Does more e-book competition lead to more DRM?

On PaidContent, Bill Rosenblatt looks at whether we can ever expect a universal format for e-books, equivalent to “MP3” for audio. He doesn’t think so.

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.

2 Comments on Does more e-book competition lead to more DRM?

  1. I don’t think that it is correct to say that Apple “dropped DRM.” From all accounts, Apple persuaded the major labels to drop DRM so (I think) that consumers would perceive more value in the music that they bought and consequently buy more of it. One important aspect of that value is the feeling that you fully own a copy of a song. DRM defeats that perception and thus lowers perceived value.

    Now, iTunes sells more music that anyone else. Apple is happy, the major labels are happy and consumers are happy. Does this logic work for eBooks?

  2. Apple was not the first to drop DRM. Speculation was that other sellers were allowed by publishers to drop DRM before Apple to help break Apple’s stranglehold on the market.

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