DRM Promotes Piracy

Behavior modification is difficult and I know this from personal experience. As a child my stepmother had a way to deal with lying that was probably very effective. If you were caught you got a tablespoon of raw Tabasco Sauce. In my own case I drank a lot of Tabasco Sauce, unfortunately every time I got it I was telling the truth which did not lead to a particularly warm relationship with my stepmother.

By continually punishing legal buyers of media with increasingly restrictive DRM components on their media it is my belief that the media organizations are effectively training their legal buyers to behave illegally. iTunes downloads have slowed dramatically and the other legal music services continue to struggle to make profitability. DVD sales have slowed as well and it is my contention that it is the hostile acts of the media industry that is actually driving these trends.

If I grow to dislike and distrust the companies I buy from, Sony BMG being the strongest example, but still want to listen or watch what they offer isn't it more likely that I'll refuse to buy from them and seek alternative sources? There are legal sources for this media on cable and radio, and illegal sources on the internet, that bypass the retail channel and get me what I want, without unwanted restrictions.

Think about it, if your local car dealer put a gadget in every car he sold that forced you do drive no more then 45 miles an hour, reported every move you made, and made sure you couldn't go on long drives over the weekend wouldn't you buy from someone else or look for someone to take the offending "gadget" out of your car?

DRM: Shifting Profit Away From the Artists

If you think about it what DRM actually does is shift profit away from the artists and put it in the hands of those that can figure out ways, legally and illegally, to get around the DRM. This is increasingly where the value will aggregate as you will have to benefit from the efforts of one of these intermediaries before you can get to the media. Take Apple, which arguably does the best job of providing a seamless experience (providing you are using all of their products). Apple's profits are up sharply largely due to a massive increase in iPod sales. Now compare this to the languishing media industry which appears to be drifting towards unprofitability and you'd have to be blind to miss where the margins are going.

Apple assures the experience and provides a way to get enjoyment either despite or without DRM. Sony, their competitor, who embraced DRM to the extreme, has been roundly thrashed by Apple in the market.

Despite the whining by the media industry that piracy is the cause of their problems it appears to me that they have only to look in the mirror to find the real cause and, personally, I think if they addressed that cause and focused back on providing strong value they would see revenue and profit improvements.

If the media industry wants to be brain dead stupid it is up to us to protect ourselves and not suffer along with them. In short it is time to fight back.

Fighting Back

Here is my advice. If the product you want to buy has restrictions on it preventing you from doing what you want to do, don't buy it. Rather then purchasing your music on iTunes or any other on-line service, go to a music Starbucks and buy it there. There is no DRM on their disks and you can move that music to any device you own. Rather then buying a DVD (which I stopped doing some time ago) get a PVR with a DVD recorder. Once recorded these movies are also more portable and flexible. You can also try one of the subscription services, these have DRM but you get access to all of the music and movies which can then be moved to a larger variety of platforms, if you aren't happy, cancel the service and you won't be stuck with anything you are disappointed with.

In the end my hope is the media industry will change focus and go after the criminals rather than turning us all into ex-customers and eliminating much of their own profit. But if that is the way they want to go, I think it is our duty to make the path as difficult as possible.

Rob Enderle is the president and principal analyst of the Enderle Group and focuses on emerging personal technology for both the corporate and consumer markets. Rob sits on nine industry advisory councils, has a passion for online gaming, and still builds many of the PCs he uses.