The article suggests that the strategy of talking to law professors, as opposed to tech experts (or, possibly, average students) will not result in anything useful:

“I don’t understand why, if they truly wanted to engage consumers, they would approach law professors, especially those at the most elite schools,” Mr. Goldman wrote in an e-mail interview. “There are at least a half-dozen ways that Paramount could get better marketplace feedback than eliciting the perspectives of law students, which reinforces why I think they intended to do more talking than listening.”

The strategy suggests to me that Paramount seeks to find new ways to bend the law to their favor: Publishers as well as movie studios have all taken to similar reactions to the public’s fervent resistance against any laws that would control or restrict the presentation or use of media, citing even the slightest new law or regulation as a violation of fair use and basic freedoms; the media moguls, having decided the public is unrealistic and unreasonable in their demands, have turned unilaterally to the government to protect their property.

However, government laws have proven so far ineffective in exerting any real control or providing protection against media piracy, prompting the moguls to seek new and inventive ideas that will work within the system… therefore, the consulting with the fresh young minds of future lawmakers and their teachers.

It’s truly a shame that both sides of the media consumption market continue to fight each other, instead of working together to find a mutually-equitable “trust, with verification” position that will eventually result in a marketplace that makes sense… hopefully, before the Sun goes nova or the Moon falls out of orbit, rendering the issue moot.

Wilkert suggests that EPUB could be a solution to this if Amazon could be convinced to adopt it and drop DRM. (Well, of course it could. Heck, pretty much any e-book format would work if Amazon dropped DRM, thanks to Calibre.) He reiterates the usual music-industry-based arguments for ditching DRM.

Several years ago Steve Jobs posted a letter to the music industry pleading for DRM to be abandoned. My favorite part of that letter is where Jobs asked why the music industry would allow DRM to go away. The answer: "DRMs haven’t worked, and may never work, to halt music piracy." In fact, a study last year by Rice University and Duke University contends that removing DRM can actually decrease piracy.

Publishing-industry observers and consultants have certainly ramped up the anti-DRM rhetoric in the last few weeks, haven’t they? I wonder if there’s some particular reason for that. The Kindle Fire securing Amazon’s lead in the e-book market bringing on a fresh wave of lock-in panic?

I also wonder whether anything will come of it. Are publishers taking heed and even now holding secret discussions on whether to follow the music industry’s lead? I suppose we can hope, at least.

The suggestions include things like built-in deterrents, waiting to release games until more bugs had been worked out, giving paying customers extra content, and engaging with the community. Some of these solutions are more popular than others, of course. When you provide extra perks to people who bought new, it can come off as taking them away from people who buy used.

And in the end, the article suggests, it may not matter just what non-DRM measures (or even DRM measures) you take to reduce piracy—plenty of people will still pirate anyway. Sadly, this is the truth—even publishers who bend over backward to make their games more attractive to pay for than pirate find people will still happily rip them off.

For example, the games in the first Humble Indie Bundle could be purchased DRM-free for as little as a single penny for all of them—but a developer still estimated that as many as 25% of the games downloaded from their site were snagged via reshared links with no payment at all—and that’s not counting possible peer-to-peer or cyberlocker retransmission.

(Though oddly the same thing doesn’t seem to be true for DRM-free e-books; Baen’s DRM-free offerings are much less pirated than offerings from other publishers. Perhaps e-book readers are more loyal and principled than video gamers?)

And when that happens, developers don’t really have much recourse. As CD Projekt found, suing (alleged) pirates is a great way for game studios to tick off their customers even worse than DRM does.

The article closes:

If there’s a final, definitive solution to online piracy that doesn’t in some way involve Digital Rights Management, it has yet to be found. We can only hope that when such a solution is implemented, it’s one that’s as just to a product’s paying end users as it is to the companies that designed it.

But unfortunately, as crackable as most DRM is, DRM isn’t much of a “final, definitive solution” either. Some level piracy may just be a fact of life.

Shatzkin notes three interesting statistics that came up in All Romance’s presentation at DBW:

• Only 20% of All Romance’s readers strongly resist e-books with DRM.
• 96% of All Romance’s e-book sales by volume are DRM-free.
• 91% of All Romance’s titles are protected by DRM.

He points out:

What this means is that the nine percent of All Romance’s offerings that do not have DRM are selling 96% of their units overall. And since only 20% of their customers find DRM as a strong deterrent to sales, that means those fledglings are outselling all the majors for other reasons.

What might those reasons be? Shatzkin speculates, but doesn’t really come up with any solid reasons. My own speculation is to wonder whether even those people who don’t “resist” DRM could nonetheless be swayed toward embracing DRM-free because they recognize the advantages it has. I know I don’t “resist” e-books from Amazon or Barnes & Noble if they’re not available anywhere else, but I’m more inclined to buy something if I see it’s DRM-free.

But the more interesting thing to me is how much this and other news coming out of DBW suggests that DRM is being discussed at industry events a lot, rather than just being taken for granted as “that thing we don’t publish e-books without.” Might this suggest e-book DRM could be on the beginning of its way out? It still seems a bit unlikely—but then, so did the music industry ditching DRM before it did. How much bigger will Amazon have to get before publishers decide the paper(less) tiger of e-piracy is the secondary threat?

Berlucchi points to the example of the major music publishers dropping DRM on electronic music sales in 2007 to reduce the amount of power Apple had over music customers. He suggests watermarking as an alternative, bringing up the example of German e-publisher Libreka who found that none of its watermarked e-books ended up on piracy sites, unlike DRMed or photocopied books.

As much as publishers are complaining about the power wielded by Amazon, and watching the company increase its hold over consumers with bold initiatives like the Kindle Lending Library and free streaming movies with Amazon Prime, it seems like they ought to look at dropping DRM as an opportunity to break Amazon’s stranglehold. Given how widely pirated books and e-books are already, it’s not as if they have anything to lose.

And it seems like it’s just about time for them to consider it. Berlucchi points out:

It took 5 years from the release of the iPod for music publishers to drop DRM. The Kindle was launched on November 19, 2007, 4 years and  2 months ago…

The clock is ticking…

Berlucchi calls attention to the actions of the music industry in recent years, eliminating DRM and permitting ownership of music—you can now even import songs bought on one platform into a competitor’s via cloud services. He proposes fighting piracy through education and legal action, and adopting “Digital Rights Morality” instead of Digital Rights Management: leave off DRM in the cloud, watermark downloadable e-books visibly and invisibly, and just use DRM for library e-books or in selected cases.

As with the music industry, Berlucchi states, this would prevent silos and monopolies, offer more value to end users, and increase competition by allowing anyone to sell e-books for any platform.

Although Berlucchi states early in his presentation that these views are his own, not those of Anobii, publishing pundit (and DBW chairman) Mike Shatzkin nonetheless called the argument “significant” because Anobii is part-owned by the UK divisions of major publishers HarperCollins, Penguin, and Random House.

Going DRM-free has certainly worked for Baen, which includes instructions on its e-book site for how to load its books into several major e-reader platforms. And it has worked for the music industry. It would be nice if publishers would see how well it worked for them, too.

(Found via The Bookseller.)

For one thing, he points out that MP3s aren’t actually used all that much in digital music sales. Apple uses AAC, which has generally better sound quality. The only major commercial market for MP3s is Amazon, and it only has 10% of the music market.

And whereas MP3 had a number of advantages over the competing CD format (in particular, it was much smaller and easier to transfer digitally), EPUB doesn’t offer any really compelling advantages over other e-book formats.

He also points out something interesting about DRM and consumer lock-in.

The obvious feature that gets blamed for lock-in is DRM, but it’s not the only way.  One of the reasons why Apple dropped DRM for music (though not the only one) is because it no longer needed DRM for lock-in; it could resort to more subtle means, such as the hassle of taking iTunes tracks and moving them to, say, your Android phone; or certain tricks Apple plays with its codecs to make them not play well with others.

Rosenblatt suggests that if Amazon succeeds in dominating the e-book market, it might very well drop DRM if it knows it no longer needs it to keep people locked into its MOBI-specific reader platform. After all, there aren’t many competitors they could move the books to if they had them.(Publishers would insist that it keep DRM on textbooks, he says, because students don’t buy them willingly. I wonder why he thinks that publishers of other books wouldn’t insist on it?)

He sees a more competitive market as leading to more DRM, as both Amazon and its successful competitors resort to DRM to keep customers from being able to jump ship, since there would in this case be a competitor for them to jump ship to.

The point is that in none of these scenarios do we get all three attributes: ease of use, interoperability, and choice – the way we do with print books.  Technology markets like this do not exist. They are mirages. Just like the commercial market for MP3s.

I’m not sure I buy Amazon being able to talk publishers into ditching DRM in any event, but it is at least an interesting theory.

Well, his sales rate has slowed a little, but he’s still surpassed $1 million in total sales in just twelve days, and has a PayPal screenshot to prove it. (Personally, I’d be really reluctant to leave a million dollars in their hands for any longer than I had to.) He’s going to use $250,000 to pay off production costs on the video, split $250,000 into bonuses for his staff, give $280,000 away to a number of charities, and keep $220,000 for himself.

Louis seems to have a pretty good attitude about money:

I never viewed money as being "my money" I always saw it as "The money" It’s a resource. if it pools up around me then it needs to be flushed back out into the system.

If he makes another million, he’s promised to give more of it away.

Anyway, right on Louis! I hope any of his future efforts in this regard are just as successful, and not just because it’s great to see someone else showing it’s possible to make a go of eschewing DRM and trusting his customers.

(Found via Techdirt.)

As Laura Hazard Owen notes at PaidContent, one of the questions asks what could keep fans from buying the Potter books, and one of the choices is not having a credit or debit card. This suggests that Pottermore may come up with a way of letting parents add money to children’s accounts so they can buy the books they want.

But I was more interested by another choice on that question, “Likely to be too expensive for me.” As far as I know, no pricing information on those e-books has come out yet. I wonder what information fans would be going by in deciding whether it was going to be too expensive or not? And by suggesting that fans might think it’s “likely”, does that mean the price is going to be what some would consider too high?

Given the widespread availability of pirated versions of the e-books, I would hope that Rowling is putting a lot of thought into what price level she is going to set. If it’s too high for her readers, especially those readers who are children and don’t have large allowances, they’re probably going to turn to those illicit copies instead. Of course, Rowling is already doing the right thing by eschewing DRM, so perhaps we should have confidence the books will be priced right as well.

At any rate, if you’re a Potter fan, be sure and take the survey at the above link. The more information Pottermore has, the better decisions its operators can make.

Now Louis has posted some results to his website. (Though as a web designer he makes a better comedian; I had to use Evernote Clearly to read the annoying red-on-black text.) In the four days since it went on sale, it has sold 110,000 “units”, earning $550,000. It was a live show and tickets mostly covered its original cost. Louis says that after hosting and PayPal costs, he currently has a profit of over $200,000.

This is less than I would have been paid by a large company to simply perform the show and let them sell it to you, but they would have charged you about $20 for the video. They would have given you an encrypted and regionally restricted video of limited value, and they would have owned your private information for their own use. They would have withheld international availability indefinitely. This way, you only paid $5, you can use the video any way you want, and you can watch it in Dublin, whatever the city is in Belgium, or Dubai. I got paid nice, and I still own the video (as do you). You never have to join anything, and you never have to hear from us again.

He notes that “[if] anybody stole it, it wasn’t many of you. Pretty much everybody bought it.” He is very excited about the success of his experiment, and plans to try making other content available that way if all continues to go well.

How about that? If you don’t treat the customer like a potential thief, not to mention sucker, you can sell cheaply and openly and still make a profit. And the video’s only been on sale for four days; who knows how many units it will sell in a month or a year?

Of course, as CNet points out, not every artist can do what Louis has. For one thing, he’s famous already (a viral video of his appearance on Conan and a TV show he stars in have helped), and he is able to produce his own content (shades of e-book self publishers, eh?). And he also has novelty on his side—he’s the only one out there trying something like that right now. If everybody does it, will their experiments prove as successful? Or will people just consider it the new status quo and go right back to pirating?

(Found via TheNextWeb.)

Speaking of Louis CK’s viral video, I thought I had mentioned it here before, when last I discovered it, but I can’t seem to find it in a search of the site, so I guess I didn’t. The comedian talks about how much technology has changed the world in his lifetime, and how ungrateful we all are at how “amazing” the world is now. “When I was a kid, we had a rotary phone. We had a phone you had to stand next to, and you had to dial it. You ever realize, how primitive—? You’re making sparks, in a phone.”

It puts me in mind of people who complain about some of the features of e-books while paying no mind to the fact that you can now carry as many books in your pocket as might have made up the entire library of an educated man a few decades ago. And the books that people used to consider to be the Classics, the very foundation of all rational thought in the Western world, are all free. (But how little we ever take advantage of that!)

So says a blog post by Charles Stross, and it makes a lot of sense.  An article in Gigaom picks up on this:

This kind of insistence on DRM and incompatible platforms, as well as the tangle of rights and often competing interests of publishers and authors when it comes to licensing copies or sharing, makes e-book buying a snake-pit of complexities — and only reinforces Amazon’s hold on the market, since it offers a simple end-to-end solution. This makes sense for the retailer, and its focus on launching new platforms like the Kindle Fire make it obvious it plans to extend that dominance into other areas. But how does that help publishers and authors? To quote Stross again:

As ebook sales mushroom, the Big Six’s insistence on DRM has proven to be a hideous mistake. Rather than reducing piracy, it has locked customers in Amazon’s walled garden, which in turn increases Amazon’s leverage over publishers.

Publishers — and some authors, especially those who control the Authors Guild, which has fought every attempt by Google and others to open up the book market — have been so obsessed with piracy and locking down their products that they have allowed Amazon to take control of their fate (if that reminds you of Apple and the music industry, that’s probably not a coincidence). Instead of making it easy for readers to download their authors’ work on different platforms and share and copy it, they have only made it easier for Amazon to control them and dominate the industry.

The report states that around a third of Swiss citizens over 15 years old download pirated music, movies and games from the Internet. However, these people don’t spend less money as a result because the budgets they reserve for entertainment are fairly constant. This means that downloading is mostly complementary.

The other side of piracy, based on the Dutch study, is that downloaders are reported to be more frequent visitors to concerts, and game downloaders actually bought more games than those who didn’t. And in the music industry, lesser-know bands profit most from the sampling effect of file-sharing.

The Swiss report then goes on to review several of the repressive anti-piracy laws and regulations that have been implemented in other countries recently, such as the three-strikes Hadopi law in France. According to the report 12 million was spent on Hadopi in France this year, a figure the Swiss deem too high.

The report further states that it is questionable whether a three-strikes law would be legal in the first place, as the UN’s Human Rights Council labeled Internet access a human right. The Council specifically argued that Hadopi is a disproportionate law that should be repealed.

 

(Via Cory Doctorow on Boing Boing, under a Creative Commons license.)

Zachary Knight at Techdirt reports that last week, Ubisoft Shanghai creative director Stanislas Mettra seemed to imply that a PC version of the game I Am Alive would not be coming out because there were too many pirates and not enough customers on the PC platform. “If only 50,000 people buy the game then it’s not worth it,” he said.

After a flood of bad publicity, Mettra hastily backtracked, or “clarified”, saying that there had probably been a miscommunication because he was not a native English speaker—what he had meant to say was that piracy concerns were why the PC version of the game hadn’t come out yet, and whether there would be a port or not was not his decision.

To be fair, I don’t have the full text of what he said, just the snippets of the interview that IncGamers quoted in its article. He doesn’t explicitly say anywhere that the game wouldn’t be coming out, he just says he doubts the gamers who are complaining would buy it if it were available, and that piracy makes porting “hard”. So it could have been the simple miscommunication he says it was.

But there is a history of controversy surrounding Ubisoft’s use of DRM making its games harder for people to play (we covered it here, here, and here), and it seems the company is quick to blame piracy for any problem in the gaming industry. As Knight puts it:

Really Ubisoft, this is getting old. I feel like a parent scolding his child for the 20th time about hitting his sister. You think the child gets it after the first time and that the second time is an honest mistake. But, when the child continues to hit his sister, you need to take drastic disciplinary action. What will it take to get the message through to those in charge at Ubisoft? Gamers want your games and will buy them, but you have to provide the service they want. That is the only way you will succeed.

Of course, as e-book fans know, we have our own problems with publishers in that regard, and it’s simple to substitute “publishers”, “readers”, and “e-books” for “Ubisoft”, “gamers”, and “games” in the paragraph above and let it be just as true.

Valve: Piracy is a ‘non-issue’: “Managing director says piracy is a “service problem.”

Gabe Newell, Valve managing director, has claimed that software piracy is a “non issue” for the company’s Steam gaming service. Instead, he said that the fundamental misconception about piracy is that it is motivated by price, when Value believes that its more down to problems with service.

“For example, if a pirate offers a product anywhere in the world, 24/7, purchasable from the convenience of your personal computer, and the legal provider says the product is region-locked, will come to your country 3 months after the US release, and can only be purchased at a brick and mortar store, then the pirate’s service is more valuable,” he said, in an interview with Cambridge Student.

More in the article.

(Via AfterDawn.com.)

If the big six began selling ebooks without DRM, readers would at least be able to buy from other retailers and read their ebooks on whatever platform they wanted, thus eroding Amazon’s monopoly position. But it’s not clear that the folks in the boardrooms are agile enough to recognize the tar pit they’ve fallen into …

The publishers certainly have shown an awareness of Amazon’s disturbing tendency to poke its camel’s nose further and further into their tents—that’s why they implemented agency pricing, after all. But so far, they seem locked into the mindset of clinging to the fig leaf of DRM, while publishers like Baen forego it and can thus sell to anyone regardless of platform.

Will Amazon eventually drive publishers into ditching DRM in self-defense? We can only hope.