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Welcome to Orcmid's Lair, the playground for family connections, pastimes, and scholarly vocation -- the collected professional and recreational work of Dennis E. Hamilton

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DRM as Destroyer of Markets
 
Must DRM Go Away?

2006-04-02

Happy Birthday, Ted


Ted Leung, photographer, at Northern Voice 2006 Moose Camp: February 10, 2006

{tags: NorthernVoice Moose Camp photographer blogger Ted Leung orcmid}

One of the gifts of this year’s Northern Voice conference was seeing Ted Leung, Julie, and the kids again.  A bonus was listening to Ted express his passion for photography and his pleasure in searching out absorbing great photography books. 

Thanks Ted, and Happy Birthday. 

May the coming year find your passions undiminished and created new every day.

 
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We have a great future behind us

Susan Crawford blog :: A gentle decline.  I just learned from David Weinberger that Susan Crawford is someone to pay attention to.  I’d so say.  Her blog is a delight to read.  Even in a bleak moment, there’s an intense power of words:

“ … We have a great future behind us. 

“PhD candidates from other countries are finding it so difficult to be admitted to the country that they're staying home.  Public education is in crisis.  We don't have a replacement for Bell Labs, we don't know how basic research is going to be funded, and we label outsourcing to other countries as un-American, even though people in those other places speak English better than we do and work harder.”

“It's hard to see this crisis; it's made up of a million incremental steps.  But it's happening.  The terrible state of broadband penetration in this country is just a visible symptom.  The solution isn't going to be found in short-term market players who have every reason to act monopolistically (and uniformly bad track records).  The people who lead us need to recognize that this country is steadily declining, and that pride in our former accomplishments won't save us.  We need vision, and we need it now.”

I think this observation is about far more than the state of broad-band infrastructure.  It seems to be a question of national malaise, one that is not uniformly shared.  I also wonder whether John Cooper’s thoughtful comment isn’t the most challenging of all, reminding us that we get the leaders (and the government) we deserve.  So, as followers, what action is available for us to restore our sense of flourishing vitality and promise, one that joins us with the diverse aspirations of ordinary people everywhere? 

I am left to ask: What am I doing, today, to create the world I want to live in?

{tags: civil participation democracy social responsibility us-them governance public interest Susan Crawford orcmid}

 
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DRM as Destroyer of Markets

Orcmid's Lair: Must DRM Go Away?  In digesting James Delong’s March 22 FOSS & the Content Industry post, I was taken aback by the idea that banning DRM (which I am not advocating) would abolish markets.  What struck me is that DRM is itself destructive of established and thriving markets, and that should be taken into account.  In addition, there are many ways that DRM is an inadequate substitute.

{tags: intellectual property economics markets fixed assets rented experiences DRM James DeLong orcmid}

 It seems to me that those who require DRM to preserve their business models are looking at a different and more-exclusive market economy than the one they are closing off.  I am thinking of the current market in recorded media, including printed works.

Banning Consumers from the Market

In today’s publishing market system, books are fixed assets and anyone can conduct trade in books. There is a market that extends beyond the first sale, and that is part of the economy around published works.  I think that, with eBay and amazon.com, and brokering of referrals to alternative sellers, this market is thriving in ways that we had not observed before.  And books are assets: you must depreciate them under certain conditions, loss and destruction of books can be a casualty loss, you can have insurance protection against loss of books as household and professional goods, you can bequeath them to your heirs, donate them to charities (including public-library donations), free them to Book Crossing, and so on.

Of course, first sellers don’t seem very fond of this arrangement.  I know there are writers (who tend to be voracious readers and I bet have library cards) who are unhappy about used sales of their books.  No one on the publishing end seems to be all that happy about lending libraries.  On the other hand, in what markets is the first seller able to tax future trading in their commodity?

It seems important to appreciate that current DRM models remove the consumer as a full market participant. I find that lack of freedom from participation to be seriously disruptive.

I don't mind going to the movies and paying for the one-time experience. There are not that many films I need to see more than once.  I certainly don’t object to live performances being one-only experiences.  And also find that when I own DVDs I don't watch them (the big exception for me being performance/concert films and videos). But I can trade those in, swap them with others, and not be violating any IP regime. Likewise with my CDs and LP records. Not with my licensed audio, although if you figure out the pricing, it isn't that much cheaper (although the short-term convenience is certainly a factor).

The Inevitable Destruction of DRM’d Works

Without stepping into the "this software is licensed not sold" quagmire (but it is not leased/rented like DRM’d works, it is licensed, and licenses may even be transferable), I can understand one fear of DRM that has nothing to do with free-riding. DRM is too temporary and fragile. It seems to be making a consumable out of what previously was a durable commodity (maybe not what an economist would call it, but that is what comes to mind).

So, regardless of the parasitism issues, there is a genuine concern that the material will be lost and unusable (along with a fear that this can arise as a malicious act of the producer).   In contrast, I still have my dad's 78 rpm low-fidelity platters. There are not in good shape, but I can preserve them for private purposes as well as I'm able.  I can even do that digitally and no longer need to hold onto a proper turntable for playing them.

I have eBooks that I purchased that I lost when the computer that carried them cratered. Now it is easy to say that is simply an ordinary loss, except it happens too predictably.  When did your stereo crapping out ever destroy your record or CD collection along with it?  (I understand there are ways to recover eBooks, depending on their source, but I have no idea how to do that and I thought that eBooks were dead, making it a big surprise to find a Microsoft Reader among the pre-installed junk on Quadro, my new Toshiba Satellite Tablet PC.)

It seems that loss of DRM’d digital material is enevitable. With the Microsoft Media Player DRM for my MSN Music/Radio-Plus song purchases, I know I can move the material to other media and I can arranged to play it on a different computer. But I'm already up to 3 installs of some older materials that have been moved from dying computers to healthy ones. When I hit the magical 5-times limit I don't know what recourse there will be to losing the material completely. This condition is a lot shakier than collections of CDs and my discarding a CD because I have lost interest and I want the shelf space back.

The Deep Preservation Requirements of Scholarship and Civil Culture

Of greater concern to me is the impact of DRM’d works on scholarship.  It is a big deal that sources be cited in scholarly work, and those sources must be accessible for others to review, confirm, reject, and dispute.  Sources may provide new inspiration to a later arrival.  Sources may be seen as misinterpreted in later work.  In serious scholarship, sources matter.  This is so important that, when I was working on an M.Sc dissertation project, I was reminded along with all other students that it is expected that we retain copies of those portions of sources that were relied upon in my own work.  Nothing is to be done with them, but they must be available as evidence of the work that was done and how portions of the original source were relied upon.  These records may well survive the future inaccessibility of a primary source.

This particular case struck me as I visited one of the research libraries on the University of Washington main Seattle campus this past week. I had the good fortune of finding a book, published in 1959, that I no longer own (Handbook of Automation, Computation, and Control, volume 2) and that I had always meant to review in light of recent explanations for how computing works and for perspective on how much that concerns us now were anticipated at the beginning of the digital-computer era.  There was an intact copy in the library storage and it was quickly brought to me.  I was able to review the chapter of importance to me and return the book to be replaced until someone else wanders across it.  I will consult my pages of notes and refer to that book in articles I am working on.  On my next visit I will see if I can check on a portion of the first computer book I ever owned, Dan MacCracken’s 1957 Digital Computer Programming.)

A Call for Creative Tension

So, more creative thinking is needed. I can't trade or protect my DRM'd material without the cooperation of a third party and yet the DRM is important to prevent me from pirating the DRM'd work, or at least to assure the publisher that piracy is not a significant source of loss.  I don’t see the producers of DRM’d works as reliable preservers of my rights and titles (were I offered any at all).  I agree with James DeLong that the government is probably not a good choice, although some government chartering of some efficient mechanisms would be interesting.

In my musings, I wonder if there is a way to allow transfer of fixations of digital works that preserves DRM and that empowers scholarship, our great libraries and collections, and safeguards the work for those uses that are intended to always be fairly available for all people, now and into the future, long after exclusive property rights have extinguished.

What I see is that we are so quick to predict unexperienced extreme consequences and make such cynical attributions to the other parties that we see neither common ground nor our mutual interdependence.  Somehow, we must recognize the legitimate concerns of all parties.  Whether we can overcome our snap-judged fear of being exploited or taken advantage of in some other way will be a major factor in our ability to find an efficient and promising solution.

As far as markets go, we have ample evidence that markets ultimately work around artificial barriers and disequilibria.  Just as nature finds a way, so do economic actors.  What all of the current actors need to remember is that a transaction only works when both parties gain more than they give up.  When that fails, substitutions are found, no matter how long it might take.

 

 

 
Comments:
 
it should be noted that the claimed reason for DRM is "to prevent piracy". there has never been and probably never will be a DRM scheme that achieves this goal.

the only thing DRM does now is prevent exercise of fair use rights and lock-in for the vendor. and, of course, all those other things you mentioned, especially the preservation aspect.

DRM is a way for the content industry to exercise more and more control over their products, to the detriment of consumers and society.
 
 
I think it is important to understand that DRM does two things: It mitigates against casual infringement that can be widespread and it demonstrates guilty knowledge on the part of pirates and others who work to overcome the DRM. It is difficult to claim innocent infringement when overt actions are taken to overcome the DRM.

Finally, it is important to recognize that there is, in law, no such thing as fair-use rights. This is a framing of debate around a nonexistent legal doctrine. The statutory fair-use claim is not a right, but a defense, and only a court will determine the existence of fair use on an individual basis. The law (in the United States) says what a judge should consider. It draws no line. So there is infringement first, then a defense that a court may accept or not.

Having said all of that, I do agree that DRM is indeed a way to create a technological enforcement of a limited license, a kind of contractual technology. It, and escalating low-grade piracy are examples of degrading social trust. It will be interesting to see how markets work around this.
 
 
As long as I'm commenting on myself, I want to add one additional, and important area where DRM destroys an existing market: making gifts of recorded media (books, audio recordings, videos, etc.). Giving the gift of music is a bit awkward under DRM regimes. DRM alters the experience ... and the romance.
 
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