[bill_mchale]

Originally Posted by Steve Jordan

That's it in a nutshell: DRM is not, in itself, bad. It is many of its variants that are upsetting customers.

But customers have to accept some responsibility for the situation, too. We actually put up with equally restrictive rules tied to other purchases. But because the world continues to hang onto the Wild West mentality of the present web, many of us resist even the lightest security steps as "attacks to personal and global Freedom." Thus, DRM in all its forms is automatically labeled EVIL and hung without a trial, and the web townsfolk dutifully come out and throw rotten fruit at it.

With respect Steve, your definition of DRM seems to be at odds with the definition that everyone else uses. As far as I am concerned, the best DRM I have seen (ereader's), and the best that I can conceive of that still meets the definition of DRM, is still restrictive of basic fair use rights. I know you disagree with this, but as far as I am concerned, anything that can be done with a physical book should be possible with an electronic book and that includes either the resale and/or giving the book away (and it should be doable in a way where the transaction is not tracked by a third party).

Regarding the "Wild West" mentality; I would submit that the evidence I have seen over the last few years is that the Web has been exploited by governments and companies to get far more information on us than they have ever had before. Now granted, some of that is due to people posting on forums like this one and as such, one should not really have much of an expectation of privacy. However, others are far more subtle. As the consumer economy has transitioned from a Brick and Mortar/Cash based economy to a web/electronic payment economy, corporations now have an unprecedented level of information regarding our activities. Companies will even embed, into software they sell us, monitoring software that reports on some of our activities.

Now of course we have DRM which in all of its guises fundamentally undermines the concept of fair use.

My impression is that you consider it paranoid to worry about loss of freedom on the internet. My belief is that way too many take these concerns way too lightly.

It's because of this Wild West mentality that businesses have so little hard data to use when figuring web-based loss and developing security systems. Due to customers' adamant desire for privacy and unlimited access, there is often no way to collect useful data on transactions. So businesses, which base all of their operations on accurate sales, expenses and net profit data, only know that there are sales when they are looking, and losses when they turn their backs, and no way of knowing exactly who or how much of either.

With respect Steve, businesses know exactly how many sales they have made and these days almost certainly who they have sold to. Any ebook websites that permit customers to download books multiple times proves that. I can assure you, Amazon has a record of every book, dvd, CD, etc. that I have purchased from them in the last dozen years.

I agree, the basic problem with electronic media is that it is usually impossible to know how much loss you have; but not because thieves are stealing it from your servers; rather it is because people are taking legitimately bought copies and converting them into DRM free works which are then uploaded to servers for others to download. No reasonable or even unreasonable system of DRM is going to stop that.

A more secure web could get that data, and businesses could make more informed decisions. Without security, businesses are basically putting their wares out at night, turning the lights off and hoping there's money left on the counter when the products are gone in the morning. In that light, it's no wonder that businesses over-react by placing restrictive rules on purchases.

I don't know how businesses are supposed to make rational decisions about anything without data. They can guess, and they can blindly trust customers not to take advantage of them. But human nature has shown that people rarely pass up an easy chance to take something they don't have to pay for, so that trust only goes so far.

And yet, the most successful example of ePublishing has been Baen; and they sell their works without DRM. I even have heard it claimed that fewer people pirate their works. I am not sure whether that is true or not. But I know they have more sales.

Its also interesting that Amazon's DRM free MP3 business is one of the faster growing commercial MP3 download sites on the web.

Now maybe there is more piracy of these DRM free works, or maybe there isn't, but in the end, they are making more money than their DRM'd competitors (iTunes excepted.. but even it is trying to move to a more DRM free business model).

Businesses have to at least be prepared to take some preventive steps to make sure stealing isn't easier than buying. But they also have to know when the steps they are taking are too much... placing a bear-trap at the candy-counter to stop $20 worth of lost sales a month, which most people would consider a bit extreme...

Ultimately, the problem is that their losses are not coming at the Storefront. Very few pirated works come from works that have not been sold (i.e. hacking into their systems). DRM is essentially like having a person from the candy-counter follow you home to make sure eat the candy the way they want you to.

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Bill