DRM: Its Main Goal and Main Mistake
With increasing popularity of Internet facilities, the necessity to protect copyright emerged. Compared with paper-based works, the problem of copyright protection of digital works which are distributed via the Internet is more difficult. The thing is that it is hard to trace piracy, because of global access to the Internet facilities (Everett 2010, 5). So, various mechanisms which are now famous under the name DRM were introduced in order to protect copyright of digital information: eBooks, movies, songs, etc. For many years DRM was the only term to protect digital products from unauthorized usage. Still the system of DRM is not perfect. On the one hand, its imperfection leads to negative profit of companies which work in the sphere of distribution of digital works. However, on the other hand, the introduction of DRM led to limitation of consumers’ facilities: they were restricted by DRM in the usage of digital works, although it did not contradict the law of copyright.
Is DRM an Effective Term for Copyright Protection?
The piracy became a topical problem in the contemporary world of economics and entertainment industry. Lots of various products, from eBooks to HD-TV films, are touted and used without authorization. So, it is not a surprise that large and other not so talked-up music industry tycoons and companies which distribute films, music albums, eBooks, use DRM and make efforts to change the situation. A consumer had to pay money, and, than, download a track or a movie. The mechanism of copyright protection seemed very simple and inviolable.
Still, recent changes in the world of music industry make people wonder what made huge companies introduce DRM-free environments. Still, reasons for such changes are quite rational and logically explained. “The Recording Industry Association of America (PIAA) (2009) estimates that music sales declined from $13,7 billion in 1998 to $8,5 billion in 2008” (Sinha, Machado and Sellman 2010, 40). In other words, the decrease of demand on the market of music became a factor of inevitable changes in the sphere of digital market. Of course, the majority of experts blamed digital pirates for sales slowdown. Still, for many experts the phenomenon of the sales slowdown was a result of consumers’ limited capacities in many aspects (Sinha, Machado and Sellman 2010, 40).
The First Wave of DRM-Free Environment
A great change was observed when in 2007 “iTunes began selling part of its catalog DRM-free” (Sinha, Machado and Sellman 2010, 40). Many companies remembered that they could do the same in order not to lose the market positions. By the way, the elimination of DRM protection by the giants in the sphere of music industry, iTunes, was a resourceful manoeuvre: “consumer could only download music from the vendor’s iTunes store on to its market-leading iPod devices” (Everett 2010, 6). Of course, the introduction of a DRM-free environment was a dubious question: it had its advantages and disadvantages. On the one hand, the introduction of such a term could mean a bright future for companies which did not became as large and successful as Apple and Amazon. On the other hand, it could mean nothing: only huge companies could get profits, which was questionable as well. Nevertheless, the introduction of DRM-free environment meant great changes for digital market. The increase of purchase requirement meant a new challenge for the music industry, so music distribution corporation had to offer consumers new opportunities (Gopal, Marsden and Sankaranarayanan 2009, 140). The Microsoft Corporation and its Zune did not eliminate DMR; still, it reduced consumers’ restrictions a bit. Nevertheless, consumers were limited of CDs, DVDs burning (Sinha, Machado and Sellman 2010, 41).
What Does DRM-Free Environment Mean for Music Producers?
As for companies, it is clear that all they have to do is to provide some music samples DRM-restricted, and some – DRM-free. As for companies which produce the music, the question how their governments should decide which albums should be DRM-restricted, and others – DRM-free, remains unquestionable. Some experts in the field of music industry are sure that there exist three main requirements for decision of DRM status. The first requirement is the absence of any negative impact which could negatively influence the sales of alternative music formats of the sphere of industry in which this or that company which draws profit (Sinha, Machado and Sellman 2010, 41). The second requirement means that corporations which work in the field of music distribution should draw profit in any case.. The third requirement is quite obvious: DRM-free environment should promote the increase in demand. All in all, it becomes obvious that companies would have to work hard in order not to lose a potential consumer.
Possible Ways to Increase Purchase Requirement in the Sphere of Music with the Help of DRM-Restricted and DRM-Free Environment Balance
The first and main step companies should take is to understand what makes people download DRM-free and what – DRM-restricted digital works. Psychology is an important branch of science which may help increase demand and cover the loss caused by piracy and unauthorized distribution of digital products. The main mechanism which can be used by representatives of the music industry is the reactance as a psychological phenomenon. It is obvious that millions of people are not satisfied with the idea that they should pay just to listen to their favorite track.
It is reasonable to hypothesize that DRM restrictions have the dual effect of reducing consumers’ utility for legally bought music and increasing reactance among consumers who value the social network benefit of sharing music (Sinha, Machado and Sellman 2010, 50).
This factor may lead to a negative attitude towards DRM. Still, according to statistical data, the loss is insignificant because “under certain circumstances, many consumers will prefer to pay for a product they can sometimes get for free” (Sinha, Machado and Sellman 2010, 50). Although the introduction of a DRM-free environment was beneficial for music marketing, the essence of DRM is the double-edged sword. “One edge of the sword is dull, in that DRM has not yet been shown to be an effective tool to combat piracy” (Sinha, Machado and Sellman 2010, 51). The other edge of the sword is the successful introduction of DRM-free in some economic and strategic aspects. There is another step which is used successfully by the majority of companies. Numerous experiments proved that purchase requirements can be increased by introducing discounts to tracks which are less popular. For example, iTunes corporation announced that the price for one song which can be described as less popular would be about $0,69.
All in all, the introduction of DRM –free environment was a beneficial strategy. Still, it is obvious that the DRM-free model has positive effects only in combination with DRM-restricted strategy. Of course, combinations should be balanced so as not to be harmful for the music distribution industry.
Reference List
Everett, Catherine. 2010. “Is DRM Fit for Purpose?” Computer Fraud & Security: 5-7.
Gopal, Ram, Marsden, James, & Sankaranarayanan, Ramesh. 2009. “Re-Tuning the Music Industry – Can They Re-Attain Business Resonance?” Communication of the ACM 52: 136-140.
Sinha, Rajiv, Machado, Fernando and Selman, Colin. 2010. “Don’t Think Twice, It’s All Right” Music Piracy and Pricing in a DRM-Free Environment.” Journal of Marketing 74: 40-54.