In February 2007, Apple's boss Steve Jobs made a very public call for major labels to abandon DRM on digital music content in exchange for interoperability, higher margins per download and other benefits.
In April 2007, EMI Music Group announced their intention to allow the sale of their music without DRM protection through Apple's iTunes online music store. Then in May 2007, Amazon announced the impending launch of a DRM free music download service.
So why is all this happening, and why now? Surely DRM's interminable bad press and poor consumer perception could not have led to this move towards the abandonment of DRM in favour of naked digital content. Or could it?
To fully appreciate the reasons for this apparent about face, it is necessary to understand the positions of the various partisan interests that make up the world of digital music, and other digital media content. The five stakeholder domains model presented in this article provides a comprehensive 360 degree representation of all the players in the digital content economy, which consists of:
- creative domain stakeholders (content creators and remixers);
- technology domain stakeholders (technology products and service providers);
- commercial domain stakeholders (content businesses and other exploiters);
- governance domain stakeholders (legal, legislative, regulatory and standards);
- consumer domain stakeholders (end-users or consumer of digital content).
Before examining these stakeholder domains in any detail, it is important to acknowledge some of the key factors and characteristics that have shaped and influenced the evolution of DRM and the digital content economy. They include:
- DRM is all about money. The digital content economy is strongly tied to the creation and circulation of wealth derived from Intellectual Property and DRM is ultimately an enabler of this economic viewpoint in the digital world.
- Technology will keep evolving, resulting in faster, smaller, cheaper and more powerful machines that make it easier to produce, distribute, market and consume content in any shape or form.
- The traditional boundaries between the stakeholder groups are becoming increasingly blurred especially between content creator and consumer. This is evidenced by the prominence of collaborative, participatory and contributory online content creation -which is sometimes referred to as Web 2.0
These factors all combine to shape the perspectives of the five stakeholder groups, and they form a recurring theme in their summary descriptions below. A more detailed exploration of the stakeholder domains and perspectives may be found in a soon to be published BCS book on DRM.
The creative stakeholder
This represents all the entities and individuals that create digital content in various forms (textual, audio or visual). Without the continuous output from this group there would be no content whatsoever and, as a direct consequence, there would be no need for DRM.
For this group, technology has made it much easier to create, collaborate, re-use and distribute digital content. Unfortunately it has also enabled the illegal replication and distribution of the content, which explains their stake in DRM and related content protection technology.
There is an emerging trend within this stakeholder group that sees artistes and other primary content producers becoming more versatile in exploiting the fast evolving multi-channel, multi-device, multi-format digital environment.
It is no longer enough for a content creator or artiste to do just one thing; instead they have started to create multi-purpose content that can leverage the different channels, formats and devices available to the consumers.
A prime example is the 'Year Zero' concept album by the rock band, Nine Inch Nails. Their work goes beyond the traditional music album concept by integrating an online alternate reality game (ARG) which also served as the prime viral marketing engine for the music.
In such a scenario, DRM could play an important role when used in a non-restrictive / non-intrusive manner to support the all important user experience; and to enable the business model for the whole concept - not just for one aspect (e.g. the music track) which is only part of the overall experience.
The technology stakeholders
Digital technology may be regarded by some as the main culprit in digital piracy as it enables the perfect replication and easy distribution of illegal content. However, it must be noted that without this stakeholder group DRM would not even exist.
The technology stakeholders include: makers of computing, consumer, and communication devices and technologies; IT companies, software houses, network infrastructure and content protection solution providers (including DRM vendors); it also includes hackers, crackers, virus writers and other denizens of the digital underworld.
Innovation is the main driving force for this group as can illustrated by the constantly evolving parade of better, faster smaller, and cheaper technologies and services.
The main DRM challenge for this group is the immense difficulty of translating the imprecise and subtly nuanced rules that govern the social, commercial and legal aspects of the analogue world which we inhabit.
That said, it is not an insurmountable problem given time; and current trends point to a future that will see the use of more intelligent personal technology to interact with, and enable the application of, these rules in the real world.
Such a future will most likely involve devices and solutions that address major DRM issues like: identification, authentication and micro-payments. A plausible scenario would see further evolution of today's multi-purpose mobile devices into something that delivers key services including:
- Primary identification device (with biometric authentication)
- Personal remote controller (for consumer devices)
- Payment mechanism (for both major and micro payments in lieu of credit cards)
- Current functionality (e.g. communication, entertainment, creativity and productivity)
The commercial stakeholder group includes: all individuals, groups and enterprises that acquire, process, package and distribute content as part of their business model.
Without this group, the relevance and need for DRM to enforce intellectual property rights (IPRs) would be greatly reduced, or totally removed in some cases. The main concern of this stakeholder group is how to achieve and maintain a healthy return on investment (ROI) from their content businesses.
Technology driven changes in the content economy has meant that established business models no longer work as intended, and some may not even work at all in extreme cases.
Therefore the commercial stakeholders have to consider alternate models, which are often developed by newer entrants into their domains. Examples include: Amazon.com in publishing; iTunes/iPod in music; YouTube, NetFlix and Lovefilm in the film / broadcast industry; and eBay in the retail sector.
In this context, it becomes clearer as to why industries like the music business reacted negatively to their changing environment by pursuing a futile strategy of draconian DRM, and legal actions, to try and stem the tide of change.
However, it is becoming increasingly obvious that embracing and influencing these technology driven changes may be the better path to follow for most industries in the long term. DRM and related technologies must be adapted to support newer business models instead of simply trying to preserve the older models.
Governance / legal / legislative stakeholders
This stakeholder group produces and enforces the rules by which DRM has to abide, and its absence would render DRM ineffective in the digital content economy. This group is predominantly focused on creating, maintaining and enforcing the rules, regulations, standards and other constructs that govern the use of content by all the other stakeholders.
It consists of: various social and civil establishments; individuals and organisations responsible for intellectual property laws and regulations, (including governments, international entities, legal institutions, standards bodies and regulatory organisations).
The challenge faced by this group is centred on the need to keep pace with the rapid changes experienced by members of the other stakeholder domains. Major initiatives from this group include the Digital Millennium Copyright Act (DMCA) and the European Union Copyright Directive (EUCD) which seek to address issues raised by content usage in the digital domain.
Consumer / end-user stakeholders
This stakeholder group represent the final link in the content value chain and it consists of all individuals and organisations that consume content in any way, shape or form. It essentially includes everyone, even members of the other stakeholder groups.
Also this group is the main driving force of the digital content economy, and it represents the point at which content is consumed, revenue derived and future markets are defined. Without content consumers the other groups would have no real purpose in this context, and DRM would be unnecessary.
The main challenge faced by this group is that although it may arguably be the most powerful stakeholder group in the content economy, its interests are regularly overlooked or neglected by the other stakeholder groups; and the members do not seem to be fully engaged in their role as bonafide stakeholders in the content economy (except perhaps when they decide to vote with their wallet).
This may stem from the fact that they are still trying to get to grips with life in the inter-networked world of today and perhaps also the conflict of interests they face in their dual role as members of more than one stakeholder domain.
In conclusion, we have seen that DRM is primarily an economic tool that is inextricably linked to the digital content economy. Also the fact that digital technology continues to evolve rapidly means that there is no easy answer to the pressing issues of today without a large-scale cultural shift in the ways of thinking by members of all stakeholder domains.
The future is uncertain, but the indications are that DRM and other related technologies (such as watermarking and fingerprinting) will need to evolve and leave their restrictive past behind before they can take their rightful place as true enablers of the digital content economy and the opportunities contained therein.