November 18, 2006

The Top 10 Arguments Against DRM

One question we get a lot here at LearnOutLoud is why we’ve chosen to go DRM-free with our digital downloads. I’ve explained it to a number of people and written a number of posts about it but I’ve never summarized our reasons for going the DRM-free route in one post before. So here goes… (And if you have no idea what I’m talking about or what DRM is please click here.)

1. DRM doesn’t prevent illegal use of files, it just makes it a bit more difficult to access them. A lot of publishers are under the impression that once you put DRM on a file nothing bad will happen to that file ever. It just ain’t so. There are a multitude of tools out there that allow you to strip DRM off of files relatively easily. So while DRM might make illegal sharing a bit more difficult if someone really wants an unprotected/unencrypted version of the file it’s not very hard to do this. This is an important point because…

2. All it takes is one person to crack the file and it can be made available to everyone. Most illegal trading of files happens over P2P networks. The thing with P2P networks is that it only takes one copy of a file to be unencrypted/unprotected to have that file be available to all. Check any P2P search engine and you’ll find a multitude of titles that are supposed to only be available for sale online as protected files. Of course, there is one other possibility…

3. Anyone selling content on CD is already selling unprotected files anyway. With the exception of debacles like the Sony rootkit, 99+% of all CDs sold contain unencrypted files. This means that anyone who sells content on CDs is making unprotected content available and that putting those files online is as easy as ripping them to MP3 files, a pretty simple task these days. What boggles my mind is record companies and publishers who are willing to make content available unprotected on CD but for some reason insist on copy protection for digitally downloaded files. Especially considering that…

4. DRM adds a lot of costs for content producers – Implementing DRM isn’t free of course. The costs to develop and/or license DRM technology, encode media files and deal with a multitude of DRM-related customer service complaints are usually passed on from the retailers to the content producers. What this means is that content producers make significantly less money selling DRM “protected” content than they do selling DRM-free content. Royalty rates offered to many content producers from online retailers are often pitifully low and DRM is typically used as a main reason why this is so. That’s a shame. Of course that’s not the only cost…

5. There’s a huge hidden cost in trying to sell DRM’ed content – In addition to the many costs of implementing DRM for content there’s a cost that is often overlooked: The sales you lose because people don’t want to buy DRM’ed content or have incompatible players. This is huge. There is a growing number of people who won’t buy any content that has DRM. In addition, because there is no universally compatible DRM standard, many people can’t buy your content if they don’t have a compatible player. For instance, if you only sell your content with Apple’s Fairplay DRM all of the people getting Zunes during the holidays won’t buy you content because it won’t play on your player (and vice versa of course). So by implementing DRM you are losing out on a significant (and unknown) amount of revenue.

So those are five good reasons why content producers shouldn’t implement DRM. Let’s take a look at five good reasons why DRM hurts consumers…

6. Often the costs of the DRM are passed along to the consumer as well. Since DRM isn’t free someone has to pay for it. Sometimes it’s the content producer in the form of reduced royalties. Other times it’s the consumer. Take the example of eMusic and Apple iTunes. iTunes tracks sell for 99 cents while eMusic tracks sell for 25 cents. One of the reasons why eMusic can sell its music for so much cheaper is that it isn’t spending tons of money implementing a DRM system and dealing with customers who are having DRM issues. So it is able to offer a technically superior product for a significantly lower price. Which is good and even better when you consider that…

7. DRM-free content will play on your device of today and your device of tomorrow – It’ll be a little shocker for some people in a few weeks when they get the new Zune device from Microsoft and try to load all of their Rhapsody or MSN Music tunes on it only to find that they won’t work. Why? Because Microsoft’s previous DRM (PlaysForSure) isn’t compatible with the new Zune DRM. And that’s an example of one of the biggest problems with DRM. It locks you into a specific player from a specific company. While that might be good for a hardware manufacturer like Microsoft or Apple it’s not good for you the consumer. Want another reason? Consider that…

8. Your media devices of the future will be significantly different than your media devices of the present. I discussed this point at length in my post The 5 Dangers of Buying DRM’ed Media. There’s a really good chance that your next media player won’t be an iPod and that in the not-too-distant future it’ll probably be your cellphone. If that’s the case then you need to be aware that any DRM-encoded content that you buy probably won’t work for you anymore. While millions of cellphones are currently shipping that play MP3 files, very few of them will play songs from iTunes or audiobooks from Audible.com. So if you’re at all interested in being able to play your content (the stuff you paid hard-earned money for) in the future you should think twice before buying anything infected with DRM. Furthermore…

9. DRM fundamentally changes who is control of your media. This might be the most esoteric of the arguments and is a bit difficult to explain but in a nutshell, when you buy DRM content for the first time in history, someone else is dictating to you what you can do with something that you’ve legally purchased. Watch this short video from the great folks over at DefectiveByDesign which illustrates this point nicely:

Finally, it’s really important to understand that…

10. Whenever you buy DRM’ed content you support the system of DRM – I buy DRM’ed content from time to time like most of you. However, I have realized that with each purchase of DRM’ed content I help to perpetuate a system in which DRM is acceptable. And at the same time, whenever I frequent a site that offers DRM-free content I’m helping to support a system in which DRM is viewed as unacceptable and a bad business practice. There are a ton of good sites out that offer DRM-free content (here’s another great list) and they could use your support. By rallying around these sites we can help to tip the balance and make this a world where the power is in the hands of people who produce content and legally purchase it.

Thanks for taking the time to listen to me ramble and I hope you now have a better understanding of why this issue is important and what you can do to help make this world a better for place for content producer and content consumers.