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What the powers-that-be think about DRM, and an explanation of the cloud

January 16, 2011 by Mike Shatzkin 84 Comments

My last post stemmed from a single catalyst: my frustration with what I feel is the tendency of those opposed to the use of DRM to promote the straw horse that people who defend its use must believe that DRM prevents, or even largely discourages, piracy. I know that isn’t true of me and I suspected that it wasn’t true of most of the powers-that-be in commercial publishing, on the publisher side or the agent side.

I agree with the contention from opponents of DRM that support for it doesn’t have much basis in meaningful data although, in fact, there’s not really much meaningful data on either side on the books for which this debate matters most. For some reason, it feels like the anti-DRM side thinks you need convincing evidence to justify support for keeping DRM, but it isn’t a requirement to advocate removing it. But it is clear that my proposition — that it is wildly inaccurate to accuse DRM supporters of universally believing that they’re stopping piracy by employing it — is researchable. So I took a poll.

Nine very high-level executives in seven different top dozen publishing houses, plus four literary agents with extremely powerful client lists (one of whom has experience on the publishing side as well), kindly responded with answers through email to three questions.

1. Do you think DRM is necessary to protect the sales of ebooks for popular titles?

2. Do you think DRM is an effective check against piracy?

3. Do you think the main benefit of DRM is that it prevents casual sharing?

I was transparent: I told people that my own opinion was “yes”, “no”, “yes”. I am quite certain that whatever I think doesn’t influence any of these people one iota.

Eleven of the 13 agreed with me that DRM is necessary to protect sales. Ten of the 13 agreed with me that DRM is not an effective deterrent to piracy. And 12 of the 13 agreed with me that DRM’s main benefit is to prevent casual sharing!

I don’t know how many DRM opponents have the interest or patience to read this blog, but please take note. It is either disingenuous or unsophisticated (or both) to use “it does nothing to deter piracy” as an argument against DRM. Most of the people supporting the use of DRM know that and agree with you. The news is “dog bites man”. You might as well try to persuade the other side by proving that DRM doesn’t cure cancer. We agree on that as well.

There was one big surprise for me in the data. Two of the four agents said they don’t believe DRM is necessary (at all, or hardly at all) to protect the sales of ebooks. (None of the publishers voted that way.) Four is too small a sample to leap to any conclusions, but it could be that my supposition that publishers promote the universal use of DRM because agents make them do it might be overblown.

Many of the respondents volunteered some additional thoughts and detail which also contained some interesting information. One top executive at a Big Six house who is an analytical person and who is a very fact- and data-based thinker reported that “of the key titles of ours that have been pirated, all have been scans or electronic copies of MS, none have been DRM protected eBooks.” (I find this rather startling. It undermines the frequent contention — which I’ve always tended to accept — that DRM is a futile barrier to piracy because it is so easily broken. If that’s true, why wouldn’t the pirated versions publishers are finding not come from jailbroken ebooks? Something’s not adding up here…)

And another executive, probably echoing the same observation from the evidence in his publishing house, said he thought I was wrong and that DRM did deter piracy, but he added “the DRM has to start much further up the chain to be effective.”

Of course, these observations beg for more research of the kind Brian O’Leary advocates. Pirated versions made from manuscripts can’t possibly be as satisfying reads as a jailbroken copy of a prepped ebook from the final copyedited version would be. Might some of the people who start reading a book with one of those switch over to buying the legitimate ebook? Might those posted copies be sales spurs that the publisher would be wiser not to take down? I don’t think we know.

One of the two agents who would throw out DRM and answered “no” across the board, had this to say (which would actually put him closer to my position, although we interpreted him to have answered the scorecarded questions differently).

“Let’s also realize that casual sharing has always been the practice with physical books. The only titles that might be worth DRMing would be huge bestsellers where there could be some erosion in sales. (My parenthetical note: We agree that casual sharing would be most damaging on the biggest books.) Everything else — especially smaller titles — would actually benefit from casual sharing because they need a larger base of readers to build a decent pyramid of sales. On the smaller titles, I doubt that the “casual sharers” would go out and buy the title but they might recommend it if they had sampled it. I know that many publishers are now giving away (or down-pricing) backlist titles of authors they hope to build. If there’s one lesson in all of this, it’s that the digital medium can be used in a variety of ways and we shouldn’t hamstring ourselves with DRM, except for the major authors as noted above.”

I got my most colorful answer from a publishing executive who believes, as I do, that the problems of piracy and the need for DRM will diminish as we move increasingly to cloud-based ebooks and away from downloadable. In a most provocative turn of phrase, this executive said that he supported DRM for downloadable ebook sales because “if you put The Da Vinci Code out there sans DRM it would be passed around like a 5 dollar whore at a frat party!” But his explanation of the cloud was more suitable for a family audience.

“There isn’t really a piracy problem but there isn’t really an alternative to DRM except for the cloud. The cloud means that you buy a product (NB: I personally would say you “license some content”, not you “buy a product”) and you get to access it on every device that you own — so long as you provide your ownership credentials. The cloud effectively means that you work only within a platform and that platform requires your credentials to access your works — so it is, in effect, DRM — but it really isn’t. That said, in order for this to work, it does need to protect files when they are downloaded — and that is true DRM.

“The whole world is moving away from download and own, so DRM is a moot point — only the library fanatics and the digerati care. The library folks are freaked out by the fact that they have no place in a world that makes all content accessible to single users anywhere, anytime — and they think that DRM is the enemy of the good. The digerati hate DRM because, well, they believe it is hindering their utopian digital realm.”

So the cloud takes us away from “download and possess”. Can it work? Well, if you use gmail and you think it works, that’s your answer. Why wouldn’t it work for you to access the content you have licensed the very same way? And why wouldn’t it work to protect copyright if giving another person access to what you had purchased rights to see was equivalent to giving them access to your email? Based on experience, that would be enough protection to satisfy me. Any sharing that took place under those conditions would surely not be casual.

Filed Under: eBooks, General Trade Publishing, Licensing and Rights, New Models, Publishing, Supply-Chain Tagged With: Brian O'Leary, digital rights management, DRM

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Mike Shatzkin

Mike Shatzkin is the Founder & CEO of The Idea Logical Company and a widely-acknowledged thought leader about digital change in the book publishing industry. Read more.

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