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High Definition Video for Independent Filmmakers
A How To Guide for Digital Filmmakers
Welcome all! This is my blog to share my latest research,
thoughts, etc. on utilizing HD for independent filmmaking.
YES, I am available for consulting
Contact me at firstname.lastname@example.org
All content copyright 2004-2007 Mike Curtis.
Wednesday, February 07, 2007
Apple - Thoughts on Music:
Steve Jobs made an unusual move today, defending the proprietary DRM used in iTunes, and in offering alternatives pretty much taking a slap (how hard the slap you decide) to the face of the Big Four music labels. Pardon me for running long on this, it includes the entirely of Steve's screed (his in italics, my commentary in plain text), but for journalistic analysis, and the fact that I can run as long as I want on the blog, Let Us Dissect, tweezers and scalpel in hand:
With the stunning global success of Apple’s iPod music player and iTunes online music store, some have called for Apple to “open” the digital rights management (DRM) system that Apple uses to protect its music against theft, so that music purchased from iTunes can be played on digital devices purchased from other companies, and protected music purchased from other online music stores can play on iPods. Let’s examine the current situation and how we got here, then look at three possible alternatives for the future.
OK, a very interesting opening proposition. I like that Steve is directly addressing an issue....that has been floating around for years. Glad it is finally being addressed in this clear and public method.
To begin, it is useful to remember that all iPods play music that is free of any DRM and encoded in “open” licensable formats such as MP3 and AAC. iPod users can and do acquire their music from many sources, including CDs they own. Music on CDs can be easily imported into the freely-downloadable iTunes jukebox software which runs on both Macs and Windows PCs, and is automatically encoded into the open AAC or MP3 formats without any DRM. This music can be played on iPods or any other music players that play these open formats.
YES. This is often overlooked, and I am oh-so-annoyed whenever iPod opponents say "you can't play other music on the iPod!" Yes. Yes you can. It is called an MP3 file, they play anywhere, you should look into it sometime (and AAC is good too). I believe they aren't too difficult to come by or convert to, those shiny plastic discs the cavepeople still buy seem to be able to automagically be converted. iTunes can even be set to automatically convert, in minutes, any CD inserted to one of those formats as well, without so much as a single keypress.
The rub comes from the music Apple sells on its online iTunes Store. Since Apple does not own or control any music itself, it must license the rights to distribute music from others, primarily the “big four” music companies: Universal, Sony BMG, Warner and EMI. These four companies control the distribution of over 70% of the world’s music. When Apple approached these companies to license their music to distribute legally over the Internet, they were extremely cautious and required Apple to protect their music from being illegally copied. The solution was to create a DRM system, which envelopes each song purchased from the iTunes store in special and secret software so that it cannot be played on unauthorized devices.
Touché, Steve, I do so heartily agree with the validity of this statement - it is definitely the studios that are impinging upon you to slap a lock on the files so they can't be bandied about. However, this engenders one other tangential benefit we'll get back to...
Apple was able to negotiate landmark usage rights at the time, which include allowing users to play their DRM protected music on up to 5 computers and on an unlimited number of iPods. Obtaining such rights from the music companies was unprecedented at the time, and even today is unmatched by most other digital music services. However, a key provision of our agreements with the music companies is that if our DRM system is compromised and their music becomes playable on unauthorized devices, we have only a small number of weeks to fix the problem or they can withdraw their entire music catalog from our iTunes store.
Definitely a victory in dealing with the labels. However, another way of saying the first part is: "We have the least sucky deal out there." Also interesting to note the deadline/timeline to fix any leaks out there - the Hymn project breaks Apple's DRM every once in a while, and Apple makes changes to fix it again. The old measure, counter measure, counter counter measure struggle continues ever onward. I hadn't heard this detail before (had anyone else?), so it keeps Apple on their toes, honoring their obligation to keep FairPlay legitimately "tight" and leak free.
To prevent illegal copies, DRM systems must allow only authorized devices to play the protected music. If a copy of a DRM protected song is posted on the Internet, it should not be able to play on a downloader’s computer or portable music device. To achieve this, a DRM system employs secrets. There is no theory of protecting content other than keeping secrets. In other words, even if one uses the most sophisticated cryptographic locks to protect the actual music, one must still “hide” the keys which unlock the music on the user’s computer or portable music player. No one has ever implemented a DRM system that does not depend on such secrets for its operation.
All standard stuff, plus I love how Steve is able to get away using words like "secrets" in otherwise technical discussions. "Automagically" regretably does not make an appearance in this conversation.
The problem, of course, is that there are many smart people in the world, some with a lot of time on their hands, who love to discover such secrets and publish a way for everyone to get free (and stolen) music. They are often successful in doing just that, so any company trying to protect content using a DRM must frequently update it with new and harder to discover secrets. It is a cat-and-mouse game. Apple’s DRM system is called FairPlay. While we have had a few breaches in FairPlay, we have been able to successfully repair them through updating the iTunes store software, the iTunes jukebox software and software in the iPods themselves. So far we have met our commitments to the music companies to protect their music, and we have given users the most liberal usage rights available in the industry for legally downloaded music.
Kudos to Steve for fessing up and being very straightforward about the history of all this.
With this background, let’s now explore three different alternatives for the future.
The first alternative is to continue on the current course, with each manufacturer competing freely with their own “top to bottom” proprietary systems for selling, playing and protecting music. It is a very competitive market, with major global companies making large investments to develop new music players and online music stores. Apple, Microsoft and Sony all compete with proprietary systems. Music purchased from Microsoft’s Zune store will only play on Zune players; music purchased from Sony’s Connect store will only play on Sony’s players; and music purchased from Apple’s iTunes store will only play on iPods. This is the current state of affairs in the industry, and customers are being well served with a continuing stream of innovative products and a wide variety of choices.
"Well served" is a highly subjective statement. This is the first time I'd say we are straying from the clearly and demonstrably provable so far.
Some have argued that once a consumer purchases a body of music from one of the proprietary music stores, they are forever locked into only using music players from that one company. Or, if they buy a specific player, they are locked into buying music only from that company’s music store. Is this true? Let’s look at the data for iPods and the iTunes store – they are the industry’s most popular products and we have accurate data for them. Through the end of 2006, customers purchased a total of 90 million iPods and 2 billion songs from the iTunes store. On average, that’s 22 songs purchased from the iTunes store for each iPod ever sold.
Today’s most popular iPod holds 1000 songs, and research tells us that the average iPod is nearly full. This means that only 22 out of 1000 songs, or under 3% of the music on the average iPod, is purchased from the iTunes store and protected with a DRM. The remaining 97% of the music is unprotected and playable on any player that can play the open formats. Its hard to believe that just 3% of the music on the average iPod is enough to lock users into buying only iPods in the future. And since 97% of the music on the average iPod was not purchased from the iTunes store, iPod users are clearly not locked into the iTunes store to acquire their music.
...and thus Steve starts to clearly and demonstrably Stray From The Path of Clarity. The KEY issue here is not whether there are OPTIONS to acquire one's music, the point that we looked to see addressed was the fact that music purchased via Apple's iTunes Store is locked to playing on iPods. Thus, The Whinging Begins.
While it is possible to burn a CD from purchased iTunes content and then re-rip that to a non-DRMed format like AAC or MP3, there is a recompression loss. Want to play your purchased content on anything other than an iPod? You have to do some work and degrade the audio quality (and the quality of this purchased content is a whoooole other bag of gripes article).
I feel Steve is sidestepping the core issue here - music purchased from iTunes Store only plays on iPods, not Zunes or Creatives or anything else. Period. The fact that music is acquirable elsewhere is good, nice, and...extraneous to the point that led to this discussion in the first place.
However, this is a good and clear case as to what the reality of the iPod world is like - you buy some content, but you rip (or, ahem, "acquire") MP3s elsewhere for the majority of your content. This "97% from elsewhere" makes for an excellent defense against any accusations of attempted monopoly against Apple.
The unexplored question is this - of that 97%, how much of it was legally obtained, on average? Beyond that, I'd be curious to know, on average, what percentage of that iPod's 97% of remaining content:
1.) Was ripped from iPod owner's own CDs
2.) what percentage of those CDs are still in owner's possession
3.) what percentage came from ripping friends' CDs
4.) what percentage of MP3s/etc. came as digital files from Internet P2P setups, or from friends' hard drives, etc. - Ripping Parties, or "Distributed/Remote Backup Events" aren't exactly uncommon these days
Think about your own music collection - how much of it is either bought from iTunes or ripped from CDs you still presently own? More importantly, how much is NOT from one of those two categories?
The second alternative is for Apple to license its FairPlay DRM technology to current and future competitors with the goal of achieving interoperability between different company’s players and music stores. On the surface, this seems like a good idea since it might offer customers increased choice now and in the future. And Apple might benefit by charging a small licensing fee for its FairPlay DRM. However, when we look a bit deeper, problems begin to emerge. The most serious problem is that licensing a DRM involves disclosing some of its secrets to many people in many companies, and history tells us that inevitably these secrets will leak. The Internet has made such leaks far more damaging, since a single leak can be spread worldwide in less than a minute. Such leaks can rapidly result in software programs available as free downloads on the Internet which will disable the DRM protection so that formerly protected songs can be played on unauthorized players.
An equally serious problem is how to quickly repair the damage caused by such a leak. A successful repair will likely involve enhancing the music store software, the music jukebox software, and the software in the players with new secrets, then transferring this updated software into the tens (or hundreds) of millions of Macs, Windows PCs and players already in use. This must all be done quickly and in a very coordinated way. Such an undertaking is very difficult when just one company controls all of the pieces. It is near impossible if multiple companies control separate pieces of the puzzle, and all of them must quickly act in concert to repair the damage from a leak.
Apple has concluded that if it licenses FairPlay to others, it can no longer guarantee to protect the music it licenses from the big four music companies. Perhaps this same conclusion contributed to Microsoft’s recent decision to switch their emphasis from an “open” model of licensing their DRM to others to a “closed” model of offering a proprietary music store, proprietary jukebox software and proprietary players.
Steve definitely has a valid point that it'd be tough to force downstream sub-licensees to update quickly, and an even stronger point about keeping secrets * . Apple seems to keep secrets better than just about anybody in the high tech and entertainment industries, even though they are paid a vastly disproportionately high level of attention by those industries.
* (Witness the entire DeCSS scenario, all because a single DVD player manufacturer failed to properly encrypt The One Key - cat got out of the bag, never to return)
BUT...Steve does kind of forget to mention one other factor here - that by keeping it a closed economy, it guarantees that the songs you buy on iTunes ONLY work on iPods. And if you look at Apple's fiscal numbers, it is the iPods that are the source of profits, not the iTunes Store. It is a bit like a reverse razors and blades model - Apple wants you to buy pricey iPods (razors) so you can then buy fairly cheap, low margin songs (blades). The two drive each other synergistically, but the bottom line is, the iTunes Store was created to sell more iPods, because that's where the money is.
By omitting this factor, Steve diminishes the credibility of his point. A line about "Yes, I do have to admit this does steer folks towards buying iPods, but we do strongly feel, and the market stats back us up, that we have the most popular and successful music player out there." Something like that would keep him on the Straight and True. Skipping that statement makes my BS-O-Meter needle start to twitch.
The third alternative is to abolish DRMs entirely. Imagine a world where every online store sells DRM-free music encoded in open licensable formats. In such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players. This is clearly the best alternative for consumers, and Apple would embrace it in a heartbeat. If the big four music companies would license Apple their music without the requirement that it be protected with a DRM, we would switch to selling only DRM-free music on our iTunes store. Every iPod ever made will play this DRM-free music.
Hmm. Sounds interesting. And it makes sense - just use non-DRMed AAC, or even MP3s (which aren't as efficient, but open standards never are, sigh....)
Do go on...
Why would the big four music companies agree to let Apple and others distribute their music without using DRM systems to protect it? The simplest answer is because DRMs haven’t worked, and may never work, to halt music piracy. Though the big four music companies require that all their music sold online be protected with DRMs, these same music companies continue to sell billions of CDs a year which contain completely unprotected music. That’s right! No DRM system was ever developed for the CD, so all the music distributed on CDs can be easily uploaded to the Internet, then (illegally) downloaded and played on any computer or player.
While technically accurate, this argument isn't quite fair. To stop casual consumer piracy, you only need to make it obnoxious enough that most folks won't bother with it. To stop P2P piracy is...virtually impossible. CDs were invented at a time when 650 MB seemed an enormous amount of data, vastly beyond what any consumer would ever dream of working with. I recall working for a large international industrial design/interactive design shop, with 20+ people in our office, and only at ONE station was there a big enough hard drive to routinely burn CD images for client projects. My first hard drive was 600MB (smaller than a CD) and cost $1500. The labels had no idea how quickly storage would get big and cheap, and got burned, and HARD, by a cousin of Moore's Law. The studios saw that happen and decided to put DRM on their 5 inch plastic media discs, DVDs. And that didn't last long, as DeCSS hit the scene and it became cake to pick the DRM locks - because there was only one key in the universe, and once it was out, it was OUT. Prepping for the next round of discs, HD-DVD and Blu-ray, even more stringent DRM was applied...and it too was promptly broken.
1.) DRM will always, Always, ALWAYS be broken.
2.) If no DRM, casual copying will be pretty rampant - witness CDs, either straight out duped, or ripped and the files shared.
3.) If stringent DRM, casual copying will be limited (with varying degrees of success), but P2P copying, it is safe to say, will never be curtailed - DRM is trying to keep you from getting at content you are going to, that they want you to, that you paid to, see - so it HAS to be decoded at some point, and therein lies the hole to be breached or exploited. It only takes one kid in Norway (or Kansas, or wherever) to get around DRM on ONE copy of the work in question, and if he has broadband and P2P, the world will have it within hours. Such Is Life.
In any case, the unfair part is this: labels HAVE to sell CDs - it is the ubiquitous, wide installed base, industry standard format for distribution. Consumers haven't taken to the proposed next generation audio formats for higher quality audio - DVD-A and whatsitcalled (see? If I can't think of it offhand, what are the chances it'll be successful?).
So the labels sell CDs because frankly, they have no other choice. They HOPE, they'd LOVE, to migrate to a more secure distribution format such as DRMed digital downloads, but it takes time to shift, and frankly, consumers need to see a benefit. The convenience of "gimme now" is working, with over 2B iTunes tracks sold, although there are the hassles of backups, incompatibilities, etc.
Another way of saying it? The studios are trapped selling CDs, which get copied rampantly, and they hate it, and want out of that game - so DRM it is for ANY new form of distribution.
In 2006, under 2 billion DRM-protected songs were sold worldwide by online stores, while over 20 billion songs were sold completely DRM-free and unprotected on CDs by the music companies themselves. The music companies sell the vast majority of their music DRM-free, and show no signs of changing this behavior, since the overwhelming majority of their revenues depend on selling CDs which must play in CD players that support no DRM system.
...backing up my point just made about no choice but to sell CDs...
So if the music companies are selling over 90 percent of their music DRM-free, what benefits do they get from selling the remaining small percentage of their music encumbered with a DRM system?
It makes them feel better? A little bit less robbed? Knowing that stuff they sell has a lower chance of being ripped off, stolen, having benefit derived for which they receive no recompense?
There appear to be none.
If anything, the technical expertise and overhead required to create, operate and update a DRM system has limited the number of participants selling DRM protected music.
Clearly, and this entire argument is even moreso the case in the downloadable video market right now (more on that shortly). Witness the failure, or limited success, of many of the other music download stores out there. Apple, to their credit, does an excellent job of understanding the importance of ease-of-use, good interfaces, and as the owner of the entire soup-to-nuts process, can craft an integrated, well functioning whole...which has largely NOT been the case for other online music stores as far as I can tell. If you don't buy your music from iTunes, you're buying it from, uh...the fact that I have to pause more than a second typing to think of viable alternatives kind of proves my own point (at least to me, Apple fan that I am).
If such requirements were removed, the music industry might experience an influx of new companies willing to invest in innovative new stores and players. This can only be seen as a positive by the music companies.
OK, I'd put that on the map as a possibility.
Note the equation of his sentence is conditional on this, emphasis mine: "the music industry might experience an influx of new companies willing to invest in innovative new stores and players. This can only be seen as a positive by the music companies."
That is a bit like saying
"If A might be equal to B and we know B=C, then A could only be as good as C!"
If that doesn't make sense or make my point strongly enough, how about this:
"If a frog had wings, it wouldn't bump its ass a-hoppin'."
Steve plants a big "might be", then if you assume that is true, THEN makes a huge "can only be" leap. Shady math.
The math probably doesn't work for non-DRMed content right now anyway since downloads are such a tiny fraction of current incomes, CDs still sell well (if not as well as they used to), and it would be a tremendous hit for the industry to try to swing the majority of purchasers to online, plus the chaos to their distribution partners and the political chaos that would engender. Blah blah blah, you (hopefully) see where I'm going with that. The labels want to shift to a more secure format - DVD-A and CD-whatsit didn't take with the buying public, so downloads are the next attempt to shift to a secure format.
Much of the concern over DRM systems has arisen in European countries.
YES. Diverging politically for a moment, the countries that don't tolerate invasions of privacy to the level that the US does (atrociously) have a low tolerance for this kind of bull. They see BS, they call it BS and tend to not say "That BS is industry standard, so step in it and don't complain." Kudos to my overseas brothas and sistahs. Keep the faith.
Perhaps those unhappy with the current situation should redirect their energies towards persuading the music companies to sell their music DRM-free. For Europeans, two and a half of the big four music companies are located right in their backyard. The largest, Universal, is 100% owned by Vivendi, a French company. EMI is a British company, and Sony BMG is 50% owned by Bertelsmann, a German company. Convincing them to license their music to Apple and others DRM-free will create a truly interoperable music marketplace. Apple will embrace this wholeheartedly.
Nice job of saying "Please aim your weapons at those guys not me, I only work with them." But he DOES have a point.
It is a bit disingenuous to suggest that the labels go non-DRM with their content. Apple, as I stated, makes their money off the iPods, not the music. Yeah, they do make some profit margin off the music, but it ain't much, and it certainly is not (presently) their primary source of income. Note you see iTunes+iPod commercials, not just iTunes commercials.
This is a bit like Ford asking Shell to give discounts gasoline, stating "It'd be good for the economy." * yeah, well, Ford makes out like a bandit from this, but Shell carries all the burden and risks. It is entirely valid to make this request, but it isn't as "Hey buddy buddy!" and "It's all good, brother!" as it might appear on the surface.
(* - Robogeek points out in the comments that this isn't a truly valid analogy, because unlike Apple, Ford doesn't sell cars AND gas. But imagine if Ford sold SOME gas, this'd be closer to the situation...maybe if they sold "for Ford only" gas debit cards....or something or other...mumble mumble...)
It IS good PR for Apple to make this request - it makes them look like they're on Our Side (and I think they are on this issue). However, note they've waited until now to go public with the issue - if Apple's market share for digital music players were not as strong, I don't think we'd have seen these statements made. Apple is now firmly entrenched enough as a market leader that it poses little risk for them to suggest getting rid of DRM. If they get it, they'll still sell plenty of iPods, it isn't as if there are major competitors to them. iTunes, even ignoring the whole Store end of it, is the best music organizer/player I'm aware of on the market. And it is free to boot - so Apple's position there is pretty safe. But I think the major labels are unlikely to do as Steve suggests, so even that risk is ameliorated - not much skin off their back in the unlikely event the labels do acquiesce, so a win/win to suggest this plan of action.
And if the Big Four DID sell un-DRM'd downloads, they'd be even easier to distribute and share - the already marginal barriers to entry (difficulty/effort) to file sharing, be it P2P or person to person, would be lifted - "Hey, I got this file, let me email it to you!" or even easier, imagine being on iChat/Yahoo/Messenger: "Hey man, got the new David Byrne music, here it comes, click on "Accept file" and its yours." If your friend asked, would you NOT hand it over?
So while I'm no fan of the Big Four, and they do utterly hoserate a lot of their clients, not to mention the buying public in myriad ways, I can't say I entirely defend Steve's memo here.
It isn't that Steve's comments are inaccurate, just incomplete.
In the end, if the Big Four did open wide and let it all go out unDRMed, I think the net result would be a slight increase in people's willingness to buy music if they could use it freely, but a LOT more sharing would go on. And in the end, Apple wouldn't care too much about that, becuase it would probably mean more iPods to be sold.
And in the end, that is what Apple really cares about.
OH - all that being said, proprietary, device limiting DRM needs to go away in our future digital world - witness the craziness of the Blu-ray/HD-DVD fiasco that (among other reasons) is holding back high def DVD's future. Proprietary solutions are always how things start in technologically difficult fields, but over time, either one proprietary solution is picked as a standard, or everyone gets fed up enough that the industry gets it together enough to come up with a standard (witness CDs, DVDs, and if they'd just stuck with ONE high def DVD solution!)
PS - OK, now Part 2: Movies
Now apply this whole bolus of thought to movies and it gets worse - since music is something you can appreciate on the go, it is a different animal that video - you can listen to music while you walk/talk/jog/work/ride the bus, but good luck doing any of those with video. Audio is an augmentative experience onto reality, video tends to be an immersive/dominating one - it is tough to do anything else while watching video. Plus audio is technically easier than video - portable audio is cake and cheap, portable video is not.
With audio content, getting it onto an iPod to tote around and plug into better presentation devices isn't difficult. While the video iPod is the first step in that direction, it has a long way to go in terms of storage, battery life, and most especially presentation quality.
DVDs are a half-inch away from being non-DRMed - how to strip the thin veneer of CSS was mastered and shared long ago, and anyone with 20 free minutes and Google can figure out how to rip a DVD - I have more a few acquaintances that use Netflix as a "Rent, Rip, & Return" service, ending up with a high quality H.264 file living on their hard drives (or iPods). This definitely impacts the number of DVDs they buy.
DVDs are defacto barely or non-DRMed - I'd be very curious to know the percentage of average consumers that know how to get around it. The good thing about DVDs is that playback is largely ubiquitous (sorry Linux guys) - the vast majority of us have access to a simple/low cost way to play them back.
How much does CSS keep people from copying/ripping DVDs? I'd guess not much - between the largish file size * and once-only viewing habits, I'd say the majority of folks wouldn't copy DVDs if it were one button easy - takes too long, too much effort, just rent it for $4 anyway.
* public perception of storage costs lags waaaaaaaay behind reality - saw 500GB drives for $140 online this week, that's at LEAST 55 ripped DVDs right there
There is definitely a crucial bit of economic math relating the value of a digital product, the price, the ease of copying it, and the likelihood of it getting copied. Anybody got an equation on that documented? I'd love to see it.
In that equation, music is clearly a likelier target for copying than video. But as video gets easier to copy, the likelihood increases.
OK, that's enough for now, time to go eat, I just wrote most of this in one long rambling screed * after getting back from a run.
Thanks to the half a dozen folks who emailed me the link today - I saw, I saw! Just took some time to read, digest, and get time to comment on it.
-mike, finally done
* - apparently, "screed" is my Word Of The Day
YES I like Apple toys, AND I have an AppleTV on order, AND I have bought 3 or 4 iPods for myself and family, AND I own some Apple stock, AND I have 6 Macs in my house, AND I could do more analysis/research on the music downloading scene, AND I want to see Apple come out on top because I like them and their toys, AND I've been in a cynical/curmudgeonly mood of late. All that said, I think this is a fair analysis/interpretation of the situation. But of course, as Dennis Miller says, I Could Be Wrong. Think so? Please Comment away using the link below.
After some more thought, Option 2 (licensing FairPlay to others) actually makes more sense - SOME DRM is necessary to protect rampant illegal file sharing. But any industry wide DRM standard is going to require some DRM. And it WILL get broken - witness, hmm, let's see...oh! Every DRM ever implemented. If there is going to be interoperability, it will require some DRM. Maybe even supporting multiple DRMs under an umbrella - could be iTunes or Zune or whoever else joins the consortium. But that opens whole other cans of worms.
I wish the music guys would learn from lesson industries that have already been through this...like software. Software has varying levels of DRM depending on how badly they want to protect their content, usually the higher priced the software the tighter the DRM. Freeware? No restrictions, copy it around. Simple "keep honest folks honest" serial numbers work pretty well. For high value software, the industry tried hardware dongles - little pieces of hardware that you needed one of for each high end app (I still have a half a dozen rolling around in a drawer, unused) - the software wouldn't run without it attached. Well guess what? The software often wouldn't run, or would stop running, even with it attached. The bigger the company involved, the more rapidly they abandoned this approach, since it was more trouble than it was worth. Many legit software owners would run the illegal cracked versions...because they ran more stably (ElectricImage, anyone?). Adobe used to use hardware dongles on After Effects Pro, they gave up. Now the industry tends to use software that locks to a given user account or a given machine - and that has troubles, witness Microsoft's validation woes. And these for for individual applications or operating systems costing hundreds or thousands of dollars. Think of the hassle and difficulty involved in supporting that. Now apply that to a song you want to buy for a dollar or two. Youd better have a 99.99999% accurate and easy metholodogy for dealing with that. And there's no such thing.
CSS was a group consensus effort to use DRM for DVDs. It MOSTLY has worked - MOST consumers don't consider it worth the trouble to dupe or distribute DVDs. Some do. Blu-ray and HD-DVD have much more restrictive and advanced DRM, it has already been broken, but we'll still have to deal with all the hassles sure to follow from it.
Where does this leave us? If there is to be interoperability, either somebody licenses their industry leading standard to everyone else (and here's looking at you, Apple), or the industry comes up with a new standard they can all agree on (that'll take 3 years right there).
And if DRM is used, and the standards do go that way, then we'd likely still be stuck with some of the original snafus - can I sell my copy to someone else as I would a DVD? What if I want to play my movie I bought at my girlfriend's house? Or my buddy with the big badass home theater setup with our friends on a Saturday night? Etc.
DRM still sucks. Does and will suck.
Do I sound like I'm flip flopping? We need it, it sucks and we should get rid of it? Yes, I am. How does the industry get some/reasonable protection from rampant file sharing (sneakernet, friendnet, P2P, whatever), yet give consumers the kind of freedom they get with their physical media to move it around etc.?
A billion dollars to the company that solves (and manages to hold onto the rights) to that one...
John Gruber chimes in with his as usual excellent observations:
Daring Fireball: Reading Between the Lines of Steve Jobs's 'Thoughts on Music', leading off with:
Is it a challenge to the major record labels? An answer to the increasingly hostile European governments (Norway, France, Germany) that are pressuring Apple to “open up” the iTunes Store? A message to the press to clarify Apple’s stance on DRM? A big fuck-you to Microsoft?
It is all of these things.
...and nails it more concisely than I do. Andrew Shebanow calls video "the elephant in the room"
He also has a titled called "Killing DRM would kill subscription services" and I didn't even think of that angle. He also has a great reaction to the industry wanting control over the DRM others use:
In other words, the music industry wants a magical DRM format that gives them — not Apple, not Microsoft — complete control over all digital music. And a unicorn and a rainbow.
AppleInsider's coverage gives me some numbers to use as ammo to defend my razors/blades statement: "'The reason for this is that iPods are significantly more profitable to Apple than iTunes; iPod (35 percent of sales) gross margins are in the 30 percent range while iTunes (5 percent of sales) gross margins are in the 5 percent-10 percent range,' he wrote." - so yeah, Apple cares MUCH more about iPod sales than iTunes Store sales.
NYTimes chimes in - Jobs Calls for End to Music Copy Protection - New York Times
So sue me � Blog Archive
� Steve%u2019s misleading statistics: "if you%u2019ve bought 100 songs ($99), 10 TV-shows ($19.90) and 5 movies ($49.95), you%u2019ll think twice about upgrading to a non-Apple portable player or set-top box. In effect, it%u2019s the customers who would be the most valuable to an Apple competitor that get locked in. The kind of customers who would spend $300 on a set-top box."
....and if DRM goes away, no subscription models could survive...and Apple doesn't do a subscription model - a bit of a "Sucks to be you" to the subscription based services
1) sell a quality product at a price that's right. Nobody is doing this yet. Make it easy to buy and work on anything you want to use it on. That means no to DRM.
2) Doing 1) above takes away ALL the excuses, and all the limitations that make the pirate copy have more "worth" to the user than a legit one. Now you have to make copyright theft socially unnaceptable, just as it wasn't the breathalizer that stopped drunk driving, it was the sheer social unnaceptability of drinking then driving that did it.
It's not an easy solution, but you've got to treat your customers with respect if you expect them to buy your product. Otherwise, it's an endless battle of DRM v Hackers, where it can only be the hackers that win, and then everyone looses.
(Though these days they're hardly even doing that.)
However, your underlying point is correct in that Apple has no real economic risk exposure if the labels switch to non-DRM online music licensing ("sales") - the labels do, although said risk is largely perceived/hypothetical. (I love how Steve points out that 90% of music sales are already DRM-free CDs.)
Bottom line, it is in Apple's strategic interest to shift the marketplace away from CD sales to digital online sales of music (especially as it would set a precedent for movies/tv), as that both a.) increases iTunes' market dominance, and b.) pushes more iPod sales - which is where/how Apple generates the majority of their revenue in this space anyway. (Though it would also obviously increase the economic significance of their content sales.)
Concurrently, it also just happens to be in consumers' best interest for DRM to go the way of the Dodo.
Since Apple upgraded the resolution of their video downloads for sale (and inevitably will again to HD at some point), I am increasingly impatient for them to sell music in a lossless format - even if it were at a small, relative premium. (Maybe this is how we'll get the remastered Beatles catalog later this year, now that the Apple Corps lawsuit's been settled? I can dream!)
"Price that's right" is hard to establish - what if the ease of copying makes the "worth to buy" price so low that it is economically unfeasible for the producer?
That ties directly into your point about social mores - and that also faces its own "Town Common" problem - it is every content producer's problem, but no individual producer's problem to fix - so everyone is reluctant to solve except through group advocacy, which companies grudgingly ante up for.
But by making content theft socially unacceptable, that's the long term solution (and that'll take a looooong time to convince the American Cowboy ethos to let go of "If they can't catch me, it's OK." or "They're A-holes anyway, let's hose'em back.")
How to do that, with credibilty and believability, will be tough - all those commercials about the gaffer who suffers, I call shenanigans - it is the rich producer who more likely suffers at first. LATER the gaffer suffers, when future projects aren't greenlit because they are seen as economically non-viable.
Anyway, cross that with the flagrant talent-hosing practices of studios and labels, and it is an uphill battle, and the small indie content producers suffer as well.
Your comment about respect is also true - but it'll be hard to get that from labels/studios I feel, and it'll take time for consumers to come around to respect back, even if given in the first place (did that make sense?).
Hackers win=everybody loses....but the majority of folks don't understand it that way. Regardless of the veracity of that statement, people don't see it that way.
Not trying to argue with the VALIDITY of your statements, just the difficulty of putting them into action.
And I forgot to say it is in consumers' interest for DRM to go away, need to amend article...
I agree with Graeme - the quality and price should be right (and at the moment it's a rip-off). If the music industry were allowing 96khz lossless files to be sold for $0.99, or compressed AAC ones for $0.50, I think they would regain some consumer trust and also shame a lot of people out of piracy ;)
We all have our price - I would happily accept DRM if it meant that I got to listen to lots of great cheap, high-quality music. But the more restrictive the DRM, the cheaper and higher-quality the music should be. I don't mind buying 5 copies of a song for my iPod, computer, car, cellphone, if they cost $0.10 a pop....
I would also consent to watermarked, traceable downloads (eg where the song I download is subtly different to the same song downloaded by someone else, so they can track who uploaded it to a P2P site), IF they made it worth my while - eg very cheap, high quality, mobile from device to device.
Maybe Steve will scare the recording industry into offering us a better deal. Here's hoping. Until then, I agree Mike, I'm fine with CDs...
Of course, the other way is for the record labels to seed the music on the P2P networks themselves... but with product placement in lyrics and subliminal sounds of a Pepsi bein opened inserted into every orchestral crescendo...
I am still writing my script for a product placement-driven feature film that will be financed using a similar method ;D
Lets try something more constructive like maybe having isp's place a very small fee on our bills that would directly go to to the companies that are directly impacted by theft.
Even w/o DRM, digital audio formats are a mess... so many different formats+flavors. I'd like to think that in 5+ yrs evetrything will converge, but looks like things only get more comlicated. I can't imagine a solution yet.
I do think there is a subtle flaw/simplification in your statement in your "OH," post signature. Not (certainly) in your assertion that "device-limiting DRM needs to go away," (I agree) but in the slightly breezy way you mention that.
I believe that was exactly the point Steve was making with regard to secrets beyond one company -- making your DRM non-proprietary means spreading your secrets too wide, thus watering down your technical ability to protect the content.
In order to have "good" (i.e. secure) DRM (not that *I* believe any DRM is good, mind you, ahem), there appears to be some difficulty in making said DRM an "open standard." This fallacy/catch-22 is mostly why no DRM at all would be a superior choice for Apple. The wider the DRM, the faster it's broken.
Actually, part of me also wants to believe that this speech from Steve is really just a core belief thing... After all, this is "Rip. Mix. Burn." Apple; champion of the little guy, enabler of mix-ups and mash-ups and a DIY digital world. Enabler of the creative wannabe Mom and Pop Artist-At-Home. I've felt for a long time like FairPlay and DRM ran fundamentally counter to Apple's founding principals...
That said, of course it was also the key to getting the door open for Apple and digital music. Access to the treasured goods was a crucial step to making the iPod the #1 stocking stuffer. A necessary evil.
Now, lately, perhaps there is enough discussion among consumers -- enough rumblings from EU governments, enough bad press from Sony rootkits, enough clamor for better/easier/cheaper... Now is a natural time for Apple to once again side with the consumer and hope that logic and public opinion can win out. At the very least, it shields Apple from being the target of any directed (legal) attacks on DRM itself. Passes the bucks back to the labels (and the studios), where it rightfully belongs. And makes the most obvious connection it can -- that the main product the labels sell, CDs, do not require DRM to be successful.
Of course only enough outrage from consumers will possible have any effect on DRM -- either legally via government (unlikely) or hopefully eventualy from someone within the Big 4/Hollywood who finally has the lightbulb moment and realizes this new VCR thingy is a whole new business to exploit rather than fight. And that DRM doesn't actually stop piracy.
I agree with most of your breakdown; Steve's comments are certainly incomplete. But I'd like to think -- in addition to serving Apple's ultimate best interests -- he's really just saying what he thinks is right.
Yes, they're between a rock and hard place. Tough.
Software doesn't make the best analogy to media sales, due to software being something you use, rather than just passively consume, but the story of the failure of dongles is a very good one to know and learn.
Remember, the best DRM is having a product so crap that nobody wants it :-)
Software cannot fix social issues, the same way you can't effectively legislate behavior.
DVDs are a half-inch away from being non-DRMed ... I have more a few acquaintances that use Netflix as a "Rent, Rip, & Return" service, ending up with a high quality H.264 file living on their hard drives (or iPods). This definitely impacts the number of DVDs they buy.
How much does CSS keep people from copying/ripping DVDs? I'd guess not much - between the largish file size * and once-only viewing habits, I'd say the majority of folks wouldn't copy DVDs if it were one button easy - takes too long, too much effort, just rent it for $4 anyway.
* public perception of storage costs lags waaaaaaaay behind reality - saw 500GB drives for $140 online this week, that's at LEAST 55 ripped DVDs right there
I also know people who use DVD rentals (not Netflix) as 3R service- but then, they collect and amass so much material that they do not watch it. They only bought what they watched, but now they "collect" more than they could ever sit and watch in their spare time. In effect- "collecting" hasn't affected their _purchasing_ very much. In fact, they still _purchase_ those disks and sets that offer additional material- something most online distros do _not_ offer.
Movies and video are not music. Most people do not _passively_ take in movies all day long anywhere near the way people wake up to music, listen to it in the car, while working, exercising, and putzing around the house. Video content must be deliberately enjoyed by _not_ doing other things.
There is only so much time to _not_ do other things unless you don't have a job, in whcih case, you're not buying 5 DVD's a day anyway. But those are a portion of the people who download a lot of content because they have time to actually watch it. The rest download it to _collect_ it. The question is, would they have collected as many retail DVD's if there was no P2P? No. They wouldn't. They collect what is easily collected.
The only collectors who spend a lot of money on their collections are those who have a lot of money and they don't need to go to the trouble to P2P to get an image of a movie that lacks all packaging, extra materials, and is more heavily compressed than a DVD, let alone an HD DVD. If they have the money, they want the best product and that is retail.
I haven't mentioned DRM because - with, or without it - I think the consumers are the same. DRM won't stop collectors. DRM will annoy legitimate users in certain instances. DRM costs time and money to invent, implement, update, maintain, and more. Costs that could have been returned to the bottom line.
It's funny that the music download costs are on-par with an uncompressed (per se) CD yet the quality is lower and there is no physical manufacturing, materials, distribution and more. Costs should be lower but they are not.
It's funny that the movie downloads costs are actually higher (so far) than a comparable DVD and offer less quality, less content, less usability, and _still_ have no costs for physical manufacturing, materials, distribution and more. Costs should be lower, but they're not.
In the end, DRM exists because the companies want to restrict the media as tightly as possible so they can extract as much money as possible for a given bit of media, as often as possible. It's not about protection at all. It's about them making _more_ money off content than ever before by making consumers pay, and pay, and pay.
You hit all the points to prove that DRM should be abolished, but in the end you come to a different conclusion, that perhaps some standard DRM should be hammered out.
The points (well made) were that every DRM (for music, video, and forms of software protection) has failed and will continue to fail. In addition, most caused unintended negative consequences to ease of use along the way.
The conclusion I draw from this is that all companies that deal in all these forms of media should abandon DRM altogether. Why continue with failing strategies that hurt the consumer and also have numerous other costs of their own?
As you say, piracy will always exist to some extenet. Yet, I believe that very few people desire to do anything illegal if they can help it. I hope I'm not too optimistic in thinking that way. If the product is easy to obtain and use legally, few will resort to piracy, regardless of how easy it is.
The right product at the right price with no impediments. Trust that anything lost to piracy is made back in volume for a good product.
And YES, would require all new shiznit.
That's the best I can think of, not saying doable/easy/workable.
It'a bit like if your blue shoes wouldn't go on your feet without wearing the right belt - "Laces will not secure until matching belt is worn." or somesuch...irritating as &^(%*#$(%*#$....
...so what do we do if digital copying is soooooo easy?
I'm heading more and more towards Graeme's side - you have to change attitudes if you want all the benefits of no DRM.
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