Nathan Bransford, Author


Wednesday, August 22, 2007

DRM vs. Piracy?

One of the hats I wear at Curtis Brown, besides my toupee, is that of an audio rights specialist. You know all those audiobooks your mom likes to listen to in the car? Well, those rights don't just sell themselves, sweetie. Audiobooks are a continually growing business, and within that growing business, downloadable audio is a fast-growing part of the overall growing business.

So it was with a keen eye that I read in Publishers Lunch (subscription required) last week that Random House Audio has decided to move away from DRM in an attempt to expand the overall audio market.

Background. DRM, or Digital Rights Management, is software encryption intended to prevent piracy by limiting the use of an audio file. So, for instance, when you download a song or audiobook from iTunes, you can only transfer that song or audiobook to a certain number of devices. DRM is also used by library programs such as Overdrive to "check in" and "check out" electronic copies -- literally you have to "check out" your audiobook to listen to it, and check it back in to the library before someone else can use it. Just like with a hard copy.

So basically DRM is intended to prevent piracy, by making it more difficult to reproduce a file endlessly, and to control usage, such as with Overdrive's library program, to prevent free downloads from overwhelming the market.

But one perceived downside with DRM is that there are compatibility issues. For instance, most music downloaded on iTunes can only be played on Apple-compatible devices like iPods, and most music downloaded on, say, Overdrive can't be played on iPods. Some people feel that this creates confusion and frustration in the marketplace, and many people I know continue to buy CDs simply because DRM annoys them and they want to be able to burn and share the CD without the hassle.

Fast forward to last week. Random House Audio Group publisher Madeline McIntosh announced in a letter: "The potential benefits of moving away from DRM are clear: it would allow the market to open up, so that any online retailer would be able to compete to sell content destined for any device, including the iPod. The hope is that the greatly-simplified consumer experience, coupled with greater retail competition, would lead to growth."

However, Ms. McIntosh points out, "the risk is also clear." While DRM was by no means a perfect encryption device, it did make it incrementally more difficult to pirate a digital file. It seems as if there would be a correspondingly incremental risk of increased piracy when people are downloading easily share-able files.

So put on your author/agent/consumer hats on and you tell me: Does the benefit of growing the overall audio market by eliminating consumer frustration/confusion, increasing competition, and making audio files universally compatible outweigh the risk of increased piracy? Would you make your work available DRM free? What if you were a bestselling author like J.K. Rowling or Dan Brown?






31 comments:

Conduit said...

I've never purchased, or even listened to, an audio book, so I may not be best placed to comment on this one, but...

I have doubts about this. Because I listen to music albums again and again, I much prefer to buy a physical product. A download seems so disposable, plus there's the slight but audible loss in signal quality with an MP3 file. So, I've never been tempted much by downloads, and I don't want bootlegs - I want the real thing so I can hold it in my hands. Likewise with DVDs. I want something I'm going to have on my shelf for years, so I need a quality product, not some cheap knock-off.

An audio book would be a different thing, I think. First, the audio quality isn't quite so crucial so long as it's listenable (you could get away with as little as 96kbs files), and second, I'd probably only listen to it once, or twice at most. Therefore, a legitimately purchased audio book would have less perceived value than a CD or DVD, other than your conscience being clear. Seeing as we live in the real world, and even the most honest citizens will copy CDs for their own use, I could see removing copy protection on audio books eating a chunk out of sales - depending, of course, who the main audio book users are. If they aren't that tech savvy, maybe it's not an issue.

Dunno, is the short answer! :)

Stephen Parrish said...

The debate continues whether piracy truly harms recording industries. At first glance such harm seems obvious, but opponents argue long term promotional benefits as well as the fact that most illegal downloads weren't going to be purchases anyway.

One thing seems certain: the pirates are going to beat anti-piracy measures. We may as well assume piracy is here to stay, and work on turning a problem into an opportunity.

I would cringe if my book were copied illegally. On the other hand, I would be flattered that people would break the law to get their hands on my work!

Annalee said...

'Piracy' is a pretty big misnomer when applied to copyright infringement. A pirate is one who uses the sea to facilitate the commission of a crime-- usually a felony. Stealing an audio file is indeed theft, and copyright infringement, but it's got nothing to do with the ocean. And more importantly, it's not a felony.

My problem with Digital Restrictions Management is that it unfairly deprives me of my rights as a consumer. When I buy an audio file, I *buy* it. I do not *rent* it. If the vendor wants to 'license' me to use it in certain ways but not in others, he needs to call his business an audio file rental business.

As a rule, I avoid doing business with companies that employ digital restrictions management. It's not that I'm worried the restrictions will stop me from using the file in the ways I want to use it-- at worst, they'll pose a minor inconvenience. But I don't like doing business with companies that believe they have the right to install spy-ware and malicious code on my computer. I'm not a criminal, and I resent being treated like one.

So good on them for deciding not to rely on DRM. It doesn't prevent copyright infringement anyway (no, really. I'm a total layman when it comes to computers, and it takes me a grand total of a few minutes to take a DRMed-up audio file and turn it into a good old-fashioned MP3). I will be far, far more likely to purchase their audio books now.

Gav's Studio said...

Does DRM stop piracy no? As it's a code to be broken and you can bet that there are people that like nothing more than spending hours and hours cracking codes.

Or alternatively you could go to a Library borrow the Audio CD, copy it to your computer and then share it with the world - no DRM involved.

DRM just makes it harder for those who have legally bought something to use it as they wish - with CDs you can stick them in your computer, stereo, car and lent them, sell them or use them as coasters. With MP3s you are tied in. If you play by the rules that is.

And most people play by the rules. They want to invest in their favourite author, singer, etc so that they can have more from them in the future. Those that don't play by the rules don't want to invest and never did in the first place so there are no lost sales there.

It's when people feel ripped off or constrained and they stop buying that you have to worry.

I'm all for things being DRM free as long as they are worth paying for in the first place. So the answer is not whether to have DRM or not it is to give us something worth paying for in the first place.

Christopher M. Park said...

Ah, DRM. This is something that has essentially been around for computer games (in various forms) since long before mp3 or movie piracy was a big concern (and audiobooks, more recently). The thing is, the games industry has tried all sorts of encryption and keys and such, and none of that works. The main strategy that works these days for games and other software is enforced registration or "activation," which I'm sure you know that Microsoft is big into if you've ever installed Windows or Office. But even this can be fooled -- hackers have already set up fake authentication servers so that they can pirate Windows Vista. And even the newer DVD protections have mostly been compromised, I understand. Hackers love a challenge.

The thing is, some people will always steal, and so those people are a loss either way; they aren't your customers in the first place. I think that the goal of DRM, as you say, is just to make it incrementally harder for the rest of us to steal stuff. If we actually have to work to circumvent the copy protection, it's more likely to seem wrong to us.

This is all well and good, and I certainly support that aim wholeheartedly, but DRM implementations often wind up being far too draconian. Too many usage restrictions not only prevent me from sharing with friends or strangers (which is good), it prevents me from making full use of it myself, or making proper backups for disaster recovery purposes (which is bad).

Right now, audio books seem a lot safer to me than mp3s, at least. A single song is only a few minutes long, and thus a couple of megabytes at most -- easy and quick to download or to send to someone else. Audio books, by contrast, are so long that it's going to be several gigabytes of data per book, I'd think (I don't have much personal experience with audio books), so presumably that alone would make them a lot more inconvenient to pirate.

Services like bittorrent would work for pirating audio books, if they are that large, but otherwise the bandwidth costs and hosting requirements would just make it too easy to find offenders and get their feeds taken down. I think that's lucky for the audio book industry.

In short, I support the aims of DRM, but not the methods, and I think that audio books will have a low piracy rate (for now) regardless. After all, it would be vastly cheaper and easier to just scan in the actual pages of the book and post those on the Internet, but we don't see a lot of that. If moms and other baby boomers are the primary consumers of audio books, I don't think they're going to be actively doing much pirating, anyway. For those in the age range that would be most likely to pirate, it seems like they would just want the text, or else page scans.

Piracy is a real problem, and we're eventually going to have to figure out a serious solution to it, but I think that audio books by their very nature are not a desirable pirate commodity. Maybe that's just showing how strong my preference is for the printed text, though.

Chris

Anonymous said...

I hate DRM. There's a big stink going on right now over the recently released PC game, Bioshock. Apparently, installation is limited to two installs. Not, you understand, two computers, but two installs. Period. So if you reformat, change your hardware, whatever, the game won't install a third time. This promotes piracy in a way that making DRM-free content does not. There's a cracked executable for almost every game on the market. There's an entire site devoted to cracking the executables of games, for the sole purpose of making the DVDs unnecessary (lots of people use these with legal copies of games, either because the DRM makes their DVD-ROM drive not work or just so they don't have to dig the DVD out every time they play.) This site has been around for a very long time, and almost every gamer knows about it.

There's a certain percentage of people who will steal no matter what. The majority of them would never have been consumers anyway. You'd be surprised how many people steal products and never even look at them; I've known quite a few game/PDF/music collectors in my life. (I don't understand filling up a hard drive with stuff you're not even interested in, but it's hard for me to get worked up about it.)

DRM will stop the casual thieves, the ones who will buy the product if they can't get it free, but is the risk of annoying your honest customers worth it? A lot of people don't actually mind purchasing products even if they're available for free, but if you make it more of an annoyance for them, don't be surprised when you see an increase in pirated intellectual property.

Needless to say, I would not want the electronic content of my books to be encoded with DRM. Good on Random House.

Scott said...

I live most of my days in an online world, and a big chunk of that in an open-source corner of that world, so my initial reaction is "copy protection=bad."

But this is a difficult problem. I'd much rather sell my own stuff than give it away for free, especially if you look at how little most writers make per hour on a novel, even if it sells moderately well.

You asked about best-selling authors like Rowling. Actually, I think they're the ones who lose the least. OK, maybe they lose more in total dollars, but the money they lose probably has less impact on them than even a couple thousand would on a less successful writer. They still make a living and then some, even if they lose a bunch of copies of their audio book.

Still, that doesn't make it OK. They have a right to payment for the copies people steal.

Honestly, I don't know the right answer on this. I dislike DRM for the reasons you mention. If I were to buy a music CD and I couldn't copy it, I'd be ticked. I like to put a copy on my laptop and often make another copy for listening in the car, since other people who use the car tend not to put CDs back in cases when they take them out of the player.

DRM is a flawed technology, at least from a consumer POV. Maybe they could come up with something better that I'd dislike less. Will they? Who knows.

I guess my final vote would have to be against DRM, though I don't want to cast a vote for piracy, and those are the choices you gave us. There's gotta be an answer somewhere in between.

I mean, it's not quite like software, is it? If I don't want to pay for Harry Potter, I can't exactly go out and find a FOSS alternative that does pretty much the same thing. I might find a free book (there are thousands of free e-books, don't know about audio books), but it's not going to be a free alternative to Harry Potter, just a totally different book.

Dwight's Writing Manifesto said...

Even Steve Jobs is trying to run away from DRM. When I reinstalled iTunes recently I was given the opportunity to buy DRM-Free music, whenever there was that option available.

No one has more to say about the evils of DRM than author/advocate Corey Doctrow.

One of Corey's core theses is that DRM gives the owner of the DRM the right to "renegotiate" their contract with the buyer at any time, usually with no notice.

For instance, with every update of iTunes, they change the rules for the DRM. You can only play a given song on seven machines. WHOOPS, we changed our mind, make that five machines.

Uhm, yeterday you could burn CDs from a playlist as often as you want, but today we're going to limit it to five burns off a given playlist.

DRM is a good idea which has been carelessly executed.

Scott said...

By the way, dig the new pic.

Still not sure about those shoes, though.

Dave said...

Most of my experience is with ebooks rather than audiobooks, but I've dealt with DRM enough to form strong opinions. I hate it.

The first problem is that it doesn't work. There's no form of content protection that hasn't been cracked. So, adding DRM does not remove or decrease piracy. In fact, there's anecdotal evidence that avoiding DRM decreases piracy.

Baen books has a policy of making unencrypted copies of their novels available electronically a couple of weeks before the print publication date. Most of these books are sold for between four and six dollars, or in a monthly bundle that's usually six books for fifteen dollars. Baen books are underrepresented on ebook trading sites and usenet because the books are available in the form people want, at a reasonable price.

DRM simply imposes restrictions on honest users. I recently damaged my Palm TX, and had to go back to using my old Ipaq. If those ebooks (I buy from Baen and Fictionwise multi-format) had been DRM'd I would have had real problems transferring the ebooks. They weren't and I didn't.

Whether you have copy protection or not, unprotected versions of your audiobooks will be freely traded to those who really want them. Adding protection will simply drive up the price and make them harder for legitimate purchasers to use. You end up punishing your loyal customers. The increased price, and reduced utility will push one or more users over the line between buy it and download it. DRM will actually increase piracy by making the legitimate copy undesirable.

I'd avoid it.

Dave said...

To add another comment:

Not only would I prefer that my work be available DRM free, but if I was choosing between two publishers, I'd be much more likely to go with one that made things available DRM free.

Of course I would also see if I could give an electronic copy of my first novel away free as soon as the second came out.

Graham said...

I absolutely would not mind an easily downloadable audio book. For one thing, as a college student, I have been known to dl music. While this is all evil and Metallica apparently hates me for it, I made several CD and movie purchases that I NEVER would have made without dl'ing the music first. It's kind of like the radio--find a song you like on the radio, buy the CD. Find a decent song on the internet, buy the CD. Same way with audio books. I use audio books as suppplementary--when I'm working or excersizing and can't read, then I listen. I own all the books in paper form that I own on audio book (nearly). And as for being a best selling author...it's not a battle worth fighting. There's already illegal copies of Deathly Hallows online!

Patrick McNamara said...

DRM only hurts the legitimate users. Even the most basic hackers know about the analogue flaw where something as simple as a tape recorder can be used to copy the playback. While copy protection does have some effect for software, it's useless for music and video. All it does it to annoy legitimate users and make it difficult to do things they legally have rights to do.

What's worse is that when they get rediculous about it, such action forces legitimate users to take illegal action. When someone purchases a CD they want to buy the music, not just some limited rights to listen to the music.

Books don't have as big a problem because it's often cheaper to buy a copy of the book (at least second hand) than to print it out. And there's always the library.

Anonymous said...

Nathan --

THIS HAS NOTHING TO DO WITH YOUR POST -- but Realitysteve.com has hilarious recaps of your favorite show "The Hills" (and other reality shows) on his website.

Scroll down until you get to "The Hills" entry. I don't even watch reality TV and I still read his recaps.

J M Peltier said...

I listen to audio books frequently. It makes it much easier to be well read if I can load a book on my mp3 player and listen at work. My standard tactic is to check out the audio book from the library or borrow a CD from a friend and copy it onto the player.

DRM is the reason I don't use Overdrive. I tried to install it, and it threw some obnoxious DRM error on my media player, as has every other DRM-based program I've tried. So I don't use DRM.

I've heard there actually is an ebook/audiobook pirate community out there, but I've never seen it myself.

As for audiobook piracy really hurting, I can say (from my experience listening to library audios) that when I tell my wife about a cool book I listened to and recommend the CD, she checks the hardcopy out of the library.

So I think the real money to be made with audiobooks is in word-of-mouth raising the business of hardcopies. I mean, let's face it--most people don't listen to audios. When I'm not at work, I read hardcopies.

Jenny said...

Given the market for audiobooks isn't the 19 year old hacker who buys music and games, the comparison probably isn't as valid as it seems.

As you pointed out when you started your post, Nathan, it's an older demographic who buys them. My guess is that the audiobook buyer is a subset of the demographic of older people who still read. (The only ones who still read in any numbers if that recent survey is anything to go by! It sounds like younger folks have even stopped lying about reading.)

So while grandma probably will lend her audiobook to other ladies at the Home, I doubt she's going to upload them to a file sharing site. Or download them. Nor will the middle manager who buys audiobooks so he can learn something during the long drive home. It probably was a nonissue all along.

I've been selling non-copy protected business books online for years and they never showed up on file sharing sites either. My buyers weren't 18 either.

joycemocha said...

I'm going to join the throng who doesn't like DRM in any form. I don't like the limitations, and by golly, if I bloody well pay for the product, I'd like to be able to make copies for archival purposes, create my own music mixes, and things like that.

For audio books and my own writing, I still wouldn't worry about it. For one thing, I don't think the volume of ripoffs is going to be that high; for another, my hope would be that the reader would find my work so fascinating that they had to find more of it--thereby creating another fan.

IMO, DRM gets in the way of the word-of-mouth transmission.

I also avoid DRM because it does tend to screw things up like computers, music players, DVD players, and I can remember a few VHS movies that were royally screwed up by DRM stuff.

Jen said...

I've never bought an audio book, so I'm not sure how annoying having DRM would be.

All I know is, the music industry's version of this copyright protection stuff crashes your computer - now THAT, I can say with confidence, should be changed.

DRM doesn't sound too bad, but I don't know how much piracy it's actually stopping - AND it's obviously causing problems for buyers. So...I think I'll go with no DRM.

Marti said...

Holy cow, I feel like such a technotard with all of these really smart answers. LOL

For a non-techie, I find it frustrating not to be able to transfer media (songs or audio books) from one listening device to another. So I think removing DRM would be a good thing.

Thank you for a very thought provoking post! Hope you have a great evening!

Michele Lee said...

A combination of works available for free and works you have to buy in the store (or online) seems to work well...

audiobookman said...

I'm a small audio book publisher, and when I read that article on Publishers Lunch I saw it as a win-win for RH.

They get the publicity for eliminating the copy protection scheme, and their legal department goes into overtime to find violations of their copyrights.

With the slim margins available in audio titles, a few infractions prosecuted successfully could put a title in the black.

Luc2 said...

First off, I'm a dig-i-diot. And I never listened to an audio book.

Jenny may have a point: the demographic for audio books is less likely to have many "pirates" than the demographic for music, games DVD's etc. But it is a growing market, and there is money to be made. So it may be naive to think that there's less chance of audio books being copied.

Also, the decrease in quality is probably not a "dealbreaker" regarding audio books. So when I may not buy an illegal copy of a DVD, I might be more inclined to buy an illegal audio book.

I'm a bit annoyed at the ease with which people dismiss attempts to protect products "because the hackers will win in the end anyway". That rankles me as a matter of principle. So if you can't curb illegal activities, just accept them? It's easy to talk if you're not one trying to earn your living in that business in an honest way.
Oh dear, I'm sounding more and more like my dad. :(

JohnP said...

Let me put it this way: the only ebooks I've ever bought have been DRM-free. I've bought a dozen or so novels as eBooks, and I regularly subscribe to Analog magazine in electronic format. All free of DRM. It's just easier and better.

DRM prevents the reader from reading when and where they want. It's as simple as that. Yes, it makes it harder to pirate but there's a truism in computing - if you can read it, you can copy it. There is no such thing as truly secure DRM. It's a phantasm that rights companies chase to avoid treating their customers as adult human beings with rights and responsibilities of their own.

pax et bonum

Anonymous said...

DRM is annoying. To use a music CD example:

I don't buy CDs often because I'm a student and hence poor, but when I do it's because I really like the band and want to support them etc. Once I inadvertently bought a DRM'd CD which I couldn't copy to my computer/ipod. I don't listen to CDs. I don't even have a CD player anywhere near by any more. Even in the car I burn mp3 CDs so that there's more variety and I don't have to worry about changing disks and scratching one. I listen to music on my computer or ipod. That means I couldn't listen to this CD which I had legitimately paid for.

So what did I do? I downloaded it for free and swore never to buy a CD from that band again because they had wasted my money. Others may disagree but to me a CD I can't listen to is definitely a waste of money.

Back to audiobooks. Audiobook piracy is no where near as widespread as music or video (TV shows and movies included) piracy is. I mean, sure, Harry Potter is pretty easy to get but for most things searching out a free copy of the book is far more effort than just buying it from itunes, even if you know where to look.

On the other hand, the only audiobooks I listen to aren't really audiobooks anyway. They're podcasted short stories and free by default.

Short version: DRM = silly.

And to luc2, we're not saying that we should give up on DRM because the pirates are going to win anyway, we're saying that DRM encourages pirates and irritates consumers, so it's lose-lose.

Jenny said...

One last thought that occurred to me is that the population that listens to Audiobooks is ALSO the population that gets them from the public library.

In my region, all the libraries carry a lot of audiobooks, so if a person wants a free one, well, there's no need to go black market.

And because of the characteristics of the audiobook listener, it's likely that she/he is a frequent library visitor.

Dave said...

This is regarding Luc2's comments regarding people "accepting" piracy. I'm not saying we should not work to stop piracy: I'm saying we shouldn't use methods that not only don't work, but actively alienate paying customers.

DRM decreases your customer base in and of itself. As soon as you add it, you lose all the customers who refuse to buy things with DRM. It doesn't mean they will go steal it, merely that they won't buy it. DRM also raises the cost of your product.

Now let's say DRM adds 10% to the price of a product. It's going to add to the cost, and it's easiest to model if we just pass that along to the consumer in its entirety. Now with that 10% surcharge, it's only going to make economic sense if the DRM makes it hard enough to pirate that for every 10 people who won't buy a DRM product, you get 12 sales from people who would have pirated it if it weren't protected, but buy it instead.

This can only work if the DRM is sufficiently restrictive that the people who would normally pirate it can't find it through their usual sources. Unfortunately, DRM doesn't work. Since it's going to be cracked, it won't convert piracy to sales. It's net effect is a loss of revenue.

It's not that I'm advocating rolling over and just accepting piracy. It's that I'm saying DRM is not an effective method of preventing piracy. The costs so outweigh the benefits that it's not a valid strategy.

Anonymous said...

I have a subscription to Audible and listen to audio books regularly. In the beginning, I was just downloading them and burning them onto cds because it wasn't compatible with my obsolete mp3 player (huge pain that was), and I bought less books because it was tedious and burning takes time. Then I broke down and got an IPOD, and that's made things a lot easier and I go through about one a week.

As far as the DRMs go, if I'd wanted to be a wanker and burn a kagillion copies, it wouldn't have been any more difficult if they had been encrypted. Once the files are burned, the cds don't have anything that stops them from being copied.

If it were my book, I'd be thrilled to have it on Audible. With or without the encryption. I really don't see this being the same issue that the music industry went through. For one thing, the audio files are just huge. Hard drives only have so much space, so the file size limits how much you'd actually want saved on your computer or mp3 player. And who really wants to carry the 7 or so cds that it takes to burn each book?

Maya Reynolds said...

To complete the self-referential loop, subscribers to Publishers Lunch ought to check out its newest feature, Publishers Lunch TV.

Michael Cader has been posting videos since early June. One of the videos is of a great four-person panel at BEA called "Giving It Away."

Chris Anderson (he of "The Long Tail" fame) was a part of that panel. His newest book, which he hopes to finish next summer, will be called "Free" and focuses on the subject of making publishing content available for free--supported by advertising.

Anderson suggested that it would be feasible to offer a traditional advertising-free book for $19.95 or an alternative book for free supported by advertising.

For those of you with a PL subscription, go to:
http://www.publishersmarketplace.com/
members/PLTV/giving.php
to view the video.

For those of you without a Publishers Lunch subscription, I did a post about the panel on 6/10 titled "Chris Anderson is Back."

RMS said...

I agree with most here; DRM is a bad idea. I believe if a product is reasonably priced, people will buy it. Sure a few will steal it no matter what, but I think the majority really do wish to pay for what they get. I applaud this move. Customers need to be treated with respect and as customers, not as potential thieves.

ankur said...

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