quark Inc., which launched XPress in 1987 with a key-disk copy-protection scheme. Despite strong interest in the product, the market reaction was so bad that the company had to release unprotected software a few months later.

If users don't accept copy protection on a professional program, why would they do so on for something priced at a few dollars?

Risky business
The real concern, of course, is the dent excessive DRM schemes can put into emerging markets and technologies. Take e-books, for example, a market that's still dormant at best; it could virtually be stifled if publishers ignore the comfort of the customer.

One might even argue that e-books need pirate copying to get the message out. I've seen marketing managers in software companies who view limited pirate copying basically as viral marketing. When you're trying to sell something target customers aren't used to buying, you have to convince them that they actually want your product.

The emerging market for MP3 faces a similar challenge: While it's a big hit with Internet-savvy teenagers, MP3 has yet to become a mainstream technology in the consumer market.

Content providers need to be very careful about how they implement DRM schemes for music files; if, for Instance, it's suddenly impossible to copy a track from a CD to your MP3 player, it would suddenly render the device much less attractive.

If you are a content provider, don't take these matters lightly: You stand to lose much more than you would from pirate copies. Whatever you do, think about the consumer first. The customer expects to be king--even in a digital world.

Andreas Pfeiffer is an industry analyst and editor in chief of the Pfeiffer Report on Emerging Trends and Technologies. As a growing population of users has mastered the electronic distribution of content, digital rights management (aka DRM) has become Ground Zero in heated debate over that content's proper care and handling.

Numerous systems, standards and technologies have been invented to prevent the illegal copying of digital material, and the debates they've sparked are as torrid as the subject is complex.

In the Napster-obsessed music business, where every music lover with a fast Internet connection is a potential pirate, content providers are scrambling to block illegal use of copyright-protected material.

There are many compelling reasons for protecting the rights of artists and their distributors. It's less clear, however, whether content providers busy with digital rights management have given sufficient consideration to possible side effects of these complex copy-protection schemes.

Customers come first
What's wrong with DRM? Quite simple: It is mainly concerned with the illegal use of material and cares little about the lawful customer.

If you've bought a book, a CD or a videotape, you expect to have the right to pass it on to a friend or a member of your family. Whether this other person does something illegal with it shouldn't be your problem, and it certainly should not limit your use of your rightfully acquired possession.

How would you like a book that you could only read in your house but not in the subway? How would drivers react if a law against speeding impeded their comfort when driving at authorized speed?

The first concern of any DRM solution should be to make sure that the intended user of the content doesn't experience any constraint on his legitimate use of the content he has acquired. Any system that doesn't offer the customer this basic consideration is doomed.

The song remains the same
One could counter that digital content is different, since it isn't bound to a physical carrier. That's true, but the distinction is trivial for most end users.

Does anybody in the content business really think Mr. or Ms. Consumer distinguishes between copying a CD to a cassette and burning a CD? Why should copying files to a MP3 player be different from making a special tape for your workout?

For content providers, the ultimate question is whether consumers will put up with such restrictions. Never mind the pirates; if legal users reject DRM, it could spell trouble for content providers and technology suppliers alike.

The content industry can learn a simple lesson gleaned the hard way by software publishers: Copy protection is not accepted by the market. No mass-market software publisher in his right mind would bring out copy-protected software nowadays; users hate it, and it doesn't really stop hackers from pirating the programs anyway.

The only cases where (hardware) copy protection is grudgingly accepted by users are vertical-market solutions for professionals, such as high-end 3D rendering packages.

Isn't it ironic that the same Microsoft that is now defending stringent DRM schemes for e-books doesn't use copy protection on its software products? Why? Because the company would sell less copies and would be more vulnerable to competition.

Consider the experience of Quark Inc., which launched XPress in 1987 with a key-disk copy-protection scheme. Despite strong interest in the product, the market reaction was so bad that the company had to release unprotected software a few months later.

If users don't accept copy protection on a professional program, why would they do so on for something priced at a few dollars?

Risky business
The real concern, of course, is the dent excessive DRM schemes can put into emerging markets and technologies. Take e-books, for example, a market that's still dormant at best; it could virtually be stifled if publishers ignore the comfort of the customer.

One might even argue that e-books need pirate copying to get the message out. I've seen marketing managers in software companies who view limited pirate copying basically as viral marketing. When you're trying to sell something target customers aren't used to buying, you have to convince them that they actually want your product.

The emerging market for MP3 faces a similar challenge: While it's a big hit with Internet-savvy teenagers, MP3 has yet to become a mainstream technology in the consumer market.

Content providers need to be very careful about how they implement DRM schemes for music files; if, for Instance, it's suddenly impossible to copy a track from a CD to your MP3 player, it would suddenly render the device much less attractive.

If you are a content provider, don't take these matters lightly: You stand to lose much more than you would from pirate copies. Whatever you do, think about the consumer first. The customer expects to be king--even in a digital world.

Andreas Pfeiffer is an industry analyst and editor in chief of the Pfeiffer Report on Emerging Trends and Technologies.