Everyone’s favorite DRM-hater, Cory Doctorow, has pointed us to yet another “DRM server shut down so the content you ‘purchased’ goes away” story. Walmart, Yahoo, Microsoft, now Fictionwise . . . None of them seem to understand the problem with DRM. I’ve stopped buying infinitely copyable goods. i don’t believe in pirating software or music, but I refuse to pay for something that should be free. That’s part of the reason I’m using Linux, listening to music on Jamendo, and things like that. They recognize that you can give away the infinite goods and use them to increase the value of the related scarce goods. I will not purchase anything with any sort of DRM on it. And you shouldn’t either.
Tag: failed business model
WalMart caves on DRM
BoingBoing | WalMart now says they’ll keep the DRM servers on forever I wrote about this when WalMart first announced that they were revoking your ability to play the music you “bought” from them, but it looks like they’ve changed their mind, just like Yahoo. Well, not quite like Yahoo, but the same idea. They’re going to leave their DRM servers on for some undisclosed additional time. BoingBoing seems to think they’ll leave them up permanently, but the press release doesn’t actually say that. Regardless, WalMart is paying real money for their mistake, and it’s always nice to see that. Except in this economy where we need WalMart to keep the entire country from going bankrupt. Then it kind of sucks.
If you buy anything with DRM, you are stupid
And there’s another in the long list of music retailers who decided to turn off their DRM servers, effectively taking back the music you “bought”.
As the final stage of our transition to a full DRM-free MP3 download store, Walmart will be shutting down our digital rights management system that supports protected songs and albums purchased from our site.
WalMart is actually telling people to burn their DRMed music to cd so they don’t lose it. This is a pretty callous way of telling customers that WalMart doesn’t care about them. I don’t really understand how there can’t be a better solution. Is it really that hard for WalMart to leave a server running that just always says, “yes, you’re authorized”? It is increasingly clear to all those paying attention that any business model that depends on some sort of DRM is doomed to fail. And those who buy DRMed goods are doomed to lose them when the seller decides not to support it anymore. Let that be a lesson – DRM is anti-consumer. Always. Anyone who tells you otherwise is either mislead or lying.
Would this business model work for writers?
I’ve spoken before about alternative business models for authors – some way to get paid for writing while at the same time embracing digital distribution and the economics of infinite goods. Techdirt talks about music artists getting fans to help pay for the creation of a new album – fans give money and the artist uses that money to produce the album. Then, the artist has some options for what to do with the music after it’s created, like selling cds or giving it away for free or whatever they want to do. This might work for writers, too. Not all writers, maybe. But let’s say you’re a talented writer without a book deal. You set up a blog and connect with people who love the type of books you want to write. Give away free short stories or excerpts from your novel-in-progress. Then take money to produce the book. People who donate maybe get a discount on a paper copy, or a signed paper copy, or whatever other non-scare goods you might be interested in producing. If you’re really good with your non-scare goods, you can give away the resulting ebook when you’re done writing. This builds more fans, and helps you get more money to produce the next book. I think it’s harder for authors to do this than musicians, because it’s harder for the author to come up with compelling non-scarce goods to sell. They have no equivalent of the live show (At least for the vast majority of authors). But at the same time, producing a book, especially an ebook, is vastly cheaper. In fact, with a little computer knowledge, it’s almost free. So what your fans are really paying for is your time more than the production of the book.
Infinite goods want to be DRM-free!
I’ve gotten into a little discussion on DRM and ebooks over at Feedbooks. If you’re interested in potential business models for authors in a world of infinite goods, hop on over there and join the discussion. Especially if you can contribute more than me (That is, if you can do more than parrot what you read on Techdirt).
Way to go, Yahoo
Techdirt | Yahoo Offers Refunds Or DRM-Free Music In Exchange For Shutting Down DRM Servers Looks like Yahoo is going to make things right for customers who bought DRM’ed music at their old store. They’ll either replace the music with DRM-free editions, or give refunds. Unlike Microsoft’s band-aid (Keeping the DRM servers up for a few more years), this is an actual solution, righting the wrong that Yahoo did to its customers by “selling” them music that could be taken back at any time.
Yahoo isn’t as bad as Microsoft
Yahoo! Music Store Will Compensate Customers For DRM-ed Music Looks like maybe Yahoo will make it right for people who thought they were actually buying songs, rather than renting. Good for Yahoo. I hope the “compensation” details are actually consumer-friendly.
Where Microsoft went, Yahoo will follow
“All those years the music industry spent insisting that the only way they’d sell music is with crippling DRM attached managed to totally discredit the idea of buying music at all.”
could [Yahoo] seriously not have noticed the massive backlash that Microsoft received for telling people that it was turning off its DRM servers, effectively locking all the songs people had “bought” to their current computers.
I thought I’d written about it a little while back when Microsoft decided that the servers that check to see if the music you’ve “purchased” from Microsoft’s music store is legal or not were no longer necessary. That meant that all the music you thought you “bought” from Microsoft was really just being rented, and now they’d decided to terminate your lease because they didn’t feel like complying with the deal they made with you anymore. And now Yahoo is doing the same thing. All the music you “bought” from Yahoo won’t work anymore if you move it to a different computer. I’ve said this numerous times, and I’m not alone – if you pay for ANYTHING that has DRM attached, you are NOT buying. You are RENTING at the discretion of whoever is taking your money. Some people may be okay with that. I’m not.
The MVNO road is not the one you want
Blogging Stocks | Google’s one chance for Android – become a wireless carrier
The competitive landscape is so tightly controlled that Google’s mantra of “open access” just won’t sit well with wireless carriers used to telling customers what they can and cannot do with their phones.
This is very true. Time and again, the major US wireless carriers have rejected anything they can’t control. But there are a ton of things wrong with this article. First, Verizon announced last year that it’s opening up its network. I’m sure it won’t be as open as it could be, because Verizon is a bunch of jerks, but it’s still a step in the right direction. Second, I think Google’s name will drive some openness. You know how all the carriers want a piece of the iPhone? Look for that to happen again when a few sexy reviews of Google’s phone operating system start cropping up. Like Apple, Google has a sometimes irrational following. People will assume it’s good just because it’s Google. The article continues to state, “the MVNO model has largely failed in the U.S.”. That’s very true. Amp’d? Helio? Bye-bye. It doesn’t seem to be a sustainable business. Google isn’t really into failing, and they’re not stupid. But the dumbest thing the article says is the final line. Google should buy its own space on someone’s network and “give them anything they want. Like, mobile search results with ads next to them.” This is just a fundamental misunderstanding of some or all of the words in that sentence. I think he means “location-based search”, not “mobile”. I want my phone to do a Google Maps search, and I want the default location to be right where I am, right now. Simply making search “mobile” just means making my computer small enough to carry with me all the time. The real “synergy” of phone and search is that the phone already knows where you are. Now it just has to tell your search engine. It’s nice that Google Maps remembers my default location, but with a location-aware wireless device, there’s so much more it can do. Even worse is the idea that people want ads next to their search results. Search customers don’t want ads. We put up with them because they’re unobtrusive, they’re likely to be relevant to what we’re looking for, and they’re a small price to pay for an otherwise free service. If the ads went away and the search stayed the same otherwise, you would get no complaints from anyone not making money on the ads. I’d like to see Google completely skip the US market. Just go to Europe where the networks are open. Verizon and AT&T; and Sprint will come around pretty quickly when everyone who comes in to buy a phone wonders why they can’t have a Google phone. Well, everyone who isn’t there to buy an iPhone, anyway. Or maybe Sprint’s Samsung Instinct, which is apparently doing really well. Certainly Google has the cash to throw at their own chunk of network. But they didn’t get this successful by throwing money at dumb business ideas. I can’t imagine they’re going to start now.
The future of paper
Seth’s Blog: Do you own trees?
Many businesses act as if they have a stake in their suppliers and other vendors. Instead of scaling the part of their business that can move quickly and well, they defend the part they don’t even own.
Many in the music industry are figuring out that there are new ways to make money. As Techdirt says, every aspect of the music business is growing rapidly except the sale of plastic discs with music on them. And Godin says, “there are more people reading more news every day than ever before”. He doesn’t substantiate his claim, but I’m willing to give him the benefit of the doubt. And then he talks about the book industry.
I worry about my esteemed friends in the book publishing industry as well. The amazing thing about the Times story today was the report that the mood at BEA was ‘unease’ about ebooks. The fastest-growing, lowest cost segment of the business, the one that offers the most promise, the best possible outcome and has the best results… is causing unease!
This is what hits closest to home for me. I like to maintain that I have a book or two in me somewhere that will come out eventually. But I look at the industry of selling pieces of paper with words on them and I think it’s in trouble. It hasn’t happened yet because no one has made the book equivalent of the iPod (No, you didn’t do it, Amazon. The Kindle is kind of cool, but not there yet), but ebooks WILL be better than books. It’s inevitable. We’ll all miss the feel of paper in our hands, but we’ll get over it because of all the things you’ll be able to do with electronic words that you couldn’t with paper ones. And since the marginal cost of producing an additional copy of an ebook is nothing, the price of ebooks must go to zero in an efficient market. Sure, the book industry can go down the same route as the music industry did and put artificial barriers in place to drive up prices. But that kind of an industry can’t last for long. It’s economically inefficient, and it’s insulting to the customer who just wants not to be treated like a criminal. So, how do we get authors to write more books? Sure, JK Rowling can make money without selling paper books. The top authors in the world, and some who hit small but dedicated niches, and some other authors in special situations will all make money. But what is the equivalent of concert tickets in the book industry? Speaking engagements? That might work for a few, but not for most. I don’t know the answer. I don’t know how we can replace the paper book industry with the ebook industry. I wish I did, because I’d be in good position to make a lot of money.