Quick Thoughts on Intellectual Property and DRM

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In a recent interview with Forbes, Tim O’Reilly said the following about DRM and intellectual property:

Let’s say my goal is to sell 10,000 copies of something. And let’s say that if by putting DRM in it I sell 10,000 copies and I make my money, and if by having no DRM 100,000 copies go into circulation and I still sell 10,000 copies. Which of those is the better outcome? I think having 100,000 in circulation and selling 10,000 is way better than having just the 10,000 that are paid for and nobody else benefits.

This position is problematic in a number of ways. First, and perhaps most obviously, O’Reilly’s example is entirely contrived. While he can speak to his own sales objectives being met (the 10,000), he has no idea how many people have pirated his books nor how many people might have bought them if piracy were more difficult or impossible. And simply put, I don’t know that many people are actually willing to settle for their sales projections in any case; most would happy to sell more than they expected, thank you very much. Such projections are typically floors, not ceilings, and to propose that theft might be okay simply because one meets one’s “objectives” is ludicrous on its face.

Second, there’s simply the principle of intellectual property to consider, which is that its owner has the absolute right to control it no matter whether his actions make good business sense (by whomever’s definition) or not. One can concoct any number of scenarios where giving intellectual property away could be a good business decision (e.g., giving away a song to sell more albums). And, one can decide, as O’Reilly does here, that having more people benefit from a book than actually buy it is a “benefit”—one has the right to be altruistic with one’s own property. But one person deciding that his property is better given away or sold without DRM doesn’t negate the right of others to control their own property however they see fit.

Third, while I accept that today those who pirate music, video, ebooks, and the like are in the minority, I also believe that there’s necessarily a trend in the opposite direction. The younger a person is, the more likely he is to gain access to and use the technologies that make piracy possible (e.g., Bittorrent) and to reject the very fundamental premise that intellectual property should be protected along with other property rights. The latter is due to both a lack of education in such principles and a general nihilism that causes many young people today to reject moral principles as such.

This isn’t limited to the young, however. Many people of all ages reject the notion that intellectual property is real property simply because it’s not tangible, because their concrete-bound mentalities don’t allow them to see where property rights actually come from. One possesses property rights—physical or intellectual—because of the value one has produced, either expressed by the intellectual property itself or the tangible item for which one has traded this value.

That is, I own my car not merely because I’m in possession of it (obviously, that changes when someone steals it), but because it represents the value that I produced and traded and that the car itself therefore represents. Contrary to some people’s assertions, there’s nothing magical about physical property that makes it more valid than “intangible” intellectual property. Without some means for protecting it, say the police or locks, gates, and alarm systems, physical property rights are just as prone to be abridged as intellectual property rights. And ultimately, it’s the law that secures my property rights—the police will track down someone who steals my car, return it to me, and punish the perpetrators—and not anything inherent in the property itself.

In truth, property rights really represent the right to control property, not merely to possess it. If someone forces me at gunpoint to drive them somewhere, I’m not enjoying my property rights merely because I’m still technically in possession of the car. A less extreme example would be if someone borrows my car without my permission while I’m away on vacation, and returns it unharmed. Even if he reimburses me for the gas used and wear-and-tear on the vehicle, my property rights have still been violated and the person would still be guilty of a crime. The fact that I made money on the involuntary transaction—just like an artist might have more attendees at his concerts because people are stealing his songs—has no bearing on the fact that it was, in fact, involuntary.

All of the same is true for intellectual property—it’s all about the ability to control the use of the property, not merely about “possessing it.” Indeed, the more abstract connection between property and a person’s efforts to create the value it represents should be even more clear with intellectual property. In truth, intellectual property is the value itself, directly representing an individual’s efforts and abilities.

Note that when we’re talking about intellectual property we’re not talking about the physical media on which it resides. That’s why the applicable legal principle is called “copyright.” The owner of intellectual property has the right to say when something can (and can’t) be copied, i.e., made available for use in another instance, as opposed to merely dictating who can possess and use, say, the paper on which a novel is printed. When we buy a book, or CD, or DVD, we’re not buying the intellectual property itself (the story, song, or movie), but rather one instance of the means to enjoy it—i.e., one copy. In this respect, intellectual property is stolen not because it’s physically removed from it’s owners possession, but rather—as with the borrowed car—because it’s used without the owner’s permission.

Finally, O’Reilly’s position is simply short-sighted. As time goes on, the notion that 100,000 people might pirate a book but 10,000 will buy it will be squeezed into oblivious. And so even practically speaking O’Reilly’s example is bogus. More likely, as the percentage of people who are comfortable with the methods and morality of piracy goes up (i.e., as older generations are replaced by younger generations), then the percentage who actually purchase intellectual property will necessarily fall. Then, even O’Reilly’s own artificial sales objectives will not be met, and one wonders what his position will then become.

O’Reilly also says the following:

People who don’t pay you generally wouldn’t have paid you anyway. We’re delighted when people who can’t afford our books don’t pay us for them, if they go out and do something useful with that information.

I think having faith in that basic logic of the market is important. Besides, DRM interferes with the user experience. It makes it much harder to have people adopt your product.

Many people who steal a car wouldn’t have paid for it. That’s kind of the point of theft, and most likely the easier it is to steal something without getting caught, the easier it becomes for anyone to tell themselves “I wouldn’t have bought this anyways” as they steal it. Again, the point is this: if you haven’t procured the intellectual property according to the rules established by the owner, then you have no right to enjoy it. Yes, O’Reilly has every right to allow people to pirate his books and convince himself he’s being noble by doing so, but he’s wrong that this can serve as some sort of general principle that mitigates the notion of intellectual property rights. At the same time, as far as people doing something useful with a book that they can’t afford, well, there are plenty of ways for physical (and now, even digital) books to be lent and borrowed. Libraries are one option that comes to mind.

About DRM interfering with the user experience: that’s true in some cases but not in others. I’ve not had a single problem with the DRM used in the Barnes & Noble Nook ecosystem, for example—books transfer and can be read as I expect, and I’ve yet to lose any value because they’re “encumbered” with DRM. The only thing I can’t easily do is copy them, which means that the DRM is doing its job without getting in my way. There have been some problematic DRM schemes in the past, but those were mistakes of technology not of principle.

Obviously this is a very complex subject, and I’ve only scratched the surface of it. But in this interview (and his responses only get worse after what I’ve covered here), O’Reilly has just thrown a blanket over the entire issue  and pretended it doesn’t exist. That does a real disservice to the creators of intellectual property and the ignores the tremendous impact as piracy becomes more widespread, as it necessarily must (and particularly as DRM is abandoned). Technology has made it trivial and almost without cost to digitally reproduce and distribute intellectual property, thus making the laws and methods for protecting intellectual property even more important. Given that he publishes technology-oriented books, O’Reilly should know this.

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