EMI, Apple, DRM and…Books!

April 4th, 2007 · 5 Comments
by Kassia Krozser

BS Headquarters (also home to Medialoper HQ) has been buzzing with the news that EMI has struck a deal with Apple to sell DRM-free music via the iTunes store. While this is not the unprecedented move some media would have you think — Kirk notes that labels have being doing this via eMusic for many years, it’s an interesting acknowledgment that DRM is not the bee’s knees.

EMI made a bold choice, given the pressure from industry peers to stand arm and arm with DRM.

At its core, Digital Rights Management (“DRM”) is very simple: sell product to consumers while protecting the intellectual property. In theory, this is a good thing; nobody wins when people steal. In practice, DRM has done more than alienate consumers, it’s lead to lawsuits
The problem with the way DRM is implemented is it is often so restrictive that consumers feel compelled to work around the restrictions in order to consume media they way they want. Let us make up an example (because we are sure this would not happen in real life): a publisher releases a book in digital format that can only be read on special software downloaded from a particular vendor. That special software only works on the Windows operating system because, well, everyone knows that real readers use Windows. The software cannot be copied to a CD or backed up anywhere else, which is a shame because the lack of a backup was a real bummer when the customer’s hard drive crashed. The vendor’s terms of service are very clear: no refunds, even though we stopped you from making a copy. Buy another one!

Sadly, that’s not an extreme example. It’s not even an improbable example. In fact, we suspect we could, given a few minutes, find real life examples in at least one of the four major entertainment sectors, right not to the “no copy even for backup purposes” clause. It’s kind of sad when our wildest imaginings barely begin to scrape the surface of reality.

DRM has lead to an unusual situation where software is limited to specific hardware for playback. Physical books, most of you will recall, can be taken anywhere (including through airport security). They don’t require special equipment to read (though a comfortable spot with good light is always nice). You can hand a good book over to your mother if you think she’d like it (no DRM police knocking on the door in the middle of the night). It doesn’t even matter if you are a Windows of Mac user (books are platform agnostic).

Not surprisingly, many of these freedoms have been available for motion pictures and music as well (though there is often a limitation related to electricity). It is only when the media is digital that restrictions are applied. Suddenly, the specter of piracy makes businesses panic. When they panic, they restrict the very things that make their products so attractive. If you talk to ordinary people who purchase digital media, you will be a bit surprised by the number of otherwise law-abiding citizens who seek out pirated media (though they do not always understand the pirated part) because they simply cannot deal with the limitations of DRM.

The EMI deal recognizes that consumers want flexibility when it comes to music. Many great thinkers on this topic have pundited that this is the year DRM dies (oh, DRM, we hardly knew ye). The deal requires consumers to pay a bit more for the product — something I think will be confusing if only because consumers don’t really get the DRM thing to begin with — but it also offers a higher quality bitrate. Granted, as Kirk notes, “It should be noted that the new “premium” songs are only available in an AAC format (not mp3 as widely reported). It seems unlikely that we’ll see the option to purchase music in a lossless format any time soon.”

One hand giveth, one hand taketh away. It is hard, we know, to give the people what they want.

What lessons can publishers take away from this deal? First, the earth did not fall off its axis when this deal was announced. There wasn’t a seismic increase in piracy nor noticeable decrease. It’s too early to tell if consumers will embrace a higher bitrate in a non-MP3 format. Or if they’re willing to spend more for DRM-free music.

The key lesson to take away here is that consumers should, at the very least, be given freedom when it comes to products they’ve purchased. Combatting piracy by adding additional locks and keys does not appear to help. Restricting media to specific platforms and hardware only frustrates the people who buy your products. The harder you, the purveyor of art, make it for the people who want to buy your product, the more likely it is that they’ll go elsewhere. As we all know, in the online environment, that elsewhere is the last place you want them to go.

EMI made a bold choice, given the pressure from industry peers to stand arm and arm with DRM. We hope the book industry takes note of this move!

File Under: The Future of Publishing

5 responses so far ↓

  • Morris Rosenthal // Apr 4, 2007 at 8:33 am


    I’ve been publishing ebooks with DRM for a number of years. J. Wynia (The Glass is Too Big Blog) hated the DRM on my publishing book and wrote about the experience:

    “But, like a perfectly grilled steak served up on a dirty garbage can lid, it’s not entirely the content that matters here.”

    Back when Amazon was selling Lightning Source’d ebooks, I usually had a title in their top 100, and I’d estimate I got one DRM complaint per month. I know I issued some back-channel refunds or sent printed books to customers who really had trouble with it.

    That said, when I’ve explained to customers why I use DRM, I’ve gotten a pretty good response. For me, the purpose of DRM is to make it 100% clear to customers that they haven’t purchased distribution rights with the ebook. It’s not like I read the EULA’s I click on myself, so I don’t expect anybody else to either. Without DRM, some percentage of customers wouldn’t think twice about passing along a PDF or posting it to a forum.

    As a web based publisher, the number of people who read me online exceeds the number who buy my books by a factor of several hundred or more. But, I’m dead set against the notion that the marketplace or the reading public should be able to decide how my works should be distributed or whether or not I should get paid. I may make the wrong decisions, maybe I’d see my sales go up if I published everything under Creative Commons license, but they are my decisions to make.

  • Kassia Krozser // Apr 4, 2007 at 9:20 pm

    Absolutely they are your decisions to make and it sounds like you’ve actually put some thought into your choice. There is a difference between distributing books and consuming books. The former — and I think we’re both using the same definition (correct me if I’m wrong; you won’t be the first and certainly won’t be the last) — pertains to putting a book into the market in some manner, whether for financial gain or not.

    The second — the issue I’m discussing in this post — relates to how a person who buys a book interacts with it. DRM does not have to mean restricting the consumer to specific rules for consuming media. Proprietary formats necessarily leave a portion of the reading market out of the game (I tried to figure out the DRM you’re using, but either missed it or missed it). If I have to use X system to read a book, but my system is Y, sure it’s a business decision on the part of the publisher, but I’m going to be a lost sale. If I am desperate to get my hands on that particular book and I were of a pirate nature (alas, I look awful in eye patches), I might consider alternate scenarios.

    I truly believe that most people will pay for their entertainment media. This, despite my lack of faith in humanity (I’m the girl who used to collect articles about anti-piracy successes to prove that money spent on anti-piracy was worth every penny; I’ve lead a sad, weird life). That being said, when using something you’ve paid for becomes harder than the perceived value, then the consumer will consider alternates for acquiring that media.

    Finding the right balance — the right DRM for the media — is a work-in-progress. The pendulum is swinging toward less restrictive DRM. The EMI example is instructive because they’ve kept the price of a song within a range that most people consider “cheap”. They’ve chosen a retail outlet that everybody but me seems capable of of working without a hitch. They’ve chosen a format that people can play on a variety of devices. All of these make the idea of spending a little over a dollar a much more palatable choice for consumers — especially given the alternative of seeking out a pirate server that has the song in an easily acquirable way without the possibility of getting a nasty virus in the process.

    Finally, thank you for admitting that you don’t read the EULAs. I feel shame for my insistence on reading contracts when I skim the fine print myself…

  • Kassia Krozser // Apr 4, 2007 at 9:27 pm

    PS — one more thing. You, as author and publisher, are making the decision for yourself. However, it should be noted that different authors have different takes on this — which I think is great because we are in an age of trying different approaches to see what works — and when they sign with a publisher, they aren’t necessarily given a choice in the matter. I am thinking back to something that came up a few months ago where a blind reader couldn’t listen to the ebook she’d published from a major publisher.

    There were many reasons bandied about — including the audio rights to a book. This was the worst argument because it showed a clear misunderstanding of what this reader was doing and what audio rights are. The publisher in question suggested that the authors decided if the audio option was available for an ebook, but the authors were all “huh?” No author I know of would deny a blind person the ability to do what a sighted person can do — and the way this person wanted to “read” the book was virtually the same way a sighted person would read. Instead of her eyes reading the text, the computer read the words…in the computer voice. This was not a performance nor something that most people would choose. It is how blind or sight impaired individuals “read” text online.

    The above probably feels like it’s veering off topic, but it’s part and parcel of DRM. Locking out options locks out readers.

  • Morris Rosenthal // Apr 5, 2007 at 4:07 pm


    First, forgive me for spelling Kassia with a “C” last time, I definitely wasn’t handing out a grade.

    The DRM on my ebooks is applied by Lightning Source, though whether they still use Adobe software to do that is unclear to me as Adobe announced a year or so ago they were getting out of that business. Since Amazon no longer lists LSI supplied ebooks, you’d have to go somewhere like Powells to see them. The only reason I didn’t discontinue them after Amazon dropped them (so long to $500/month on the bottom line) is for those overseas customers who would have to pay a fortune for shipping a paper book, or wait a lifetime for a slow boat.

    I’d be interested in reading more about your collection of anti-piracy success stories. With the advent of duplicate content penalties in the search engines, it’s become an endless annoyance for me, and I find that pirates are actually LESS responsive to take-down requests than they were a couple years ago. I assume that’s either because they don’t see any high profile cases of “little guys” getting hit with big sticks or because everybody is doing it. The DMCA filings are a lousy solution, they take hours to prepare and the writer or copyright holder gets treated like a criminal to boot!

    I’m aware that some authors see DRM, and in some cases, copyright, as evils we would be better off without. I’m obviously not one of them. I’ve earned a modest living purely from writing and publishing the last 10 years, I’m not a performer or a consultant who can treat writing like an advertising expense.

    I’m not as sympathetic to authors who find DRM they don’t like on their ebooks as I am with authors who’ve been hurt by screwy discount clauses, non-competes, and other trade publisher contract clauses. In the thousands of e-mails I’ve gotten over the years from authors, a problem with the DRM their publisher applied hasn’t come up a single time:-)

    Seven years ago, I went to the major ebook conference that was supposed to solve the DRM and compatibility issues for the ages. One speaker, I think he was the chief engineer for the original hardware ebook solution, maybe Rocket, gave a demonstration of cracking Microsoft’s DRM of the time. He did a demo with a laptop, showing an ebook with the DRM, and showed that he couldn’t read it. Paraphrasing from faulty memory, he said:

    See, can’t read this ebook. It’s F-‘d. What do you do with an F-‘d ebook? We go on the web and find a way to Un-F it.

    And he downloaded a so-named program that did just that. I suppose the main reason I remember was his unorthodox use of language, though we couldn’t avoid laughing. But looking back, I think the sales pitch was:

    And that’s why you only want your ebooks to be downloaded from authorized servers to our proprietary hardware reader. Any other protection is only an Internet crack away.

    I gave up on the idea of publishing ebooks for money when I came back from that conference, and it wasn’t until I’d been using Lightning for a couple years for on-demand printing that I gave their ebook program a shot. I was really surprised at the sales, which I attribute primarily to instant gratification buyers, because neither the rise nor the fall of ebooks on Amazon had any effect on my paper sales, it’s just a different type of buyer.

    Talk about veering off topic:-)

  • The OPLIN 4cast » Blog Archive » OPLIN 4cast #50 // Dec 12, 2007 at 9:10 am

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