DRM Doesn't Enable Business Models; Blind Fear Disables Business Models

from the get-over-it dept

A bunch of folks have asked if I had any comment on analyst Michael Gartenberg post over at Engadget claiming that DRM has been demonized too far, and for all the "bad" things about DRM, most people really don't mind it, and we should be happy that it "enables new business models." I've discussed this before, but not in a while, so it seems worth revisiting.

First, it's a lie that DRM "enables new business models." Gartenberg doesn't realize it, but he admits it in his post, when he suggests that DRM made all-you-can-eat subscription models possible, while immediately countering that point by admitting the real factors are elsewhere:
Take subscription services for example. Sure, I'd love a service that would allow me to download unlimited content in high bitrate MP3 format for a reasonable fee every month. Except economics and greed will never let that happen.
Notice what he says here. The DRM isn't what enabled the business model. It's fear of how people will use such a service that does. It's fear that people will actually use what's been given to them -- leading to the claim of "economics and greed" stopping such a service from ever coming about. But, that makes no sense. People already have access to pretty much every song ever recorded with no DRM at all. Claiming that they need DRM to enable such a service makes no sense. It's already there -- just not legally. So what does the DRM stop in such a service? Absolutely nothing. If the fear is that someone takes a song and shares it online... too late. It's already happened. The only thing that DRM does in that situation is put up a restriction on a legitimate, paying customer. That makes no economic sense at all.

And that's my real problem with DRM. It cannot enable a new business model economically. That's because it's only purpose is to limit behavior. There are no business models that are based solely on limiting behavior. It may be the case that some companies may be too afraid to implement a business model without this faux "protection," but that's entirely different than saying DRM enables the business model. DRM takes an economic resource and artificially restricts it. It takes away options, it does not enable them. DRM hasn't been "demonized." It's a pointless solution that prevents no unauthorized sharing and only serves to hinder the activities of legitimate customers.

Filed Under: business models, drm, economics, subscriptions

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  1. identicon
    Anonymous Coward, 26 Sep 2009 @ 12:22am

    DRM is a fantastic idea!

    DRM could have created markets and new forms to extract money from people but that is a pipedream, is like when we are children and don't understand the world and created fantastic explanations on how things work and grow up to be ashamed to talk about those fantastic ideas once you get it LoL

    Well I guess some are living in a fantastic bubble world to think DRM worked or will work if there is a thing people proved a thousand times already is that if they need it they will get it. Not even physical DRM work see MAME - Multiple Arcade Machine Emulator, those guy's hack the hell of security features to dump the microchips and then go on to analyze and rebuild all the circuit on software to make it work, and they do it without expectations with the funny thing being a vibrant market for accessories sprung up.

    A classic case of forced openness was when IBM decided to open the PC design for everyone because Apple was beating them at every corner. If IBM didn't did that maybe we would have taken more time to find ourselves with the vibrant market we have today for accessories and other things for PC's, it created a standard that everybody could use and not just one group of people and allowed IBM some space and to carve a market albeit all the new competition, with the alternative being the ejection from the market by other players and there is the AT&T being mandate to be sliced, which sprung a revolution in modern communications, if the monopoly wasn't broken up we still wouldn't have modems that were illegal when AT&T owned the phone inside your house.

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