Friday, December 30, 2011

The Case for and Against DRM

By BigAl 

A few weeks ago, we had a post that discussed alternatives to Amazon and Barnes & Noble for purchasing eBooks. One of the advantages some of these alternatives had was that they don’t sell eBooks with DRM (Digital Rights Management), and I promised a future post on this subject. In this post I’ll lay out the arguments for and against from the viewpoint of both the author and the reader.

What is DRM?

Digital Rights Management or DRM is a method intended to insure that consumption of digital content conforms to license terms. Also called copy protection, DRM limits the ability to make or use copied digital content including computer software and digital media such as music, video, and eBooks. In this post, we’ll be discussing DRM only as it relates to eBooks, although the experiences of other industries are pertinent to the discussion.

What You are Really Buying: The difference between paper and digital media.

I’m not a lawyer (and none of this post constitutes legal advice, although hopefully it is reasonably accurate). It is also very US-centric. Although much of it is accurate elsewhere, the laws involved can and do differ in other countries.

Many people may not realize the difference between purchasing digital and physical media and the different rights this gives them. In general, if you have something physical (a book, a computer disc containing software, a CD, or a DVD) that you’ve bought, you can lend it or resale it. Whether you can copy it and allowable uses if you do depends on the terms of the license. Allowable uses are defined by a license that comes with the product, by copyright law, or a combination of both. For our discussion, the key thing to know is that the right to copy or have copies (if any) goes with the physical product. For example, if you have MP3s on your computer or MP3 player that were ripped from a CD you purchased then you are probably not in violation of copyright law. However, if you later sell the physical CD and don’t delete the MP3s, you are in violation of the copyright.

With digital goods, the consumer doesn’t have a physical product. What they are purchasing is a license that grants specific rights to use the content in clearly defined ways. They have no right to resale, for example. Depending on the eBook and where it was purchased the license may grant limited lending rights. They might have the right to keep a copy of their purchase somewhere as a backup. They might have the right to keep a copy of the book on multiple devices or for multiple people to read it at the same time (as in different devices attached to a single Amazon account).

The Case for DRM

Creating copies of a paper book is labor intensive. Whatever method is used will be of a lower quality than the original without significant investment in time and equipment. In contrast, creating copies of a digital file is almost effortless and the copy will be the same quality as the original. Almost anyone with a computer can reproduce unlimited copies of an unprotected electronic book. Authors, publishers, and other interested parties may decide to add DRM to their books to protect their interests. The theory is that DRM will prevent piracy by making it more difficult to produce usable copies of their eBooks. Even if someone has the skills to circumvent the DRM, it will be more work for the pirate. It will also prevent what I’ll call social piracy — when people make a single copy for a friend rather than for widespread distribution.

The Case against DRM

On the surface, the case for DRM seems straightforward and reasonable. If it prevented piracy and had no effect on legitimate purchasers’ use of the product, the case for using DRM would not be an issue. However, those who argue against using DRM say the effect on pirates is insignificant and what little effect there is on social pirating isn’t worth the downside of treating all your customers like thieves. In a discussion about DRM on another blog, I theorized that there are five kinds of people to consider when an author is deciding for or against DRM:


1) Those who actively pirate books by putting them up on pirate sites. They may or may not buy a copy of the book, but have the tools to easily strip the DRM. Whether a book has DRM has little effect on them. While targeted primarily at this group, DRM has very little impact on them.

2) Those who frequent pirate sites to obtain their reading material. As far as they are concerned, your book isn’t DRMed if they find it on a pirate site. This person is also extremely unlikely to actually buy a particular book whether it is DRMed or not. While they might get a book illegally and violate the author’s copyright, this is not a lost sale.

3) Readers who are not tech savvy and are never going to try anything out of the norm. They purchase their books from Amazon (or B&N) directly from their device or the retailer’s website, let it download automatically, and never go outside of the retailer’s system. *IF* they read on multiple devices or have multiple people on the same account, these people will all stay within the retailer’s system for everything. As long as nothing comes up to cause them to go outside their norm, they don’t know if your book is DRMed and don’t care.

4) People who are tech savvy and are not in category #1 or 2. These people buy your book and may mostly be like the people in category #3. However, they have enough knowledge to work outside of the retailer’s system. They realize any hardware might fail and they may, for example, want to keep a backup of all their eBooks on their PC. That way, if their Kindle breaks down, they could easily re-load it from the backup. However, those books with DRM won’t be readable. If someone in this group decides they would like to read your book on another device, maybe their Smartphone, you force them to stay within the retailer’s system, even though they might prefer to get books to the other device some other way. If they decide to change eReader brands, they realize they will lose their investment in eBooks. Anytime someone in this group runs into a DRMed book, they are at a minimum going to get irritated at the author/publisher and might potentially decide to stay away from their books in the future. They are also prime candidates to move to group #5. Personally, I’m in this group.

5) People who would fit in #4, but are worried enough about the potential of losing their investment (without removing DRM, which in some countries is illegal) or have run into DRM roadblocks/irritants enough that they actively avoid buying DRMed books.

While a subset of people in groups 4 and 5 might sometimes illegally lend a book, it is not going to be in any kind of volume. (Those are people in #1 and 2.) While illegal, in many cases the person who “borrowed” the book wouldn’t have purchased it, which means that while still illegal, it didn’t hit the author in the pocketbook. There is also a chance that this casual lending might gain the author a new reader, and actually be a positive for their pocketbook.

You can imagine the percentage of people distributed across these groups however you want. It doesn’t matter how many fit each because the only people who care about the book being DRMed and are significantly impacted by it are those who are paying customers and are not trying to rip off the author. The goal of DRM, to prevent and decrease piracy, doesn’t work.

Although there hasn’t been a formal study that I’m aware of, some authors have done informal experiments that appear to indicate lack of DRM doesn’t hurt an author’s sales and may actually help them. The trend in other industries has been away from DRM use because they have found the DRM creates enemies while not solving the problems it was intended to address. (One example is Apple’s iTunes store, which originally used a DRM scheme for MP3 downloads which was subsequently discontinued.)

Conclusion

Each reader and author needs to come to their own conclusion based on perceived risk, convenience, and their view of the future. If Amazon or Barnes & Noble were to go out of business, this would leave Kindle or Nook readers in the lurch when their current eReader stops functioning. For readers who decide they prefer eBooks without DRM, it argues for using Smashwords or other alternatives to the major retailers; however, this is at a loss of convenience. It should be noted that although both Amazon and Barnes & Noble have DRM schemes, it is possible for a self-publishing author to opt-out of using DRM when first publishing a book on Amazon. (I’m not certain whether this is an option at Barnes & Noble.) However, there is no consistent way for a potential purchaser to determine if a book from either retailer has DRM or not prior to purchase.

14 comments:

J.M.Cornwell said...

I've used DRM on some versions of my books and not on others. As an experiment, I uploaded a DRM-free copy of my last novel to a site where people can download for free. I have noticed any fall-off in sales nor have I noticed any substantial bump. I don't think my name or my writing is recognizable enough yet.

I have decided, though, not to use DRM in the future. If someone wants to pirate my book, I'm fine with it because I believe that if they like it that much and more people are aware of me then more people will buy the book in print or as an e-book. There are hundreds of billions of people on this planet and I'd be happy if a few million of them knew my work and read my books. DRM or not, share, get at the library, or however they choose to read me, I just want them to read.

Barrie Abalard said...

This post is a nicely-balanced examination of the facts. Thank you.

I am a published author and I do choose DRM whenever I can. Why? Because I'm losing a lot of money to pirates. This isn't a hobby, it's my living. Currently I am the only one in the household making money. Not to mention, I deserve to get paid for my work. Thus, I do everything I can to thwart the pirates. It takes time and money to chase them, so I'd rather spend that time writing and using DRM. If that means I get fewer sales, so be it.

Ebooks are much easier to share with dozens, hundreds, even thousands of people than a print copy, so pirating means a lot more lost sales for the ebook author. I work hard to put out books, and I resent anyone getting to read them for free. I'll bet anyone who thinks they are entitled to read books for free wouldn't like it if they had their paychecks docked because some of their work didn't count. That's how I look at it. I did the work, I deserve whatever I make, so I'll pick DRM.

BooksAndPals said...

Thanks, Barrie. Balanced was what I was aiming for. If I were an author I think I'd not DRM my book(s) for the reasons JM Cornwell gives. Part of that is getting read by more people through whatever means and part is that I believe for most, if not all, authors it also maximizes their revenue. Another part of my reasoning is I would want to distribute through Smashwords to everywhere except Amazon and B&N where I would go direct. DRMing on Amazon and B&N when I wouldn't (because they don't allow it) on Smashwords doesn't make sense to me.

However, I can understand an author feeling the way you do. It feels like it should prevent or at least decrease the amount of piracy and it is the only action you can take that potentially will do so. I'm not aware of a scientific study on this, but logic and anecdotal evidence suggests it doesn't.

I'd be interested in what some readers have to say. Do any readers make purchasing decisions based on whether a book is DRMed? Are they concerned that this locks them into a specific eReader or that their book investment is at risk?

SJK said...

@Barrie Abalard:

To remove DRM it takes about 2 minutes to install the script, and then about 0.5 seconds for every book to crack

People who want to pirate books will not blink an eye at the effort, and share away, while people who got your book the legal way will be annoyed if the DRM acts up, and will remember it the next time.

Using DRM only prevents future sales, not piracy

Walter Knight said...

One day my son informed me that two of my books were being pirated.

Yes!

I have arrived!

Alessa Adamo said...

Very informative post. As a new author I didn't think much about DRM. I knew Smashwords didn't have it, and since they are my major distributor it wasn't even as issue. When I put my book up on Amazon they seemed to make a good case for DRM so I selected it. Since reading your post I decided against DRM. Unfortunately, I cannot change the status at Amazon. Once you select DRM your done. Too bad. Next time I'll rethink DRM.

Joansz said...

I'm on the side that doesn't like DRM for reasons sited. Additionally, since Amazon's ebook format (mobi) is proprietary and my ereader is a Nook where I prefer to read my ebooks, I can't buy a DRM'd Kindle book that is only available on Amazon. So, putting DRM on a Kindle only book will lose readers who would not obtain a pirated book.

Joan

BooksAndPals said...

Walter: I like that attitude. :) Better to be pirated than have no one want to read you books at all.

Alessa: Thanks. I think many authors do the same as you. Although I haven't seen what Amazon says about DRM I've got the impression that when publishing a book the default is to DRM it so many probably include DRM without thinking about it. On the surface, it makes sense.

Joan: You make a good point that by not putting DRM on a book that is going to be exclusive to Amazon a motivated reader who uses another eReader can convert to the book to the appropriate format. Barry Eisler had instructions for doing so on his website for his latest book that was published by Amazon.

One potential drawback is that there isn't a universal and consistent way to easily tell before purchasing whether a book has DRM or not. Some books are tagged as DRMed or Not DRMed. Some listings might mention the book doesn't contain DRM, but Amazon doesn't have anything in the listing, at least that I've been able to find.

Joansz said...

"Barry Eisler had instructions for doing so on his website for his latest book that was published by Amazon."
BooksAndPals: If I'm not mistaken, Eisler piloted this "exclusive" arrangement with Amazon. When I read his blog and the interview where he defended the Amazon exclusive arrangement, I argued that the interviewer had a point because most readers won't jump through what appear to be fiery hoops just to read a novel. My experience with SmashWords highlights this. When one of my FaceBook friends bought the paperback to my second book, knowing that she has a Nook, I sent her a SW coupon for a free ebook. She wasn't sure of how to get the ebook on her Nook, so I sent her instructions on how to do it. Although she did take advantage of the coupon, she complained about the process. Bottom line, anything that complicates the process of getting an ebook will discourage sales. I also think that SW should do everything they can to create a similar process that both Amazon and B&N offer.

Joan

BooksAndPals said...

You're right, Joan. Although the process isn't that difficult, especially when you've done it a few times, it doesn't come close to being as easy as purchasing a book on Amazon or BarnesandNoble.com with the book magically appearing on your eReader.

I think it would be possible for Smashwords to deliver a book to a Kindle. I'm not sure about a Nook. Every Kindle has two emails addresses that can be used to email an ebook file as an attachment and it will be delivered to the Kindle. One of these addresses is free and will only make the delivery via WiFi, the other has a small cost involved and will deliver via 3G. They call these personal documents and will also store them in their archive. I have an add-in app for my web browser that takes advantage of this and allows me to send a "clipping" of a web page to my Kindle. If SW did this the setup would be minimal, essentially entering an email address in your account at SW and entering a Smashwords email address to a white list on your Amazon account. Adding this would be a relatively easy enhancement. The issue I see is that if Amazon chose to change their policy they could shut this capability down, even if it was only just disallowing Smashwords email to be white listed.

There *might* be some other way for them to add this capability for eReaders that have WiFi, which seems to be the case for the current Nook models and all the current Kindle models except the large screen DX. I agree that doing so would make Smashwords much more palatable to many people.

In Mark Coker's year-in-review blog post yesterday he indicates that their development efforts this year will be more focused on improving the user experience. Hopefully this is one of the things on their list although it wasn't in the list of items he specifically mentioned. I would think if it was it would have been something he would have.

Mackey Chandler said...

I never noticed the Kindle/Nook pages don't tell a customer if a book uses DRM or not. Now that I am aware of that I'll put the information in my description. I feel strongly DRM doesn't stop a thief and just irritates your honest customer by treating him like one.

Joansz said...

Mackey Chandler: I completely agree. When the "record" companies started "protecting" the CDs that way, I stopped buying them--not that I buy that many, but still. I also prefer CDs and DVDs because their fidelity is better than MP3/MP4 files, which like jpeg, uses compression.

BooksAndPals: Maybe SW should develop an android app. A lot of people who have kindles and nooks also have android devices.

BooksAndPals said...

This morning (1/13/12) Amazon announced some new functionality. It is a program called "Send to Kindle" that can be installed on your PC (a MAC version is still being developed). When installed this program gives two ways to send "personal documents" to your Kindle.

http://www.amazon.com/forum/kindle/ref=cm_cd_pg_pg1?_encoding=UTF8&cdForum=Fx1D7SY3BVSESG&cdPage=1&cdSort=oldest&cdThread=Tx2LTSQWNQ5L7DR

One of these ways, not pertinent to this discussion, is what looks like another printer will be available to choose when printing from any Windows program.

The second way, which is pertinent to this discussion, can be done by highlighting the file on your computer in Windows Explorer, right clicking, and choosing "send to Kindle". This opens a dialog box where you pick which Kindle on your account you want to send it to, whether to use Wi-Fi or Whispernet (a charge may apply to this option), and if you want to archive the document in your Kindle archive. The file is uploaded via the internet and then downloaded to your Kindle using the normal process. I gave it a try and it worked smoothly.

Where I see this applying to this discussion is in two different ways, both pertaining to the relative inconvenience of shopping somewhere other than Amazon.

First, this program makes transfer of a downloaded book to your Kindle somewhat easier. It is no longer necessary to hook the Kindle to the PC to do the transfer, either by dragging and dropping or using a library management program like Calibre or to send via one of the Kindle email addresses. While this is a small difference, it is a difference, and results in a process that I think even relatively tech-phobic PC owners would be comfortable doing.

Second, although I'm far from an expert Windows programmer, it seems to me this probably gives Smashwords and other Amazon alternatives enough to "hook into" the functionality. I would think, if they wanted to expend the development effort, that it should be possible to build a process that would download a file from their site which would automatically kick off this process to transfer the ebook to your Kindle. It still wouldn't be as smooth as Amazon's 1-click, but would be much closer.

James Piper said...

DRM is too easy to circumvent. It does not limit pirating.

As well, if you have a download from Amazon (MOBI / AZW format) you can easily convert it to EPUB format for use on a Kobo or Nook or any other file format like PDF, TEXT, Word .DOC and so on.

Anything digital can be copied. It doesn’t matter what hoops you put in the way. If you think DRM is protecting you from lost sales, then you don’t fully understand what is going on.

I can go to a legitimate download library for e-books (part of my local pubic library) and sign out a load of them for use with Adobe Digital Editions. It’s set up to allow me to view it for one, two or three weeks. I can load it on my Kobo and use it there with the same time constraint. After the expiration date, I can’t view the file. But I can also run some software and within seconds the DRM is gone. The time restriction is removed. I can view those files next month or next year as well as send it out into the world for others to use.

DRM for e-books is a failure. It doesn’t work.

The only saving grace is in the places like the US where there are laws against cracking DRM. But what is gained if the FBI goes around to people’s home checking their computers and e-readers?