At the O’Reilly conference Kirk Biglione of Medialoper presented a very lively seminar on DRM. He started out by discussing what he felt were the music industry’s mistakes in their own approach to DRM. I thought they were interesting enough to share with you. The following are the 6 major mistakes Kirk felt that the music industry made:
1. Caught by surprise: the industry had no idea that file sharing would become an issue and had no plans to deal with it when it appeared:
2. Mistook consumer demand for piracy: The developement of MP3 resulted in the greatly enhanced ability of the consumer to listen to music in all sorts of different environments. This generated a huge new demand for music and resulted in the rise of file sharing networks and the creation of a new kind of pirate – one whose motive was not profit, but was social in nature, that is the sharing of files conferred status. The industry failed to realize this and reacted as if the file sharers were purely out to make, or save a buck.
3. The industry failed to develop/offer a viable legal alternative to file sharing
4. The industry declared war on the MP3 format – a format that consumers wanted.
5. Litigation as a business model set sales back to what they were 15 years ago. I’m sorry I didn’t record the data on the charts he presented.
6. The industry assumed that DRM must be the solution and didn’t investigate alternatives.
He said more, but one point he made over and over again, was that in the age we are living in the consumer feels entitled to get what he wants and that if he is thwarted he will find a way to get it, no matter what the provider does to prevent him from doing so.
He then mentioned what he called 3 myths of DRM:
1. DRM prevents piracy. He asserted that in actual fact it makes no impact at all.
2. DRM enables a marketplace for digital content. In actual fact is suppresses the marketplace.
3. DRM-free = $ free. He stated that in fact eMusic, iTunes and Amazon are offering DRM-free music and pointed out that 50% of Fictionwise’s sales are of DRM-free ebooks.
