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Experts debate: Is DRM good or bad for consumers?

An FTC conversation discusses business-model benefits

By Grant Gross
November 8, 2006 12:00 PM ET

IDG News Service - Speakers at a Federal Trade Commssion event Wednesday argued that controversial DRM (digital rights management) technology may actually be good for consumers because it could give them more choices for downloading or buying copyrighted content, despite previous high-profile failures of such projects

DRM, which allows copyright holders to control how customers access content, could lead to new pricing models favorable to consumers, said James DeLong, a senior fellow at the Progress and Freedom Foundation (PFF), a conservative think tank. For example, instead of paying $30 for a new book, consumers may soon be able to pay $3 for a digital copy that lets them read it once, he said.

Similar schemes for "disposable DVDs" or "closed home-video systems" such as DIVX and Flexplay have been market failures.

Limited-use works will be cheaper than unlimited works, DeLong said. Before DRM, "you could do what you want with it," he said. "But is that a good thing?"

Others on a panel discussion about new technology products aren't convinced DRM is such a good deal for consumers. The panel was part of the FTC's three-day conference, "Protecting Consumers in the Next Tech-ade."

When told of survey results that suggest consumers would be willing to pay twice as much for a music download they could play on more than one device or share with a small number of friends, Urs Gasser, director of the Research Center for Information Law at the University of St. Gallen in Switzerland, said that before DRM technologies, consumers didn't have to pay extra for those things.

Until DRM matured, consumers had control over how they used digital content, noted Deirdre Mulligan, director of the Samuelson Law, Technology and Public Policy Clinic at the University of California, Berkeley, Law School. DRM is creating a "permission culture" where consumers have to ask the copyright owner's permission to play a piece of music on a both home computer and a car stereo, she said.

Until DRM, "there was a lot of breathing space in copyright law," she added.

In addition, many consumers don't understand DRM restrictions, and they're surprised when a CD that works on a home stereo can't be played somewhere else, she said. Vendors offer "little disclosure about how consumers can use" DRM-protected content, she said.

But Andrew Moss, senior director of technical policy at Microsoft Corp., claimed that DRM will be important to consumers as more of them began to create their own digital content. DRM will allow them to control how their creations are used, he said.

"What [DRM] is intended to do is give people choices," he said.

Moss and Tom Jacobs, director of research at Sun Microsystems Inc. Laboratories, sparred over the way to achieve DRM interoperability. Jacobs called for open DRM standards that allow researchers to reverse-engineer DRM technologies and check for bugs or trap doors.

But Moss said interoperability can be achieved through a variety of means. Engineers can figure out ways to make proprietary DRM systems talk to each other, without consumers knowing what standards are used, he said. "From the consumer's perspective, they just want things to work," he said.

Reprinted with permission from IDG.net. Story copyright 2014 International Data Group. All rights reserved.
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