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A Working Economy Without DRM?
Tilted Equilibrium asks: "In a few weeks, our school will be hosting a panel on DRM with several respected individuals. In advance of the panel, I have been doing some research on the topic and thinking about it in my free time. In economics, we learn that the price of a product is determined essentially by supply and demand. Without a DRM in place, we are capable of making as many copies of a piece of content as we want and seeding it onto the net. How do you create a market for a product, and make money of a product that has a huge initial creative investment, but then no manufacturing cost, and is in infinite supply?"
a) Start wars to limit the production *cough-iraqwar-cough*
No, seriously:
b) Make performance the product (concerts) instead of the brochure (CD)
c) Increase the value of the product (like linux distro's do) by selling life-time licenses in music stores, give a life-time guarantee on the hardware (CD), include extra "off line" art, etcetera. Just compare it to OSS. The first record company that only does special editions and doesn't whine about downloading might just sign up a few thousand of bands willing to take the risk to try to make money in a modern way.