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March 21, 2006 | Suw Charman Anderson

French lead the way on music downloads

French MPs are examining measures that would force the sharing of copy-protection software with the aim of ensuring that any music can be played on any player regardless of format or source:

The French bill says that proprietary copy-protection technologies must not block interoperability between different systems.
Rightly, the French are worried about monopolies. DRM is cast by the industry as a way of stopping 'piracy', but it's blindingly obvious that the most compelling reason for DRM is to lock people into a vertical niche markets - if you have an iPod and you buy all your music from the iTunes Music Store, you become dependent on future iPods and iTunes to play your music. Yes, there are workarounds, but if you've invested hundreds of pounds on hundreds of tracks, burning them to CD and then re-ripping them is not an attractive option. Forcing interoperability would be great for the consumer and, ultimately, I believe it would be great for the industry too. I had a really interesting chat yesterday with a researcher from the BBC's Money Programme about new business models for the creative industries, and it really set me to thinking about where they have gone wrong. The industry's existing business models are based on scarcity - they control production and distribution of creative works, and the value is (or rather, was) in the scarcity of those works. Because you couldn't obtain them any other way, you had to buy them from the producer. New business models will have to be based on abundance. Instead of controlling the flow of product on to the market, the industry is going to have to accept that as soon as they have a product, it's going to be digitised and distributed whether they like it or not. This abundance, this ability to easily copy bits, is not going to go away, and it will never be thwarted by either technological methods or legislation. Instead, business models have to take into account ease of acquisition, value for money, quality, and speed of access. They will have to make their products - including their entire back catalogues - desirable, accessible, high-quality and simple to purchase. Who really wants to faff about with a P2P network and risk getting some nasty malware on your PC if you can buy what you want right here, right now, at a reasonable price? It is my belief that one reason that the creative industries are so far off the path of success in this economy of abundance is a thing called the 80-20 Rule: 80% of your profit (allegedly) comes from 20% of your customers/products. Thus has business attempted to cut out the less profitable 80% of their customers/products. You can see this in the way that record labels focus almost exclusively on their top-selling acts, seek to replicate those acts in their new signings, and dump any band who fails to recoup the costs of their first single (or album, if they are lucky enough to get that far along in the process). This focus on the 20% means that the industry discards the 80%, without ever considering the fact that if they made their 80% more easily accessible, they could turn a decent profit on that too. If you've ever examined the blogosphere or social networking or any of those other web phenomena, you'll be familiar with the power law distribution, aka the Long Tail, another name for the 80-20 Rule. In blogs, it says that the minority of blogs get the majority of links and traffic. The stupid blog commentator thus focuses on that minority, believing that because they get the majority of the Google-juice, that that is where the power is. In actual fact, they should focus on the Long Tail. The majority of area underneath a power law curve is under the tail, not the head, and this is where we get into power law marketing, or niche marketing. And this is where the creative industries are losing out big stylee. Digitise your back catalogues, make them easily accessible, affordable for bulk buying, and you can immediately tap into the sort of format re-purchasing that started in the late 80s when the price of CD players dropped out of the luxury goods niche and people started replicating their tape or vinyl collections on CD. Now people want to replicate their tape/vinyl/CD collection in MP3, but they remember buying CDs of music they'd already bought 20 years before, and they resent the idea of paying full price for it a third time. Unlike CDs, however, bits don't cost all that much to create or distribute, and there is no compelling reason for consumers to pay full price. The technology for digitising music has been created; the technology for distributing digitised music has been created; the incentive for buying digitised music has been created. What more is the industry waiting for? The belief that music is property and that download is theft and that consumers are criminals is pervasive in the creative industries. They have a misplaced faith that DRM is going to solve their woes. Instead, they need to discard DRM and start thinking creatively about how to distribute their music to as many people as possible, and turn those people into fans who will then reach into their pockets and hand over real money for something that has real value. I doubt that they will do this voluntarily, but if this French bill is passed, it may just give them the push they need.

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Comments (9)

  1. squashed:
    Mar 27, 2006 at 01:35 AM

    I think the french battle is really about 'Apple" vs. Microsoft/mp3 player industry. I am a bit weary viewing this as 'good for more open' intellectual property. The wife of one of recording companies(forget who) is a french MP. And the recording company giants hate Apple.

    PS. Web Admin, you need to add Openrightsgroup.org into technorati, so people know and can search content better. (The site is a bit busy as of late, the auto scan will take 24 hrs, just leave the registration process running and comeback the next day)

    http://technorati.com/

  2. Suw Charman:
    Mar 28, 2006 at 02:25 PM

    Re: Technorati - done.

  3. Bricolage Fantasy » Weekend Note:
    Apr 09, 2008 at 02:19 PM

    [...] Tweaks DRM laws. From The Open Rights Group: French MPs are examining measures that would force the sharing of copy-protection software with [...]

  4. Jose:
    Mar 22, 2006 at 05:26 PM

    Suw you make some good points. I don't have much to add other than to say that I'm looking forward to ebook readers (but I'm not buying one from Sony, no thanks I'll wait) but the current state of some ebooks has me very skeptical.

    Some outfits are asking Twenty Five dollars for a copy DRM text file. I can buy at least three paperbacks for that much money.
    But eventualy there will be a non Sony ebook reader and there's plenty of good writers out there who will want to sell me their books direct. I'm confident that Sony's efforts in this regard are doomed but I'm really glad you guys at Open Rights are in the trenches.

    Keep at it Suw, you rock.

  5. Glyn Wintle:
    Mar 21, 2006 at 07:53 PM

    The new French law was covered on channel 4 news, saying that it would mainly effect apple as they had most of the market.

  6. squashed:
    Mar 27, 2006 at 01:37 AM

    Comment by Simon Gibbs

  7. Simon Gibbs:
    Mar 22, 2006 at 01:26 PM

    "The belief that music is property and that download is theft and that consumers are criminals is pervasive in the creative industries."

    So what? The first belief is true, the others true in part. You place this sentance in front of "they need to discard DRM" as it if is a premiss, yet the first sentance can be removed without affecting the validity of the conclusion. Is this a statement of ORG policy that copyright on music should not exist?

    "I doubt that they will [start thinking creatively] voluntarily," I hope that they do it voluntarily, what's the alternative? State imposed fines? Prison? The French are taking steps to ensure competition in the marketplace, this is a good thing, but don't take it as evidence that state control over the form of the market itself is desirable or appropriate.

    SJG

  8. Suw Charman:
    Mar 25, 2006 at 09:50 AM

    Nowhere do I say that copyright should not exist, and to interpret this post as saying that is erroneous. I think that copyright is a sound concept executed badly, but I also think that basing business models on enforcing non-copyability is flawed. Those aren't contradictory statements. You can have copyability, and copyright, and a sound business model. Just look at Cory Doctorow's novels for an example thereof.

  9. Julian Bond:
    Mar 21, 2006 at 10:18 PM

    "They will have to make their products - including their entire back catalogues - desirable, accessible, high-quality and simple to purchase. Who really wants to faff about with a P2P network and risk getting some nasty malware on your PC if you can buy what you want right here, right now, at a reasonable price?"

    Easy and cheap beats free and hard. Which is why an AllOfMp3.com model can work. 192kb LAME VBR encoded MP3 without DRM. Charge $5 per album for the first 3-6 months. Then drop the price to $1 per album ever after. Offer lossless at $10 dropping to $2. Once the system works, digitise every piece of audio ever recorded and offer it up. It's a volume game.

    There is an argument that DRM has allowed Apple to grow the PMP market and build new distribution routes such as iTMS because it has given them a temporary monopoly. But it still sucks. And perhaps that temporary monopoly is coming to an end.



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