Attempts To Stop Music Sharing Pointless?

job0 writes "An interesting paper (Word document) has been submitted by some Microsoft employees (although they are careful to state that that the views are theirs and not necessarily Microsoft's) to the 2002 ACM Workshop on Digital Rights Management stating that attempts by the record industry to stop music copying will fail simply because a) the growth and availability of affordable broadband and cheap data storage devices and b )ability of users to circumvent any DRM measures means that the number of people willing to swap is growing and will soon outstrip attempts to shut them down. The paper goes to suggest that the record industry should concentrate their efforts on trying music cheaper and easier to get hold off. I wonder if Hilary and friends have had a read. The BBC is also carrying the story." (OpenOffice has no problem with the paper, btw.)

Comments

therefore...

[erikdotla]

Users can circumvent everything... except Palladium! That's right, our patented DRM technology is the ONLY thing that our report indicates will be immune to these devilish file-sharing schemes! Sign your record label up today before your business goes to pot, and recieve a free Microsoft Toaster! (Requires MS Bread and an MS Power Converter, best served on MS Plates with MS Utensils.)

Re:therefore...

[Anonymous Coward]

Wrong, it indicates that all Pd's effect on DRM will be is to limit the number of locations that unprotected copies of DRM-protected files are inserted from. They are aware that even Pd will be cracked at a limited number of points. The very best they can do is to try to make the crack expensive, troublesome and risky or destructive to the hardware, but at a budget of around $2,500 and one week of time for the first key (the price of the cheapest TCPA motherboard and much less time for subsequent keys and to foil even watermarking you only actually need two, although three helps), the hardware is breakable.

A correctly designed P2P network (for the canonical example, Freenet, although it sacrifices everything else, including efficiency, for this property and is therefore damn awful at swapping, say, OGGs and MP3s) masks these locations in any case, mirrors the file, and foils attempts to remove it.

This is analogous to the current situation with appz - vis a vis, skilled crackers in groups upload them, not random people. This is an improvement on the random P2P warez, because the average quality of the resulting material goes way up (quality is one thing that P2P isn't well known for).

Of course it's pointless

[Blackneto]

Trying to stop any popular activity brings more problems than intended. I'll use as an example Prohibition of Alcohol in the USA. It was a big boost to Organized Crime.
Who knows what kind of problems the MPAA is making for itself by going after something that has been done since recording devices were made available to consumers.

Re:Of course it's pointless

[mangu]

something that has been done since recording devices were made available to consumers

Well let's go back to the 1930s, during the Depression, when technology was very primitive, records were made of shellac, very noisy and easily broken, holding no more than 5 minutes or so of music on each side.

Imagine if, on those times, people were able to listen to music for free. Imagine a hypothetic technology, let's call it "radio" for lack of a better name, that could bring music for free to each home. Why would anyone buy a record, in those very hard times, if they could listen to music for free? Obviously, the music industry would never have developed, and one would be totally unable to get any sort of music today!

Re:Of course it's pointless

[raynet]

You're forgetting that listening music for free isn't nearly as good thing as listening to music you WANT to hear and WHENEVER you choose to listen it.

Re:Of course it's pointless

[dkhoo]

Your comparison to Prohibition is very apt. It is the professional piracy syndicates that the RIAA and MPAA should be most afraid of. The more effective their DRM, the more it plays into the hands of organized crime.

Let's say that PERFECT DRM were achieved, down all the way to the speakers, microphones and recording equipment. The only way to overcome this would be:

1. Get a soundproofed professional recording studio, the best possible DRM speakers. Strong encryption forces this.

2. Develop high-quality illegal non-DRM microphones and recording equipment.

3. Rerecord the tracks and burn them to non-DRM CDs.

4. Sell them on the black market to support the expense of the above.

5. PROFIT!

With digital technology (TM), generational losses are limited to just one generation!

Guess who are the ones who have the capability to do this? That's right. Organized crime. By using DRM to shut down file sharing, the RIAA and MPAA force the possible economic benefits from technology out of the hands of the consumer, into the hands of -- not themselves! -- but the mob.

Prohibition all over again. They never learn.

Re:Of course it's pointless

[Bios_Hakr]

I'm not really sure where you are going with this reference to radio. Radio has nothing to do with mp3. When I buy a CD (which happens rarely), I convert it to mp3 and drop it into a directory on my hard drive. When I go to a LAN party, it is shared out along with ISOs (I create custom ISOs of my games and include the latest patches and nocd cracks, mainly because I hate looking for a CD to play a game) of my latest games. If someone wants an mp3, they take it.

The difference between this and radio, is that the person obtaining the mp3 from me never paid the license fee to the copyright holder, but he still has a permenant copy of the song. OK, you could record the song from the radio, but the quality would be crappy and most stations talk at the beginning of the song and fade another song into the end. If you listen to the radio, the station is paying the copyright holder for you. If i'm not mistaken, the fee can be quite high for the broadcaster.

I guess you could make an argument about my purchacing the disc pays the license for all the people I give the song to, but that's not really true in relation to radio.

I guess the point I'm trying to make is: Radio is _not_ free. Your fee is being paid by someone else.

BTW, the reason I share anything I buy with someone else is: The people who pirate something would have rarely bought it to begin with. And on top of that, it's my way of dumping the digital tea into the harbour.

Re:Of course it's pointless

[Beliskner]

Trying to stop any popular activity brings more problems than intended. I'll use as an example Prohibition of Alcohol in the USA. It was a big boost to Organized Crime.

OK. Let's do a proper balanced analysis here.

For DRM
Any and all music will be available to everybody for free at the click of a Kazaa button. Impossible to make money out of this, even for artists, unsigned artists don't have expensive mixing equipment nor gay extroverts with pink-haired poodles
Creating "popular" music/movies that all your customers like won't make you money, sending a message that success is not rewarded financially, nobody in the United States/World will want to get a job, therefore Capitalism will collapse and Sharia Law may be imposed by a replacement power (I'm not joking)
When the ROI on making songs and forming bands becomes zero, there will be no new music, radio stations will constantly repeat 60's music. Where would we be without Britney/Madonna/MichaelJackson/ElvisPresley?
Piracy extends to movies, the majority of movies are flops, paid for by the big hyped up "standard" movies like Titanic, which is exactly what'll be affected by piracy (how many Chinese big budget $200million movies are there?) causing a collapse in the special effects and computer industries (AliasWavefront will go bankrupt)
If for 10 years no new "popular" music nor movies are created, there'll be a massive spread in depression and suicide rates - PEOPLE WILL DIE! In Civilisation 3 remove all Entertainment and see what happens

Against DRM
Stifles computer innovation, DRM-hardware allows monopolical tyranny, and impedes legitimate computer uses
Difficult to make transparent, therefore necessitates Comp Ed lessons and licensing of computer users "It's illegal to use a computer unless..."
Damages First Amendment freedoms
RIAA/MPAA not forced to explore more efficient distribution mechanisms
No incentive for musicians/moviemakers to add extras to movies such as theaters with laser shows and smell-a-vision

Re:Of course it's pointless

[binarybum]

> The people who pirate something would have rarely bought it to begin with.

?? no way. the people who are pirating desperately desire the stuff they're copying. Have you ever heard the pleas in a warez chat room? People pirate this stuff because they can't afford it . I can get 12 hit songs overnight, sure I'd love the higher quality CD originals with cover-art and all those extra tracks, but I could not afford to buy 12 CDs in one weekend.

Mangu is right. There is no reason for us to sympathize with artists or the riaa. we have glorified these people with fame and money for too long while real heros like medical researchers continue to work without recognition for peanuts. I hope this is the end of an era. If individuals are gifted and truley love the arts they will continue to create great work, but now let the limelight shine elsewhere. Isn't the world tired of hearing on primetime news about extravegant details of some barbie-doll singer with an oversized pocketbook and no real creative spirit to boot? I for one wouldn't miss such spectacles a bit.

true music lover

Music-sharing can't be stopped....

[Anonymous Coward]

... until all means of transfering files over the internet are stopped, and that isn't going to happen. Even if the powers that be manage to lock down everything technological down with DRM, there'll still be ways of bypassing it, and it only takes a single person to figure out how to bypass it for the file to spread around like the email 'viruses' did a couple of years ago.
As I've said a number of times, the music companies know that music sharing is actually increasing sales at the *moment*, but once broad-band becomes fast & standardised, sending a whole album will become as simple as sending a 5kb file... people will think "I'll download that" rather than spending half an hour downloading a file and thinking "I'll buy the album".
I can imagine albums being released, 'music warezers' cracking the DRM within hours, and the albums spreading like wildfire across every instant messaging client in sundry.

Makes sense....

[carlmenezes]

It's actually a case of stating the obvious. However, things never get accepted until someone "does a study" or "submits a paper".
It's the classic water leak problem...the RIAA is trying to bail out the extra water while what they should be doing is plugging the leak - ie. take out the root cause - expensive CDs.

This doesn't mean that file sharing will stop altogether. But it DOES mean that a LOT of people out there would cough up the cash because it doesn't burn a hole in their pockets. It also means that artists would get more revenue.

The problem though is that this means cutting all those profit margins - the RIAA would like to have their cake and eat it too. Sorry. Can't happen. In addition, trying to force the issue would just make sure that they end up with some super strict CD protection scheme which will hurt sales and basically backfire in the long run.

Also, it's not like CD sales have decreased. How many studies need to be published before they get it into their heads that sharing music also increases an artist's popularity?

Corporate greed makes you stupid and blind.

Re:Makes sense....

[SmallFurryCreature]

What many people don't seem to realize is that this is the RIAA, and the MPAA job. It is like asking a crack dealer to accept that crack is bad for youre health. But that is what he is therefore. These trade organisations where created by the industry to fight these kind of battles so the the music businesses themselves can go on with day to day business. If you look at the different companies then you will see that all of them seem to be trying their own little thing to follow the trends.

Don't forget that most music companies are giants. While to us a year may seem an awful long time to a multinational it takes that long to decide on the brand of coffee machines installed in the cafeteria. You can imagine how long it will take them to come up with a complete revamp of their business model. If you don't believe me try finding an example where a industry has changed their way of doing business in less then a decade. About the only one I can come up with is that "Prepay" on mobile phones. And this was a bloody long development wich went from prepaid cards for phoneboots to now Prepay for landlines.

Re:Makes sense....

[mangu]

You can imagine how long it will take them to come up with a complete revamp of their business model.

That's a good point and it's the subject of Clayton Christensen's book "The Innovator's Dilemma". He presents several examples, from earth excavating machines to retail stores, showing how well-managed large corporations are unable to shift their business model until it's too late.

In Christensen's jargon, downloading music is a "disruptive technology" which will lead to a whole new market, dominated by new companies. The current media giants will disappear, just like the vacuum-tube manufacturers never made it in the chip business.

Well gee whiz, like that wasn't obvious.

[Gldm]

I really don't see how anyone could think you CAN stop something like this, given the number of people involved in it. Ok let's try looking at it from a logical standpoint:

Given:
Anything someone can invent someone else can invent a way around

Alot of people are interested in file sharing.

Hardware adapts slower than software. (Software can just recompile, hardware needs to be fabbed, purchased, and installed).

Anything that can be read for "authorized" playback must be by definition readable, and therefore can be manipulated.

Therefore:

The contest of technology comes down to a battle of man-hours. Who can put more time in a war of outhinking the other? A team of 100 professional programmers, working 40-60 hour weeks, or 100,000 crackers working nights, weekends, and vactations? No contest.

Also, you run into the same problem as the clipper chip. If you try and hardware protect things, you're stuck with it until you can update hardware if a vulnerability is found. Unless people start buying new CD and DVD players every week, there's no way not to have a window in which someone has cracked your system so it can function as the users want.

Now if your total protected data was small, or you had unique protection for each piece of data, you could probably manage. But having a seperate encryption for each audio file in existance is absurd. Getting the player to work with it would be impossible, and if the player has to work, then there's a way for someone to get the data.

This isn't to say that no copyrighted material goes over filesharing networks, that would be impossibly naieve. However, there's not going to be much that can be done about it other than waging a war that's going to be impossible to win, just because of sheer numbers on one side.

We all know DRM can't work, but that's not it.

[Erpo]

It's very easy to understand why digital restriction mechanisms are absolutely incapable of "working" as their creators intended. I'm sure plenty of people will post on this below and it's already been discussed thoroughly on slashdot. What we really need to worry about is:
*What's going to happen when accessing content as we always have been able to becomes (to a greater extent than it is now) a criminal act?
*What's going to happen when people place their trust (and vital information) in a system that is fundamentally flawed?

Re:Sharing is not infringement in many countries.

[MoceanWorker]

right.. so i should be ashamed at myself for spending months upon months for producing a fifteen track CD with 3 other people and paying over $10000 for equipment and a studio, as well as recording the tracks to its perfection so that people would enjoy listening my music, to have you even have the decency to rip my music (without my permission) and share it willingly with anybody?

oh yeah.. i'm real ashamed now

MPAA: Any DRM crackable

[infolib]

The MPAA recently filed a comment on the danish implementation of the European Copyright Directive. The directive demands that "circumvention of effective technological measures" be made illegal in a way similar to the US DMCA The interesting part says:
the legal protection in Section 75c should not be interpreted to the effect that a technological measure must be unhackable. All technological measures can be hacked. It is for this reason that the WIPO Copyright Treaties and the Copyright Directive have introduced legal protection for such measures. (Emphasis mine)

The comment was submitted, because MPAA fears that only truly "effective" technological measures would be legally protected.

The digital file isn't the only thing people want

[Kirruth]

A product like, say, a movie DVD gives the buyer a number of benefits. One of these, the ability to watch the show in high quality on demand, comes with the digital file, and this file will always be copiable.

The physical commercial DVD offers a number of other benefits though. There are the sleeve notes, photographs, the idea that the item is part of a collection, or provides some kind of link to the people who made the show or its stars.

There will always be people who just want the digital file, but there will also always be others who want the other benefits. Just as in the same way that some people will drink water from the faucet whereas others buy branded bottled water.

they don't need to "stop" it

[ryochiji]

As it's been pointed out before, they don't need to "stop" p2p networks to stop file sharing. I speak for my self when I say this, but I believe many others will agree: If the music industry gets off our backs (i.e. no excessive DRM), and sells music for a decent price (i.e. lets us buy songs individually and for less than $1.00 each), I will stop using P2P services.

Yes, people will always "illegally" share music. But if given good enough of an alternative, I think a large portion of current P2P users will go back to legitimate means of getting music. And the industry will still make money.

DRM promotes "piracy"

[thoth_amon]

Not only is DRM ineffective at stopping real hackers, it actually promotes filesharing. Why? Because of all the things you can't do with a DRM disc:

1. Back it up
2. Make a playlist from it
3. Play it in your car or DVD player
4. Play it on your iPod/Nomad/etc

It's far easier to download your song from any one of a dozen filesharing services. All that's needed is one guy who figured out how to rip it. Many CD-ripping programs, including open-source programs, have already developed ways to circumvent most common forms of CD copy protection.

All DRM schemes are horribly misguided because they make it difficult/unpleasant to be honest, because they are easily circumvented, and because only a few people need to circumvent them for the whole world to benefit.

The ONLY solution that I can think of -- the general solution to piracy -- is to make it not worth the trouble to pirate the songs. If you can get a 320-bit unencumbered MP3 from (say) EMI's site, for $1, without having to hassle with remote queueing, poor quality, getting the wrong file... Most people will pay the $1 and that will be that. I would. But I would never pay a dime for DRM material unless it was for a research project on how to crack it. If I can't put it in my MP3 collection, it's useless to me.

The record industry is like any other evolutionary system -- they'll either adapt or die. I have no doubt some companies will survive and prosper. But those who think they can keep pushing the '70s industry model forever, propping it up with DRM and other nonsense, will spend all their money and then die.

All the current legal efforts are the last desperate attempts of a doomed evolutionary niche to be relevant. They are fighting so hard because they have little time left.

Re:DRM promotes "piracy"

[DarkZero]

All DRM schemes are horribly misguided because they make it difficult/unpleasant to be honest, because they are easily circumvented, and because only a few people need to circumvent them for the whole world to benefit.

Exactly. There's a new rule of business that came with the internet that a lot of businesses haven't figured out yet: If the pirate version of something is substantially better than the version that you buy in the store, anyone with the means to get the pirate version will choose it. It applies to music, to movies, to games... just about any form of entertainment. Many (most?) people don't mind paying $15-$40 (depending on the product) for their entertainment, but when they're forced to choose between a $15-$40 product and a free version of the same product that has more features and less hassle, they start to think differently.

Re:DRM promotes "piracy"

[deblau]

I hate to be a broken record, but once again, repeat after me:

You can't solve social problems with technology.

DRM is already doomed to failure as an idea, because it's technology that attempts to solve a social problem. Security and encryption will be around for a lot longer, because they don't shaft well-meaning people, but rather target only intruders and thieves.

Re:Sharing is not infringement in many countries.

[dago]

Just imagine that nobody shares your music. That nobody ever gave some of your records to someone else to appreciate.

(imagine)

I discovered many bands, small ones and big ones, that way, by copying tapes.

Music is sharing for me. Why do you think (some) people come to concerts ? For me, it's to share a moment of music with a band and all other people in the room. I don't think that just listening to music is the whole thing and that sharing doesn't play a role.

Also, I firmly believe that I have the right to do whatever I want with your music, including sharing it, as long as it's not commercial.

Anyway, that's no black and white issue (like many).

Re:Sharing is not infringement in many countries.

[DoctorPhish]

You should be no more ashamed for producing an album than for producing buggywhips. Production and sales are two completely different animals. Regulating file-sharing is about as effective as regulating the flight patterns of geese. Even if DRM prevents digital ripping, once the signal hits analogue it can be re-digitized at near-perfect quality. At that point, there is no more degredation. The industry is effectively at the mercy of the consumers at the moment, and they're going to have to come to grips with this. Just because a business model has been profitable for close to a century doesn't make it a god-given right. Oh, and I own a small record company ^_^;

Piracy has always been the same problem anyway

[91degrees]

People assume that they have certain rights, which legally they may not have. They will often wish to make a compilation tape (legally), and also often want to give the compilation tape to someone else (probably not legal)

In this case, the law doesn't matter to people. They know they're not doing anything wrong, and would be quite shocked to be accused of stealing. They aren't stealing. They bought the tape/CD. You can argue that they're wrong, but I'm not the person you should convince. Everyone else is.

The thing is that people want to be able to do this. Even if you can stop them with a perfect DRM system, people will not accept it. It prevents them from doing something that they want to do, and the vast majority have no moral qualms over. If the majority disagrees with the law, then surely the law is wrong, not the people.

Re:Piracy has always been the same problem anyway

[foniksonik]

Best arguement so far, by far. Supply and Demand. we live in a capitalist nation, when society wants something and can see no harm coming from it (to society) then society will have it. If you want to make money off this you must meet societies' expectations or the people will find their satisfaction somewhere else.

As it is people already feel like they are 'paying' for P2P because they pay for the bandwidth. What other incentive do they have for broadband? We would all do just fine browsing text and a few images with a 52k modem. Rich media isn't just what corporations and media want to provide because the internet isn't Cable TV.

The RIAA still doesn't understand the medium they would like to exploit, hence their problems.

Re:Piracy has always been the same problem anyway

[NineNine]

If the majority disagrees with the law, then surely the law is wrong, not the people.


In most cases, I'm glad as hell that "the people" don't directly make laws. The US would be a mess. Now in some cases, such as drug laws, it's a combination of the people demanding to be heard *and* there not being a good reason to have drug laws at all. With creative media, at least lawmakers realize that without copyright, there's no incentive to create any more. People have bills to pay, and if you can't pay your bills by writing, performing, etc., then most people just aren't gonna do it. Most people are incredibly stupid. They think in the short term, not the long (hence massive credit woes in the US, at least).

MS continually amazes me

[hype7]

Talk about left hand not talking to the right hand. (yes, I saw the disclaimer about views not being their own etc). If MS has employees, employees that are obviously involved in digital rights management and secure document/media distribution (an assumption based on the topic of the paper), then why the hell has MS spent all this time and money on pushing ideas like Palladium, and secure music within WMP?

I mean, these guys put forward a logical and convincing argument - and yet still the behemoth churns out anti-consumer crap like "limited copying" in WMP and "trusted computing" with Palladium. What's the goddamm point?

I'm not a big MS fan, but seriously, I think it's time for a generational change at the top. Ballmer & Gates are still thinking in late 80's and early 90's terms for so much of MS's strategic decisions... they're gonna go the way of IBM.

Actually, maybe they should leave management as it is... :)

-- james

DMCA didn't come from nowhere (mildly OT)

[OldMiner]

European Copyright Directive. [ukcdr.org] The directive demands that "circumvention of effective technological measures" be made illegal in a way similar to the US DMCA

Realize that it isn't the DMCA where this comes from, but rather from the World Intellectual Property Organization (WIPO) and a treaty agreed to by some 38 countries. Few of those countries, oddly, are in the EU, even though the treaty was signed in Geneva. Article 11 of the treaty reads:

Article 11
Obligations concerning
Technological Measures

Contracting Parties shall provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures that are used by authors in connection with the exercise of their rights under this Treaty or the Berne Convention and that restrict acts, in respect of their works, which are not authorized by the authors concerned or permitted by law.

Article 12 is also interesting, but more or less a corollary. It requires contracting parties to make it illegal to remove copy management information from a work or knowingly transmit a work which has had this done to it. I'd love to see a good page listing to what degree this treaty has been put into force of law in agreeing countries.

$1/music is way too expensive

[mangu]

Years ago, I bougth a few CDs for $1.99 each at BestBuy. They were classic music, produced by the Pilz Media Group, from Germany. That price paid for printing the CD itself, printing the label and liner, the jewel box, shipping from Europe to the USA, retailer's expenses and profit, and taxes. Oh, yes, and it also paid for the musicians.

I would gladly go to a music store and buy CDs at that price, instead of downloading anything. But why would I pay $15 for downloading the music that fits in a CD? Someone would get the CD itself, and everyone else would download it. Let's face it, if the full cost for producing and distributing a CD is less than $2, on-line music shouldn't be more than $0.10 / music.

Re:$1/music is way too expensive

[eyeball]

$15? What part of the country do you live in? I went to go buy a CD (my first in years, and not because of MP3s, but because I don't like music that much). Almost all the cd's I saw were $20.

You know, I worked in a record store during the intruduction of CDs. At the time they priced cd's roughly double the cost of records and tapes, to supposedly cover the lack in supply and demand. The promise was that as CDs replaced tapes and records, the price would be adjusted. Well, here we are, and not only has the price not gone down, it's increased beyond financial environmental factors (inflation, consumer price index, etc).

Re:Sharing is not infringement in many countries.

[mangu]

Until you can convince me that your music is worth paying for, you are $10000 in the red. And you'll never be able to convince me just by mentioning how much you spent. A crappy 10 second teaser won't do it either. I need to listen to a music several times before I decide to spend any money on it.

Look at it from your clients point of view: if you think you are entitled to get something for your $10000, why can't we make sure we are getting something worth it, before we pay $10 for your CD?

Send $1 to the Artist

[cdf12345]

You know, by sending a $1 or $5 bill to the artist you are supporting them a hell of a lot more than their label probably is. I know a lot of bands that would much rather have their music be available and have fans simply send them $5 if they like it or whatever than get their 67 cents per CD sold in retail stores.

Maybe it's hokie or whatever, but I bet when an artist gets a hand addressed letter with a crisp $5 bill in it, they remember why they started making music in the first place.

Re:Send $1 to the Artist

[aronc]

In other words, they remember they got into music for the money?

You missed the point. They will remember that they make music for people to hear it. Getting a letter from someone tells you that this person, this exact person not some hypothetical number in a mass but Mr. John Doe heard your music. And not only did he hear it he liked it. He liked enough to go out and find your address, put a pen to paper, and put five bucks from his pocket to yours. There is a huge difference both emotionally and spiritally between that and another few dollars at the bottom of an accounting statement.

What Was Left Out

[MrSubtle]

Interestingly enough this analysis left out what I think is the most important factor in determining what will happen in this arena and that is whether there's a non-pirate alternative to the "darknet". The lack of a legal large volume, reasonably priced, non-crippled service that sells a gigantic library of stuff drives people to illegal sharing services (which offers all of that except the legal part). So much an issue that I think that this pressure toward piracy generated by lack of legal alternatives is even stronger than the fact that the file sharing systems are free!

I know that I would buy media online if the idiots who owned it would just bother to take my money. The problem here is not so much taht people pirate media, it's that the media companies don't provide any reasonable alternative. (Aside from "Wait for ten years until we get our act together and until then shut the hell up you whining customers!" that is.)

THE DARKNET WILL PWN JOO ALL!

[ArcSecond]

What a dramatic term: The Darknet. Rhymes with "Terrorist" and "Pedophile", I suppose.

Anyhow, my point:

Can anyone see how DRM will actually WORK work? Like, we end up with a stable set of technologies that make it very difficult (if not impossible) to pirate copyrighted media? I can't.

All I can forsee is a quicksand scenario where the DRM technology changes so quickly, in an effort to stay "one step ahead" (hah!) of pirates, that the average user experience is complicated beyond What The Market Will Bear. Who wants to buy a cd player for their car, when in two years they will have to replace it to play the New CDs?

I'm guessing the trend will be towards digital radio and play-once licences. Selling discs is like selling tapes is like selling vinyl. Once you've sold it, it's no longer under your control.

BTW: Other than a slight degradation in signal, and a lot of sitting around waiting, what is so hard about taking an analog signal and re-digitizing it? Isn't this a pretty good low-tech way to get around any form of CD-based DRM?

Will they awake?

[InrdZQdxdqn]

Will they music industry just stop these stupid efforts to play with their rules and finally addapt themselves to the new market?

Right now, because of copy protection systems, it is even more interesting for the users to buy a pirated CD. When they should be thinking of how to add value to their product -like including video images or extras with the cd- what they are doing is making their product lose value.

Have they ever thought of using new technologies - online distribution to retailers, CHEAP downloading services, online registration for cd owners to get some extras...- to make a better cheaper product?

How long does it take to any of us to get the songs through internet and then burn a CD? 15 min, half an hour? Don't they tell me they cant offer a competitive service given the massive economy of scale they are playing with...

Yes, this should be their way. Compete with file sharing networks.

Legitimate business

[Gary Franczyk]

I'm sure most persons here know that there is a large cost involved in the promotion and discovery of talent. It is probably true, that illegal file sharing is probably going to really hurt the music and movie industries in the future. Why not take this line of thinking to its final outcome?

When this happens, you will probably see the result of the reduced funding for things like:

MTV
radio stations
fewer new artists
less promotion
fewer gold and platinum records
fewer concerts

Yes, fewer concerts. With less money for promotion and advertising, and fewer people aware of in love with the record companies' artists, how are they going to fill the concert venues?

How are the "artists" going to live like millionaires after even the most popuplar cannot sell more than a few hundred thousand copies of their album? There will be less of a disparity between "discovered" artists and ones with record deals. MTV Cribs will be kind of boring.

Will MTV be able to pay for a Times Square office space for TRL? Probably not.

If the rappers were poor, think of what would happen to the 20" wheel industry alone! :-)

Re:Legitimate business

[Anonymous Coward]

(Sorry to be anonymous I haven't registered yet- luxomni)

Some of your points are valid, and some are not. The large cost of developement of talent is somewhat of a misnomer. How many of you can remember a friend's garage/small nightclub band coming home and saying "We got a record contract" and then nothing ever happened? I have known several. The deal is that the record companied in a Faustian move sign restrictive exclusive contracts with groups that keep them out-of-circulation for years. A very few of them ever get into a studio. (BTW, the labels don't pay the same for studio time as you) Less actually get recorded. An even smaller number get pressed. Fewer yet get released. And a tiny few get promoted. a Couple become million sellers and next contract have the power to negotiate a contract that actualy pays them anything.
The name of the game is restraint of trade. Your garage band is not a source of revenue for them unless you already have a very substantial regional following, and even then most likely you are more dangerous as a threat to their chosen preformers success.
Read the lyrics to Pink Floyd's "Welcome to the machine", or Courney Love's (Gawd, I never thought I would quote her) essay on Napster. This stuff isn't new. Frank Sinatra founded BMI because of the same restraint of trade from ASCAP. The performers are generally screwed on record royalties. No one makes money but the label.

* SO, fewer new artists? I think more and better.
Narrow-casting rather than broadcasting. We have hundreds of new TV stations on satellite/cable. Do we watch TV less? Not exactly. Do we watch ABC/NBC/CBS less? Absolutely! Wait, two of those are also record labels. Could that be a coincidence?

*You are right that there would be a bit less promotion money for concerts, but not necessarily less concerts. Performers now make their money from concerts and not record sales. (Record royalty is almost exactly the same as in 1955 when I was first aware of it.) Also, promotion money is an expense against the performers take.

*MTV won't be hurt as much as you think. Check the ads - Clearsil and Sanitary napkins far more than Record Labels. Maybe a bit less perks and payola for the producers. They might even have to buy their own coke. But MTV has evolved anyway. Music makes up a much smaller part of their world to culture in general.

* Radio Stations? It's a wash. A lot depends on their playlist. In many places oldies stations outdraw top 40. Wonder what that says about the product? In any event the coke ain't flowing as free as it did in the 80's.

* Fewer Gold and Platinum records? Hopefully, fewer award shows too. These things are just self-congratulatory. Besides, I can't speak for you folks, but aside from DSOtM and the Doors first album, nothing I like is that popular anyway. My tastes are more personal and less mainstream. (BTW, those gold records come from the same RIAA that we all love so much)

The record industry does have a few ligitimate points, but they have never cut a performer an even break - much less us of the great unwashed.

Re:Legitimate business

[Melantha_Bacchae]

Gary Franczyk wrote:

> I'm sure most persons here know that there is a
> large cost involved in the promotion and discovery
> of talent.

Sure, the dumb way the evil sharks do it has a large cost. High paid exec goes through large numbers of hopefuls (takes a while and he is high paid) to find someone *he* likes. The promotion that follows is mostly trying to brainwash the world into thinking this performer has any talent. Many hours of high paid exec's time plus much slick advertising equals large cost and a lot of non-talented "pop stars".

On the other hand, a college student/musician has a professional recording studio (a Mac, some hardware and software, some microphones, cheap soundproofing from the hardware store he put up himself, etc.) in his basement. He records some mp3s and puts them on the P2P networks. Some people sample them, and tell all their friends (off and online) that this guy is awesome. Word spreads, and this guy has a market for his CDs that he sells online. The equipment pays for itself, because of his CD sales, and the recording and web site design he does for his fellow student/musicians.

Lower cost (free after the equipment and web hosting costs) promotion, no discovery costs, the artist gets to keep his copyrights and gets the lion's share of the money. Multiply him by hundreds and you have a new, better, music industry growing in the shadow of the old. Plus the guy has a choice of careers and real experience to put on his resume.

Sorry, all you Mr. and Ms. High-Paid Music Execs out there. We don't need you. We would have better music without you. :b

"They bind our hearts: 'Let's sell them again and again!'
Our plan understands the sea; we can wait for her coming."
From the song "Infanto no Musume" in the Japanese version of Mothra (1961).

Follow the money

[Get Behind the Mule]

"Follow the money" was Deep Throat's advice to Bob Woodward, and that's what will define the conflict that is yet to unfold in the music industry. The record companies have been making gazillions for doing little of value for a long time, and now technology is tearing away the means by which that has been possible. They are going to fight ruthlessly to maintain the status quo. Look for lots of cash flowing to politicians, who in turn will try to prop up a doomed industry with draconian law. It's going to be a long, nasty, high-stakes battle.

Although the RIAA loves to squawk about the artists losing money due to file-swapping, the fact is that the artists get nearly nothing in the present system, and the corporations keep almost all of the moolah. This despite the fact that they contribute literally none of the value that consumers pay for when they buy music. You can't just replace Alicia Keys with Madonna; but it is completely irrelevant whether a CD is published by Warner, Universal or my cousin Vinnie.

They've been able to do this because they have had control over three elements of the music business:

1. Production (studios, CD manufacturing)
   
2. Marketing (promotion, concert tours & control of most of mainstream radio)
   
3. Distribution (ownership of most of mainstream record stores, control over CD rack space in the stores)
   

Now, technology has loosened their grip on all three of these areas, especially the last. Neither the corporations nor anyone else can control how music is distributed any more -- it is, or could be, entirely in the hands of consumers. And distribution networks have a "word-of-mouth" effect on spreading knowledge about new music, so that corporate marketing is a little bit less important. And although they still run the studios, and probably always will, manufacturing CDs is almost obsolete now. All you need is a file; the costs of replication are nil, and consumers can do it all themselves.

I believe that most consumers would be willing to go along with schemes by which they pay for copied music, as long as the music costs significantly less than it does now (say, $1 for a CD), and if most of it goes to the artist (say 90%). The record companies will get much, much less than they do now, because we hardly need them any more. Of course, they do some work that is necessary and should be compensated, but it will end up being much closer to their true economic worth -- and that means a very small fraction of their current income.

But before that happens, they are going to bite and scratch and scream, and it's going to be ugly. They have a multibillion-dollar cash cow, and they will do everything in their power to save it.

Why I buy CDs.

[Big Mark]

I have a fat unmetered broadband pipe to my PC. I can download entire albums in the tiume it takes me to fix a coffee. Yet I still buy three or four CDs a month. Why?

I'll tell you why.

1) CDs sound better.
Most Internet monkeys can not encode mp3s to save themselves. My sound setup cost me a bomb so I can tell the difference between 192kbps and the CD itself.

2) CDs are not just music.
Some album sleeves are works of art in their own right (e.g. Tool - Lateralus). There is also an assosciated boast factor in having proper CDs compared to home-burnt ones - like the difference between a beige box and a Cooler Master. There are subtle physical differences, but the Cooler Master owner is infinently cooler than Mr. Beige. And that's partly why he bought it.

3) If I didn't buy CDs, the artists would stop making music.
Even if I'm talking about purchasing demos straight from the bands themselves. Giving the band my money, no matter how indirectly, helps ensure that they will continue to make music in the future.

Hint: go get CDex and use the LAME encoder at 192kbps (or make it vorbis). All my CDs are ripped like that, and my WinAmp list all sounds great.

-Mark

Re:Why I buy CDs.

[deblau]

3) If I didn't buy CDs, the artists would stop making music.
Even if I'm talking about purchasing demos straight from the bands themselves. Giving the band my money, no matter how indirectly, helps ensure that they will continue to make music in the future.

One small issue: Your argument that artists wouldn't make music if they weren't paid is utterly false. How many bands do you think make their music without any real hope of making it? Maybe every single garage band?

People do art because people like doing art.

Re:Why I buy CDs.

[Idarubicin]

3) If I didn't buy CDs, the artists would stop making music.

What if you went to their concerts? You pay for the privilege of seeing them actually making music. If they want to get paid, they have to get up and perform. I know; it's a really old revenue model. Worked for minstrels, though.

Few more questions

[abhikhurana]

Well, many people are saying that the music industry willl survive if they started aoffering cheap downloads of songs. Well, both EMI and Universal are working in this direction. Infact Universal has already made about 43000 songs availaible for download, and they cost 99 cents per song.
These songs are in wma and liguid audio formats so that they can build DRM protection into it.
But the big question is do we want songs with DRM? If yes, why do we want them so? So that we can redistribute them? Would it be fair to redistribute songs which we downloaded for 99 cents to millions of people using Kazaa? Why are songs any different from licensed software?
What exactly is the ideal solution that we are looking for?

Sharing is Communism. ;P

[ArcSecond]

Not to beat up on you any further (I see the other geeks have done a pretty thorough job of that), but I disagree. Your investment of time, talent, and money in making the album is just that: an investment. Nobody guaranteed you a profit.

Now, given the REALITY of the situation these days, you have a choice: sign a contract with a label, let them run things, and hope you get some money out of all their hype and networking. And get pirated, if anyone likes your stuff.

Or, you can go directly to letting people pirate your stuff, and with a little marketing effort of your own, hope that enough people want more of the same to make your money back.

I'd say the odds are pretty tight either way. Playing gigs aint exactly a goldmine either, though. So tough for you: you are finding out that being a musician/composer does not guarantee you a life of leisure and wealth. Join the club.

So cry me a river about your production costs. If you had a reasonable expectation of making money on it, you probably already did before the mp3s started flying around. And like everyone says: prove that pirating hurts sales overall.

Anyhow, it comes down to this: do you want people to hear your music, or do you want to make money. They can't BOTH be your first choice, man.

tyranny and rebellion

[Anonymous Coward]

what should be noted from history is that besides just the availability of the means to rebel, it is actually more important the cause. If DRM (or anything by a different acronym) interferes with law abiding consumers rights to their own property (like in "fair use") or just have to run circles merely to get the latest media to operate correctly, then said consumers will quickly tire of it. What is left is to A) quit buying the media or B) utilize alternative methods.

Many will not want to steal, that is a fact at least at this point (I won't say "most", just "many") that should be capitalized. There really are those that would use a system that pays directly to the artists and direct management even. What organizations like the MPAA and RIAA are more afraid of is NOT the theft of music, but the eventual rise of pay for play systems that would cut them out.

Think about it... what is the purpose of management, producers, lawyers, marketers, etc when it comes to music and movies? Answer: Very important, it is what actually puts the media out there in a usable format. It is what organizes the distribution and makes deals with various vendors (i.e. theaters and stores). These groups (RIAA, MPAA, etc) have like most bureaucratic organizations, mutated into a beast that spends more internally to keep their own infrastructure up (justifying their own existence) than performing their primary task. The end result is a reduction of efficiency (results or output) at a higher cost (input). Like all things in our society, it is the savvy industry that embraces the surrounding changes instead of running from them in order to reap the benefits. Had these groups spent their resources on adaptation instead of futile efforts to stop the media trading, then they would be in a VERY good position now. I think they realize that and like a child that made a mistake they are now throwing a temper tantrum for all to see.

To a band, movie producer (not publisher), etc... the only thing they want is an efficient method to create and distribute their product/service. If they can do this through the web (or at least utilize many parts of the web) and therefore bypass the more costly (in time, money, artistic freedom, etc) venue of a formal RIAA affiliated management organization then why would they want to stick around with the bloated management group?

In any socialist situation you end up inevitably with a welfare program that, as mentioned above spends more on internal infrastructure than in its primary function. The US government's steady fall into this system shows agencies full of internal bloat and inefficiency that has more internal support roles as it does the actual roles directly supporting their stated "customer." Why should the government have all the fun? Many companies would like to create such a self justifying organization that views its existence as a measure of sheer volume rather than actual output of goods and services. The problem is (much like with the government) that there is really only one road for such organizations... collapse from within. They will therefore lash out with all their collective might in an effort not to adapt, but to grasp and restrain the flowing waters of expectations tied to the observable change. Change is the only constant (and Death is the most constant of changes) yet these people live more for the static than the reality of the world. Why would you even TRUST such an organization that cannot even grasp the most basic tenets of the universe?

RIAA and MPAA are going down... sad thing is, they don't even realize that it is because of their own misguided efforts that it will happen.

lessons from porno

[Anonymous Coward]

surely the adult entertainment industry was more threatened by the internet than the record or movie industries were. so, where's the porno lobby that's trying to stop p2p?! it's all about embrace and extend. granted that sounds a little rude in this context... but i'm sure it's business rhetoric that movie and record industry execs have heard a thousand times before. how about putting it in to action? there're obviously insurmountable problems with the old business model, so here's another bit of biz-rhet for ye: adapt or die.

Re:The Future...

[octalgirl]

If the big labels continue to impose restrictions on CDs, the bands that are really into music will simply leave the label.

No, they won't. Because they have iron-clad contracts and they are not allowed to leave unless the label kicks them out. The labels have full control, and the artists will be just as trapped as the music lover. Look at Dixie Chicks, they tried to leave Sony, and after a long court case they finally settled and came to better terms (Sony realized how bad it would look to let them win, esp after earning over 200mil off of them while the girls only got 50k each). Anyway, they are still with Sony, that's how strong those contracts are.

Something I sent to the RIAA

[foniksonik]

Back when this first came up in major news... june 2001:

This is in regards to the proposed plan to 'protect' copyrighted audio recordings distributed via CD.

I think you are making a big mistake, as other consumers will confirm for you when your products are either boycotted or wholesale pirated as a result of this 'protection'. Regardless of what you do to 'protect' this material individuals will make recordings and redistribute to the demanding public. (Any CD player that supports your new 'protection' is certain to have a standard AV port, a really easy way to re-record audio data.)

Ever hear of a thing called supply and demand? Nothing you do will stop this. The only thing this proposed plan will do is take away any control you currently have.

The biggest problem you have created for yourself is pricing albums at $15 - $30 each. Consumers feel as if they are paying enough to justify redistribution to close friends, etc.. especially when they may only really enjoy one or two of the songs on the album. Selling singles of hits isn't enough.. the radio usually plays those particular songs enough.

Your only rational recourse is to create a distribution channel which adds value to your products which consumers will pay for. Obviously they don't feel the current situation provides enough.

One idea is to create a subscription service, wherein the user would get to pick out several songs or albums from the genre they subscribe to. Consumers might prefer to have a complete set of songs from which to make their selection instead of the mixed and potentially corrupted selection they have from online sources. For this service you could charge a monthly rate dependent on the genre or number of downloads, etc. use a focus group or something to decide how to bill people..

I think you'll find that all people want is the selection of songs they get to listen to without the overhead of buying every CD that comes out. People also like the fact that when they 'get over' a particular song they don't feel like they wasted their money. Some music does 'get old' rather quickly.

What I'm saying is that you need to abstract the value you are selling from individual recordings or artists. Music is an ephemeral sensation... what gets me going one day may change the next, that's why radio works, they can adjust for the current environment. Not to mention that there is sooooo much music available now, compared with 20 years ago. Personally I don't have the time to listen to it all but I can listen to the song a friend recommends or sends to me via ftp etc... do you get it. We don't have time to go to the store to buy the cd that has one song we like and if we're going to take the time to buy it online we may as well spend the same amount of time finding a free copy.

By providing 'free' access to all the types of songs that I like you would make it alot easier and quicker for me to find the music I enjoy. How about charging me $15 a month for access to 'hip-hop' or 'rock' genres with a full search on title and author so I can grab 20 songs I really want to listen to that month. What's to keep me from keeping them and trading them? Nothing, but why would I want to go to all of that trouble when I have the convenience of my monthly selection online. Storing all that data is a real pain. Keeping track of which song is on which cd is also a pain. Programmers have spent lots of time trying to make free software to keep track of that stuff and none of them do it right. Plus, you get $15 monthly from me just so I have access to new titles, old titles, whatever, in a convenient and time saving system, w/o the overhead of storing them all, etc.

Okay, do you get it finally. We want service, selection; added value. We won't pay for anything less (ie: cd's with just the songs on them)

Sincerely,

Heh...

[Decameron81]

Man, those big companies need nothing like DRM to stop p2p networks. They just need their boxes in the network sharing corrupted copies of their copyrighted content. Considering most of the new p2p sharing applications make use of advanced protocols that let you copy files from several people at the same time they would just need a few boxes sharing content on high-speed connections and voila'... you're making it hard to get the right thing. And this is DRM free.

Remember, the weak point of p2p networks is that not everyone wishes to share... so they would only need to make sure that what they want to share (the corrupted file) is ALWAYS available for a big number of connections. Hell someone could even start a company to offer this service to media giants for a small ammount of money, and I bet the bastard would become rich in a matter of weeks.

Heh, I better go copyright this idea before it's too late. ;-P

Decameron

Not exactally a pointless venture

[nurb432]

It DOES make it difficult for the common non-techie person, which is 90% of their market..

Plus it adds more foolish restrictions and absurd laws that the rest of us have to deal with/work around.

When will they learn?

[grundie]

I agree toally with the whole DRM is pointless argument, simply because as long as record companies charge ridiculous amounts for music then people will look for a cheaper source of music elsewhere. In the case of music and movies its P2P systems that people turn too.

Recently it was announced in the UK that singles sales had halved since 1988, why 1988? IIRC 1988 was the year that CD sales started to make an impact on vinyl sales. I alse remeber noticing that a CD single cost £2.99 in 1998 but a vinyl single cost £1.99. The same trend applies to CD albums they are more expensive than their vinyl ancestors. We are also seeing it again with DVD.

Now I don't know if it is cheaper to produce a CD/DVD then their analogue ancestors, I would say it is, despite what some people say about patent royalties etc. All I know is that record and movie companies use every little excuse in the book to put their prices up and make more profit, completely oblivious to the fact that they are alienating consumers. Is it no wonder we turn to P2P systems when it costs £16.99 for a CD and £19.99 for DVD? There is also the irony that the costs of developing DRM and copyright protection technolgies is passed on to the consumer, alienting us even more!

They need to learn that if they reduce the prices of thier products, people will buy them rather than copy them, simple really? In fact I would go as far as saying the record companies are following a business model that is doomed to failure. Does a department store raise its prices and force people not to share clothes they buy when their sales drop? Nope, they reduce prices to encourage people buy more clothes. When will the record and movie companies learn the basic concepts of how businesses operate?

Solution to piracy

[GabrielStrange]

I think another solution to piracy is to create something of genuine value that can only be attained if you purchase the CD legitimately. It amazes me that record companies are not conducting market research to determine what such "extras" would be best to motivate people to purchase their CD's. Case in point -- I know a lot of people who've purchased copies of Blizzard's new "Warcraft III" game because with a pirated copy of the game, you can't login to Blizzard's Internet play servers and play against other users across the world. And this is clearly a feature that almost any player of the game is interested in. Case in point -- Some DVD's contain things like extra angles for some scenes, dubs of the speech in the soundtrack into other languages or large photo galleries that can't be converted into JPG's automatically. This type of content can almost never be downloaded online, and people buy the DVD in order to get a hold of it. Case in point -- The latest CD from Garbage contains a unique ID that allows you to subscribe to their web site, where you can download software that allows you to create your own unique remixes of some of the songs on the disc. While this didn't motivate me to purchase the disc personally as the software is only available for Windoze machines, I know several people who did purchase it for exactly this reason. If record companies are concerned about CD sales, they should make this sort of thing the norm. They should be spending their money researching the best way to motivate people to purchase the CD, not on ways to stop people from downloading it. Unfortunately the problem with big business is that they almost never think about giving consumers more value for their buck. The idea is simply abhorrent to them. They can't wrap their tiny little minds around it.

Re:Is it me or does the RIAA screwing up?

[LostCluster]

The RIAA looked around for a role in the new Internet economy, and then realized it didn't have one.

There are now many new ways to distribute music to computers electronically for very little actual cost. Tapes, records, and CDs used to be the most effecient way to deliver music to consumers, but now that is simply not the case anymore. It is much easier and cheaper for the user to download music than to get it in any physical form.

What the RIAA hates to admit it's in the artists' best interest to get their music in front of consumers by any means possible, even if that means not getting paid for their initial recordings. Britney Spears isn't rich because she recorded albums, she's rich because she used the popularity those albums gave her to do large arena concerts, pose for multiple posters, license her name on all sorts of toys aimed at young girls including a form of Barbie doll, and sell tickets to an otherwise poorly-done movie simply because she was in it. She possibly could have more money than she does today if her music was distributed free to listeners, because being more popular leads to more profits in those other businesses!

The music industry is moving to a "widget frosting" model of business. The main item gets given away free, but that main item tempts the consumer into buying accessories which make the whole system profitable.

The reason why the RIAA is running so scared right now is because there is no place for them in the new model. The artists can simply place .mp3 files on their own website and then fill the site with sales pitches for upcoming concerts, posters, T-shirts, etc. without having share the profits from such transactions with any record label. The record labels become needless, and evaporate.

My Favorite Quote

[GeorgeH]

While not from the paper in question, my favorite quote on the topic is "The marketers can compete with free; it just has to be better. Look at bottled water if you don't believe me," - Jonathan Potter, Digital Media Association.
(Found at http://www.oreillynet.com/pub/wlg/1982

Pretty much sums up my feelings on how the entertainment industry can survive.

filesharing is_not_free

[abe ferlman]

I guess the point I'm trying to make is: Radio is _not_ free. Your fee is being paid by someone else.

Well, when you download from someone, the person you download ripped the mp3's from a cd, so they have paid the license fee, or perhaps it was who they downloaded from - *someone* paid the license fee. Maybe they recorded the song from the radio, and so the radio station paid the license. But someone paid.

Price point?

[MacAndrew]

buy songs individually and for less than $1.00 each

I curious about the incredibly low price (IMHO) many expect for individual songs. I suggest the price for individual songs should be relatively high -- like singles at the record store -- and entire albums sold as a package discount. The singles price accounts for overhead and transaction costs, as well as the songs that didn't do so well but still cost money to produce.

If $1 is the most you think fair for that great song ... well, haven't we all used a jukebox now and then? How much is it worth to us merely to hear a song with crummy fidelity JUST ONCE? There are other differences, but I'm suggesting a price scale. Parenthetically, that $1 price won't work with current payment schemes because a third would be eaten up just processing the payment. (That's a whole 'nother problem...)

Anyway, it is not ethical to try to extort better prices from the industry by telling them I'm going to go on breaking the law until you do what I say. It's not like they are putting an extortionate price on your daily bread. If you don't like the prices, give up the product. If it weren't for fricking piracy (and you need no quotes around "illegally"), which no I don't do, the industry wouldn't even bother with DRM; after all it costs money and good will.

True, as a marketing strategy, lowering prices will decrease piracy. But you can't spin that around to say that piracy is a vlid strategy for reducing prices. That's just rationalization for what you want to do anyway.

Re:Paper forgets quality

[michael_cain]

It doesn't consider quality (except for the simple case - it works vs. it doesn't work because it's DRMed), and a lot of warez spread does, in fact, consider quality. Would you rather have a shakycam, a good telesync, a transcoded dvdrip or a true, non-transcoded progressive master from good quality film? Would you rather have an awful two-disc VCD, a two-disc SVCD or a one-disc XVID? A 64kbps mp3 encoded with Xing, a LAME VBR --alt-preset standard mp3, a q4 (128kbps nominal) Vorbis, a q6 Vorbis or a lossless FLAC, APE or SHN? Who'd want a crack that's less than 100%?

This topic can be addressed by an extension of the arguments given in the paper. The paper argues that technical DRM will not work (fundamentally because technology favors the attackers, not the media companies) and legal enforcement of DRM will be difficult at best (due to overlapping small darknets). That leaves economic solutions to the "problem," something I've been arguing for for years.

Most "pirated" copies do not represent lost sales for the content owner. Individuals with large libraries of MP3s (for example) would not have purchased the CDs for all of that content if the MP3s had not been available. Content owner revenues are maximized by setting the prices appropriately. The best price is not necessarily the one that maximizes the number of disks sold. Major-league baseball teams, as an example, generally find that revenue is maximized with ticket prices that leave 10-20% of their seats unsold.

Quality should also be reflected in the price. If the choice is between a 64kbps MP3 and nothing, then the MP3 might be a good deal. Different people will make different choices between the MP3 and a lossless original based on the price. Even in the darknet world, these things have different "prices" in terms of storage space, download bandwidth, and availability.

Re:If it's done correctly...

[stickyc]

Thus, the DRM has to be at the end source, at wher the final product is released(ie. the speakers, the TV screen, etc.)

So to support this new technology, you're asking consumers they have to effectively scrap their entire system?
The depressingly slow adoption of new consumer equipment to migrate to the "required" new HDTV broadcast standards in the US is good proof of this model failing in real-life. Arguably, high-definition TV is a lot more value-added than protecting the already-hated record industry's bottom line.

If it came to that, I'd go back to vinyl.

DirecTV commercial

[DickBreath]

I recently laughed myself silly when I saw a DirecTV advertisement for internet service.

The first thing in the commercial is a guy in a music store going to the counter holding several CD's. He says: "I'd like track 5 and 6 from this one, all of this one, and (several forgotten) tracks from this one." Then the ad breaks into promoting that you can make your own mix CD's by downloading all the mp3's you want.

If a big corporation can actually promote downloading mp3's in a national (?) advertisement, then what does this say about how mainstream, recognized, and accepted the phenomena has become?

Hillary Rosen would be spinning in her grave if she saw this ad.

History will defeat attempts to stop CD piracy

[Broadcatch]

The BBC had a good writeup on this paper a few days ago. My comments follow:

Once the cat is out of the bag, so to speak, it's hard to put it back. The government (and the RIAA and the MPAA, who have strong governmental forces behind them) can certainly slow technological adoption, especially when the money flow to the rich and powerful is threatened. But the "natural order" of technology will prevent it from being squelched for long. For example, P2P networking - the heart of any truly free communication process whether electronic or interpersonal - has been temporarily squelched with the recent demise of Napster. But while P2P still thrives in the underground, quietly P2P is finding its way into the mainstream, for example IBM's YouServ.

The RIAA (to pick a target) built their business model on scarcity - creating first vinyl, then CDs, was something the public couldn't do, and they provided a service. They developed that service into an empire, and now they are using lawyers and laws to enforce an artificial scarcity to protect that empire.

What the folk at the RIAA have failed to grasp is that the world is changing. Though they will no longer be able to gouge the artists, they are in a unique position to drive the future distributed music business model. One possibility is for the RIAA to take the pulse from the 'Net and promote the acts that people want to see, rather that pushing the acts that they have signed to a market segment. The power shifts from corporate to public, but there is still room for corporations to make a lot of money - if they act in the public's best interest.

So given that the RIAA is not leading the way into the brave new world, we can expect to experience a period of instability during which many new technologies and business models will be created along with as many, if not more, laws attempting to preserve the aging status quo. Bottom line, I believe that there will be a music business in the future. But as it will be distributed and likely open, more people will make more money, and a few will make much less.

Finally, I'll bring up the Grateful Dead. They were the top grossing band of their time, and they made it off of performances, not album sales. In fact, they are famous for encouraging people to tape and trade their live concerts. They made money and their promoters made money. Ultimately, for any "software" (defined as anything that can be reduced to bits) the money is in the timely creation (performance), backup, search and retrieval (libraries, Google), authentication ('is that really an authentic <fill_in_the_blank>?') and support. Classic distribution channels are dead.

Similarly, government efforts to curtail technological advances such as encryption and (Internet) free speech have lost. Such efforts will be again doomed (ultimately - though perhaps not without great struggle) when they return (in all probability) as part of Homeland Security.