BitTorrent, EMI, And The MPAA All Misunderstanding DRM In The Same Day
from the fun-for-everyone dept
Earlier on Monday we had decided to ignore the stories about EMI bailing out on supposed talks to sell unprotected MP3s as well as the story about BitTorrent launching a ridiculous “authorized” movie download site that even the folks at BitTorrent seem to recognize is guaranteed to fail thanks to the inclusion of DRM. However, trying to figure out what to write about the “DRM Panel” at Monday’s Tech Policy Summit has had me stumped for the last few hours until I realized that all three fit together.
The panel was supposed to be about DRM and interoperability, but barely touched on the interoperability part, preferring to remain firmly focused just on DRM. Again, I was disappointed in the panelists for not really stating much that was new. It was a stacked panel (again). Gigi Sohn was there as the sole defender of consumer rights and fair use, but missed out on multiple opportunities to points out that the DRM everyone else was defending wasn’t just about a fight between content producers and consumers, but that it was simply bad for business.
The rest of the panel, led by the MPAA representative, David Garfield, kept saying over and over and over again that DRM was important because it opened up new business models. Yes, we’ve heard this all before. We’ve been hearing it for years, and those business models aren’t forthcoming. When that was brought up, all Garfield and the others could say is to give it time. Unfortunately, people have been giving it plenty of time and all they have to show for it is that they feel like criminals in their own homes for doing something that’s perfectly legitimate, and worries about what MPAA-pushed legislation will invade their technology next. The reason there are no “new business models” forthcoming from DRM is that it fundamentally takes away value. You don’t create new business models on providing the customer less value. You create new business models by providing them more value. The “new business models” don’t exist, because they’re fundamentally blocked by the concept of DRM.
What became clear after the discussion is that very few people are willing to actually step back and realize this. Pretty much the entire industry has simply decided that DRM is the only way to make money — even with repeated examples of why that’s simply not true. With EMI, the talks broke down over the fact that the music wouldn’t pay up in advance to cover the supposed “risk” of offering DRM-free songs. In other words, EMI wasn’t looking at dropping DRM because it realized that it would help their overall business of promoting and selling the music of bands in its roster, but because it was hoping to score a huge upfront payment from the likes of Microsoft.
Meanwhile, the MPAA sits and waits for some mysterious magical DRM-based business model that everyone loves — rather than noticing the insanely long history of failed experiments with DRM. The movie industry offers a product where DRM should be the least of its worries. It’s an entertainment product that has always been about the experience of seeing the movie. If the MPAA’s execs ever realized that they were selling the experience rather than the movie itself, the issue of DRM would be seen as something that blocked their ability to sell more, rather than helped it. This is seen in the BitTorrent deal as well, which is set up to fail thanks to unnecessary DRM that offers no benefits and plenty of pain points. An audience member asked the panel why every movie download service ever created has completely sucked. Garfield proceeded to claim that you have to give them credit in that they’re only just starting, and none of those services have been around for more than a year. He said that if we check back in a year, they’ll all be much better. Except, that’s totally false. CinemaNow and MovieLink have been around for more than four years and still suck.
The industry is going to continue digging itself into a hole as long as they all insist that DRM is necessary for a business model. It’s only once they ditch that myth that they’ll realize there are plenty of other business models — and those business models have the opportunity to bring in a lot more money by providing more, not less, value to customers, giving them more, not less, of what they want and treating their best customers like people who they want to do business with, rather than criminals.