It seems to me that mostly since the beginning of time we have been grappling with the problem that, for intellectual property, the cost of production is MUCH higher than the cost of reproduction.
We want to have lot's of production of intellectual property because that creates useful things in the world. But that production may be limited if it has competitors operating unchecked at the cost of reproduction. This is true for songs, books, patents, movies, programs, and probably this post.
So, in the public interest, we have found many clever ways to subsidize production at the cost of taxing and limiting reproduction, and built them into our culture and laws. But, like most government granted subsidies and monopolies, the process has become politicized, complicated, and somewhat out of balance. For one thing, the fine print of our laws has become too complicated to understand and economically impractical to literally enforce in a modern age of computers and fast electronic communications.
For another, the process tends to entrench obsolete business models of those with existing powerful lobbies.
And worse, distributors and middlemen (reproducers) inevitably get control of the production anyway and game the laws to limit competition in both production and reproduction.
I offer no solutions. :-( - Tom Craig Birkmaier wrote:
This thread is getting interesting. Jeroen has unearthed some of the real reasons for content protection. Let's take a closer look at his logic...At 12:59 PM +0100 1/17/07, Jeroen Stessen wrote:To me, good content protection increases the value of content, because it adds exclusivity. I would feel stupid buying a movie for 20 dollars and then my friend tells me I could have got a copy for 1 dollar. Likewise, you would not want to stay in a fancy hotel if the guy next door was letting in homeless bums.So with content protection, you can pay more for exclusivity. Now that's a real bargain...But it does point to the real reason for content protection. The movie industry understands that they can charge a premium to some customers, while others will simply wait until they can get a better deal. If you just can't wait to see a movie, you can pay the full price of a theater ticket for EACH person who wants to see the movie. If you can wait a few months, you can pay a little less to watch the movie on an airplane, in a hotel, or on a premium service like HBO. Wait a little longer and you can buy the DVD, which can be watched by multiple people.By now the "potential" value of the content has been reduced, as all of the people willing to pay a premium have seen it. So we sell it to the networks who fill it with ads and put it on TV. Or we can rent the movie for a few bucks.What makes this value chain workable? Content protection. Jeroen would be upset if he learned that he paid 30 Euros to take the family to the theater only to see some guy with a camcorder in the next row making a copy that potential thousands of people could download for free.But the people who are watching the "free" download are upset that it would cost them 30 Euros to take the family to the theater, or that they must wait months to rent it for a few bucks. So we need content protection to protect Jeroen's investment in exclusivity, and to keep the riff-raff from watching the movie until it is less "exclusive."And then there is geo-political disparity to deal with. This is the "mother" of region coding on DVDs. Sorry Jeroen, but the rich folks in the U.S. get the first shot at paying a premium to watch a movie; in fact, we (the studio) may release the movie on DVD in the States, before it even hits the theaters in the Netherlands. So now we need a way to keep Jeroen from buying a DVD in the States while he is here for the Tech Retreat, or he might take it back to Europe and lets his friends watch it, which could reduce the Theater Box Office proceeds in Europe.Along the same lines, we can't let Jim Burger get on an Internet connection at the hotel he stays at in Palm Springs for the Tech Retreat, and access the news from a Washington DC TV station, because we need to protect the exclusivity of the Palm Springs TV stations.So in reality, Content protection does not really protect the content. It protects the value of the content, because some of us are willing to pay more to see it than others.So what if you can't make all the copies that you like ? You paid for the right to watch the movie in its intended way, and you can even do that multiple times. A decent DVD here is about the price of 2 or 3 movie tickets. For a ticket you only get to see the movie once, you can't stay all day and go in and out of theaters. If you want to see the movie in another way, you may have to pay again. I suppose that this is all calculated into the price of the DVD. If it allowed unlimited copying, it would have to cost a lot more.Jeroen takes aim at the real reason for content protection here. Clearly all decisions about the pricing of content are calculated into the business model. As the content moves through the value chain it becomes worth less per copy - The content oligopoly would have us believe that illegal copying makes content worthless, but this is simply not the case.You can download almost every movie within days of release in a theater. So how is it that months later the studios are still able to making millions off of the DVD release?Illegal copying IS the primary form of release in many areas of the world, and within certain economic communities in the U.S. The studios know that some people will not pay the full price, or simply cannot afford to pay the same amount as people in other countries that have more disposable income. So they actually USE piracy as a form of distribution. The best part of this little deal is that all of the revenue comes in under the table - no taxes.The problem with Jeroen's logic is that most of us are honest, and would not make illegal copies of content if the price was reasonable. But paying $10-15 for a CD to get one song we want is not fair either. At least now we can download that song for 99 cents legally. So the very pricing model that the content moguls use is the major reason that they need content protection.Jeroen's logic is exactly backwards. Allowing unlimited copying should make content cost less. Or a corollary, if content was priced fairly, it would not be necessary to protect it.Consider a different value proposition.1. Theatrical release is not coupled with the desire to own a copy of content. The theater is a "destination," a place to go on a date, or to take the family for a special experience. Some people go to the theater to see the same movie two or three times - its all about the experience.2. For everyone else, there is a reasonable price to consume the content. How much? That depends entirely on how many people you want to see the content. Price that DVD at $19.99 and you will sell 2 million copies; price it at $4.99 and you may sell 200,000,000 copies.3. What if we could download first run movies for $1.99 and burn a DVD copy for $4.99? How much money would the studio make then?The bottom line, is that there is a significant price attached to exclusivity. You can't make everyone watch or listen to everything. We have different tastes and there's not enough time to watch everything. So by creating artificial scarcity we can drive the price up. There are only a handful of private suites (boxes) in the football/soccer stadiums around the world. Scarcity drives the price "sky high."But it would increase the value of the hotel... A house you can own. Apparently you never own a movie. You don't even own the software on the computer that you read this with, you only have a licence to use it, and maybe for a limited time. But the price is only a fraction of what it might have been if it had granted you unlimited rights.Another flaw in Jeroen's logic. Copy protection has never worked well on PC software. The really successful programs are - brace yourself - FREE! Now that Microsoft is using the Internet to track copies, the price is going up, because people are growing tired of the hoops that Microsoft is putting customers through. So they are looking to more affordable alternatives.The reality is that when priced fairly, people are more than willing to pay for software. There is a huge shareware industry out there that has helped many entrepreneurs to bootstrap their companies.The main reason people pay high prices for protected software is to get documentation and support.One of the ways that Microsoft built their empire was to look the other way at piracy. At one time they had a promotion for Word and Office which essentially said: "We don't care how or where you got an illegal copy, just pay us $99 for an upgrade and you'll be legal.Another unmentioned reality about piracy of content is that it makes the content more valuable. How can this be?The best form of promotion for content is word of mouth. If the content becomes popular, a larger number of "honest" people will learn about it and buy it. Radio is a promotional engine for the music industry, much as "Free TV is a promotional engine for the good stuff produced by the content oligopoly.Sometimes giving something away is the best way to make it popular so that you can make money selling a related, or the next product. Eventually you'll make your money back tenfold.Look at broadcasters here in the U.S. In the early days when there were only four networks to watch, the cost was putting up with the ads. Now, fifty years later, with much of the best content distributed via these same networks and local stations, we are being asked to pay subscriber fees for programs that have about twice as many ads in them as the average 50 years ago. And the broadcasters want content protection to maintain their market exclusivity.And we all know that making digital copies is so trivially easy that without content protection everybody would practice their ill intents. I see and hear it all around me, friends telling me how they don't buy discs anymore because they download everything.Reality does not bear this out. The studios are making more money than ever. Yes, there are certain classes of people who will not pay, either because they cannot afford the high prices, or it is culturally acceptable to buy cheap pirated copies. But the vast majority of people do pay, and many more would pay if the price was fair.I am quite convinced of your ill intents too, hehe. ;-) Again: you can't act as if you own the content, because you don't. The true owner has the right to protect _his_ property. BTW I make the copies mostly to protect the content from the clumsy hands of my 3 year old son. These Disney DVDs are too expensive to be abused daily. Disney could have solved that with an exchange system, just pay for swapping the data carrier. But they didn't. The protection is not strong enough though.I do not consider this ill intents. It is the intent of the seller to make life difficult for you that is wrong. The technology is now available for these folks to make more money than ever, and they need not protect a single bit to do it. They just need to sell their products at a realistic price.Regards Craig ---------------------------------------------------------------------- You can UNSUBSCRIBE from the OpenDTV list in two ways:- Using the UNSUBSCRIBE command in your user configuration settings at FreeLists.org - By sending a message to: opendtv-request@xxxxxxxxxxxxx with the word unsubscribe in the subject line.
-- Tom Barry trbarry@xxxxxxxxxxx Find my resume and video filters at www.trbarry.com ---------------------------------------------------------------------- You can UNSUBSCRIBE from the OpenDTV list in two ways:- Using the UNSUBSCRIBE command in your user configuration settings at FreeLists.org
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