Dispatches from the Digital Revolution
Last Thursday I packed up my notebook and trotted down to Tremont Street for a Bookbuilders of Boston panel at Emerson College. The topic was digital rights management, or DRM, and little did I know that I was entering the crossfire of an intense debate on one of publishing’s hottest topics.
The discussion at the panel was heated, with sentiments aggressively pro-DRM and aggressively anti-DRM. The crux of the issue is that the industry is shifting: while in the past publishers have served a predominantly B2B (business-to-business) function, we are quickly becoming, in some respects, a B2C (business-to-consumer) industry.
Panelist Jake Furbush, digital publishing manager of MIT Press, phrased the DRM problem succinctly: “DRM prevents the reader from fully using content—it creates an access model rather than a purchasing model.”
Suddenly, publishing is responsible not only for a product that will be passed on to final consumers and left in their capable hands but also for continued maintenance and control over their product. “The way we’ve always done things” does not prepare us for this. Publishing’s initial reaction is the same as the music industry’s in the Napster era: lockdown.
But that brings its own difficulties. Though its purpose is to restrict unauthorized access, DRM in effect restricts even the purchaser’s access. During Thursday’s panel, Furbush commented that when a consumer purchases an MIT Press title, they actually only purchase access to the title. The book always lives on MIT servers and is never actually in the user’s possession.
And that’s not the only objection. DRM can interfere with taking creative advantage of the digital world, sometimes restricting the ability to link out of an ebook to supporting media. It can make customers feel like they’re being treated like thieves.
And worst of all? It doesn’t work.
At least, it doesn’t work well. A quick Google search on “DRM” immediately brings up related search terms of “DRM removal” and sponsored results on “How to remove DRM.”
So how should publishers react? The jury’s still out. Tim O’Reilly, founder of O’Reilly Media, is a vocal opponent of the practice. According to panelist Adam Witwer, director of content and publishing operations at O’Reilly Media, “DRM is out of the question.” But others—like panelist Skott Klebe, information security manager at the Copyright Clearance Center—are vehemently in favor of the solution, at the very least because publishers can’t do nothing to protect their authors’ intellectual property.
But even those in the pro-DRM camp realize that DRM in and of itself is not a great solution. The best way to combat piracy, according to Klebe, is sustainable pricing models: i.e., charge a price that customers find reasonable for the content.
The chart below is essentially Klebe’s argument: the higher the price and the easier to copy, the more piracy—and the worse for publishers. But the harder it is to copy and the lower the price, the less piracy—and the better situation for everyone.
In fact (now that we’ve gotten started with charts), piracy relates pretty well to the model below, the Triangle of Fraud. This is the framework that fraud analysts use to investigate accounting fraud, and it works pretty well to identify why piracy happens, too.
The two central factors influencing piracy are high content prices and cheap bandwidth, Klebe said, quoting a keynote lecture from the recent O’Reilly Tools of Change conference. These factors provide the pressure (high prices) and opportunity (cheap bandwidth) for piracy to take place—leaving only the rationalization factor. The rationalization can come in many forms: “I already own the book version.” “It’s not worth as much as they’re trying to charge.”
It’s good to note that the type and frequency of these rationalizations relate differently to different areas of publishing. Professional/trade publishers, who are publishing works that are critical to consumers’ work or professional performance, have consumers who treat paying for content as an investment (and may frequently expense the purchases to their companies anyway). But textbooks’ final consumers—students—often have low funds and are required to purchase books they are not necessarily motivated to read. They are practically handed their “rationalizations” on a silver platter.
And so the DRM discussion continues. Is Klebe right? Could lower prices be the key to critically reducing piracy? If so, what is that price point? And how will that change our publishing models?