Microsoft Research DRM talk
By Cory Doctorow
5. DRM is a bad business-move for MSFT
When Sony brought out the VCR, it made a record player that could play Hollywood’s records, even if Hollywood didn’t like the idea. The industries that grew up on the back of the VCR – movie rentals, home taping, camcorders, even Bar Mitzvah videographers – made billions for Sony and its cohort.
That was good business – even if Sony lost the Betamax-VHS format wars, the money on the world-with-VCRs table was enough to make up for it.
But then Sony acquired a relatively tiny entertainment company and it started to massively screw up. When MP3 rolled around and Sony’s walkman customers were clamoring for a solid-state MP3 player, Sony let its music business-unit run its show: instead of making a high-capacity MP3 walkman, Sony shipped its Music Clips, low-capacity devices that played brain-damaged DRM formats like Real and OpenMG. They spent good money engineering “features" into these devices that kept their customers from freely moving their music back and forth between their devices. Customers stayed away in droves.
Today, Sony is dead in the water when it comes to walkmen. The market leaders are poky Singaporean outfits like Creative Labs – the kind of company that Sony used to crush like a bug, back before it got borged by its entertainment unit – and PC companies like Apple.
That’s because Sony shipped a product that there was no market demand for. No Sony customer woke up one morning and said, “Damn, I wish Sony would devote some expensive engineering effort in order that I may do less with my music.” Presented with an alternative, Sony’s customers enthusiastically jumped ship.
The same thing happened to a lot of people I know who used to rip their CDs to WMA. You guys sold them software that produced smaller, better-sounding rips that the MP3 rippers, but you also fixed it so that the songs you ripped were device-locked to their PCs. What that meant is that when they backed up their music to another hard-drive and reinstalled their OS (something that the spyware and malware wars has made more common than ever), they discovered that after they restored their music that they could no longer play it. The player saw the new OS as a different machine, and locked them out of their own music.
There is no market demand for this “feature.” None of your customers want you to make expensive modifications to your products that make backing up and restoring even harder. And there is no moment when your customers will be less forgiving than the moment that they are recovering from catastrophic technology failures.
I speak from experience. Because I buy a new Powerbook every ten months, and because I always order the new models the day they’re announced, I get a lot of lemons from Apple. That means that I hit Apple’s three-iTunes-authorized-computers limit pretty early on and found myself unable to play the hundreds of dollars’ worth of iTunes songs I’d bought because one of my authorized machines was a lemon that Apple had broken up for parts, one was in the shop getting fixed by Apple, and one was my mom’s computer, 3,000 miles away in Toronto.
If I had been a less good customer for Apple’s hardware, I would have been fine. If I had been a less enthusiastic evangelist for Apple’s products – if I hadn’t shown my mom how iTunes Music Store worked – I would have been fine. If I hadn’t bought so much iTunes music that burning it to CD and re-ripping it and re-keying all my metadata was too daunting a task to consider, I would have been fine.
As it was Apple rewarded my trust, evangelism and out-of-control spending by treating me like a crook and locking me out of my own music, at a time when my Powerbook was in the shop – i.e., at a time when I was hardly disposed to feel charitable to Apple.
I’m an edge case here, but I’m a leading edge case. If Apple succeeds in its business plans, it will only be a matter of time until even average customers have upgraded enough hardware and bought enough music to end up where I am.
You know what I would totally buy? A record player that let me play everybody’s records. Right now, the closest I can come to that is an open source app called VLC, but it’s clunky and buggy and it didn’t come pre-installed on my computer.
Sony didn’t make a Betamax that only played the movies that Hollywood was willing to permit – Hollywood asked them to do it, they proposed an early, analog broadcast flag that VCRs could hunt for and respond to by disabling recording. Sony ignored them and made the product they thought their customers wanted.
I’m a Microsoft customer. Like millions of other Microsoft customers, I want a player that plays anything I throw at it, and I think that you are just the company to give it to me.
Yes, this would violate copyright law as it stands, but Microsoft has been making tools of piracy that change copyright law for decades now. Outlook, Exchange and MSN are tools that abet widescale digital infringement.
More significantly, IIS and your caching proxies all make and serve copies of documents without their authors’ consent, something that, if it is legal today, is only legal because companies like Microsoft went ahead and did it and dared lawmakers to prosecute.
Microsoft stood up for its customers and for progress, and won so decisively that most people never even realized that there was a fight.
Do it again! This is a company that looks the world’s roughest, toughest anti-trust regulators in the eye and laughs. Compared to anti-trust people, copyright lawmakers are pantywaists. You can take them with your arm behind your back.
In Siva Vaidhyanathan’s book The Anarchist in the Library, he talks about why the studios are so blind to their customers’ desires. It’s because people like you and me spent the 80s and the 90s telling them bad science fiction stories about impossible DRM technology that would let them charge a small sum of money every time someone looked at a movie – want to fast-forward? That feature costs another penny. Pausing is two cents an hour. The mute button will cost you a quarter.
When Mako Analysis issued their report last month advising phone companies to stop supporting Symbian phones, they were just writing the latest installment in this story. Mako says that phones like my P900, which can play MP3s as ringtones, are bad for the cellphone economy, because it’ll put the extortionate ringtone sellers out of business. What Mako is saying is that just because you bought the CD doesn’t mean that you should expect to have the ability to listen to it on your MP3 player, and just because it plays on your MP3 player is no reason to expect it to run as a ringtone. I wonder how they feel about alarm clocks that will play a CD to wake you up in the morning? Is that strangling the nascent “alarm tone” market?
The phone companies’ customers want Symbian phones and for now, at least, the phone companies understand that if they don’t sell them, someone else will.
The market opportunity for a truly capable devices is enormous. There’s a company out there charging $30,000 for a $600 DVD jukebox – go and eat their lunch! Steve Jobs isn’t going to do it: he’s off at the D conference telling studio execs not to release hi-def movies until they’re sure no one will make a hi-def DVD burner that works with a PC.
Maybe they won’t buy into his BS, but they’re also not much interested in what you have to sell. At the Broadcast Protection Discussion Group meetings where the Broadcast Flag was hammered out, the studios’ position was, “We’ll take anyone’s DRM except Microsoft’s and Philips’.” When I met with UK broadcast wonks about the European version of the Broadcast Flag underway at the Digital Video Broadcasters’ forum, they told me, “Well, it’s different in Europe: mostly they’re worried that some American company like Microsoft will get their claws into European television.”
American film studios didn’t want the Japanese electronics companies to get a piece of the movie pie, so they fought the VCR. Today, everyone who makes movies agrees that they don’t want to let you guys get between them and their customers.
Sony didn’t get permission. Neither should you. Go build the record player that can play everyone’s records.
Because if you don’t do it, someone else will.
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