[Infowarrior] - Apple's Copy Protection Isn't Just Bad For Consumers, It's Bad For Business

[Richard Forno]

Opinion: Apple's Copy Protection Isn't Just Bad For Consumers, It's Bad For
Business

Apple's copy-protection technology makes media companies into its servants.
Other copy-protection technologies, like Blu-Ray and HD-DVD, are just as
bad, says Internet activist <b>Cory Doctorow</b>.

By Cory Doctorow,  InformationWeek
July 26, 2006
URL: 
http://www.informationweek.com/story/showArticle.jhtml?articleID=191000408

When it comes to anti-copying technology, there are two possible outcomes:
either you have a popular single-vendor system that's bad for the industry
and general public, or you have a multi-vendor system that's bad for the
industry and general public.

Apple Computer's iTunes is hailed as the first really "balanced"
copy-restriction system. Unlike the copy-restrictions built into failed
systems from the likes of Sony, Toshiba, and Microsoft, the
anti-copying/anti-use stuff in iTunes doesn't seem to have deterred the
public from buying iTunes music and the iPods that play it. Indeed, more
than a billion iTunes have been sold around the world. That only amounts to
a couple CDs' worth of tracks on every iPod, but still, that's not bad,
especially in a field where the big success stories to date have been
digital music stores that managed to go out of business without costing
their backers too much.

Steve Jobs and Apple managed to lure the music industry into licensing the
copyrights for the iTunes Music Store even though the Store's
use-restrictions are comparatively mild. There's a bit of region-coding --
you pay a per-download charge based on the country your credit-card is
billed to. There's a bit of multi-use restriction -- only five CPUs can be
registered to a given iTunes account at a time. There are some miscellaneous
restrictions, including ones that are genuinely bizarre, like limiting the
number of times you can burn a given playlist.

Removing iTunes's DRM is pretty straightforward. It's time-consuming, but
it's not too difficult. You just have to burn a CD with the tracks, re-rip
the CD tracks as MP3s, and re-enter the metadata, like title and artist.
This doesn't work as well for the expensive audiobooks Apple sells, which
generally come in chunks too large to fit on a CD.

So far, so good. The iPod is the number one music player in the world.
iTunes is the number one digital music store in the world. Customers don't
seem to care if there are restrictions on the media Steve Jobs sells them --
though you'd be hard pressed to find someone who values those restrictions.
No Apple customer woke up this morning wishing for a way to do less with her
music.

But there's one restriction that's so obvious it never gets mentioned. This
restriction does a lot of harm to Apple's suppliers in the music industry.

That obvious restriction: No one but Apple is allowed to make players for
iTunes Music Store songs, and no one but Apple can sell you proprietary
file-format music that will play on the iPod.

In some respects, that's not too different from other proprietary platforms,
of course. No one but Microsoft makes Word. But there's a huge difference
between Word and iTunes: Word is protected only by market forces, while
iTunes enjoys the protection of a corrupt law that gives Apple the right to
exclude competitors from the market.

iTunes is protected by the anti-circumvention provisions in the 1998 Digital
Millennium Copyright Act (DMCA), itself a law passed to comply with the 1996
UN World Intellectual Property Organization (WIPO) "Internet Treaties." The
DMCA makes it a crime to circumvent "effective means of access control."
That means that breaking the locks off a digital work is illegal, even if
you're breaking the lock to accomplish a legal end.

It's otherwise legal to back up a DVD, or put a song on a home media-server,
or quote an ebook in a college essay. But if you have to break through some
copy-restriction technology to do this, you're breaking the law.

It doesn't even matter if you're the creator of the work the lock controls!
You can't even access your own work on your own terms if you need to break a
lock to do it.

The DMCA makes the kind of reverse-engineering that's commonplace in most
industries illegal in copyright works. For example, in the software
industry, it's legal to reverse-engineering a file-format in order to make a
competing product. The reason: The government and the courts created
copyright to provide an incentive to creativity, not to create opportunities
to exclude competitors from the marketplace.

Reverse engineering is a common practice in most industries. You can
reverse-engineer a blender and make your own blades, you can
reverse-engineer a car and make your own muffler, and you can
reverse-engineer a document and make a compatible reader. Apple loves to
reverse-engineer -- from Keynote to TextEdit to Mail.app, Apple loves
reverse-engineering its competitors' products and making its own competing
products.

But the iTunes/iPod product line is off-limits to this kind of
reverse-engineering. No one but Apple can authorize an iTunes/iPod
competitor, and Apple's not exactly enthusiastic about such authorization
--the one major effort to date was the stillborn Motorola ROKR phone, which
was so crippled by ridiculous Apple-driven restrictions that it barely made
a ripple as it sank to the bottom of the cesspool of failed electronics.

It's easy to see how banning reverse-engineering is bad for Apple's
customers. The ban creates a monopolistic lock-in that invites bad behavior
that would otherwise be checked by competition. Apple has already
demonstrated its willingness to abuse its monopoly over iTunes players by
shipping "updates" to iTunes that add new restrictions to the songs its
customers have already purchased. The business model of buying music on the
Internet is that one buys a "license" for certain uses, but the company that
supplies the product to you can revoke parts of the license, and there's
nothing you can do about it. This is just abuse.

Worse still: Apple's competition-proof music makes switching away from its
product expensive for Apple's customers. The world of consumer electronics
changes quickly and you'd have to be a fool to believe that no one will ever
make a superior portable music player to the iPod. iPods and other walkmans
have a low price-point and turn over often -- it's no coincidence that
Apple's iPods are made out of materials that scratch if your breathe on them
and look like they've been through a rock-tumbler after a couple weeks in
your pocket -- which means that you're likely to be in the market for a new
one every year or two.

So say that in 2008, Creative finally manages to nail an iPod killer just as
you're ready to retire your 2006 iPod Nano. At $180 for the new device, it's
a no-brainer to pick one up on your next Amazon run or duty-free trip.

But say you're the kind of iPod user who also buys the occasional iTunes
Music Store song. Just one or two a month, maybe 20 a year. If you do that
every year from the year the Music Store launched, you'll have 100 tracks by
2008. That's a $99 investment in music that only plays on the iPod/iTunes
combo. Creative won't play Apple's music, and if Creative tries to do so,
they'll find themselves in legal jeopardy under the DMCA, which would give
Apple the right to sue them for trying.

At 20 tracks a year, you add 50 percent to the cost of switching away from
an iPod in five years. In ten years, you double the cost. And if you buy
more than 20 tracks a year -- or splurge for audiobooks, full albums and
other high-ticket iTunes Music Store items -- you'll find yourself in hock
for thousands of dollars that you'll flush away if you change vendors.

Sure, you could conceivably burn and rip all that music (except the
audiobooks, which will come out mangled into 70-minute chunks) if you want
to spend a couple days with your burner, and don't mind retyping all that
tedious metadata. The more music you have -- the better a customer you've
been for the iTunes Music Store -- the more onerous this task becomes.

Incidentally, you may have heard that Creative has finally decided to
enforce one of its bogus patents against Apple (hierarchical menus on
digital music players -- what thicko Patent Inspector considered that to be
"non-obvious to a skilled practitioner of the art?" I'd give long odds that
if Creative prevails, it will ask for a license to play iTunes music on its
players as part of the settlement.

At the end of the day, though, we customers can always vote with our
wallets. That's what many of us have done: P2P file-sharing of infringing
music is the fastest-adopted technology in the history of the world. Even
loyal iTunes customers are not filling their 10,000-song iPods at $0.99 a
track (nor does the average 10,000-song-iPod-owner have a thousand CDs
waiting to be ripped at home). Creative Commons-licensed music, public
domain music and other freely sharable content accounts for some of those
hard-disk sectors to be sure. But the customer has decided, by and large, to
avoid Apple's lock-in by not buying anything at all -- they've joined the
majority of Internet users in decided that copyright infringement is your
best entertainment dollar.

The music industry doesn't have the option of avoiding commercial decisions.
They have to sell music -- that's what they're in business for --and that
means that they have to go where the distribution channels are. The biggest,
most successful, most powerful of those channels is Apple's. Apple has sold
more than a billion of the music industry's tracks through that channel, and
it controls it from top to bottom.

The industry discovered this the hard way last year when Warner Music's
Edgar Bronfman, Jr. proposed a differential pricing model for iTunes -- more
than $0.99 for front-list titles, discounts for the backlist. I don't like
the sound of that much, but the important thing is what Steve Jobs thought
of it. He hated the idea. It died.

The CEO of one of the largest music companies in the world went to a mere
retailer and asked for the tiniest flexibility in its marketing plans and
was all but laughed out of the board-room. Why not? If Apple doesn't want to
give in to Warner's terms, what's Warner going to do? Withdraw its iTunes
licenses? Sell exclusively over Rhapsody or Yahoo Music? Lots of luck
selling music that won't play on the world's most popular music player.

That's the real irony. The music industry provided the bait to Apple, in the
form of the regulatory monopolies it receives over its copyrights. Apple
hijacked that monopoly and used it to hook us.

Warner can't authorize Real or Yahoo or Microsoft to break Apple's copy
restriction in order to enable its own music to be copied onto a new device.
Even though they hold those copyrights, they have lost control over their
destiny.

It's not just Warner, either. Through 2005 and 2006, Sony BMG music faced
global lawsuits after it deployed millions of CDs infected with a crippling
anti-copying technology called XCP that used a rootkit to disguise itself.
Researchers who decompiled XCP noted that it contained code from a program
that is used to circumvent iTunes copy-restriction. Many have suggested that
Sony chose its cowboy DRM vendors based on their willingness to put Sony's
music on Apple's players without going through the iTunes Music Store.

European nations such as France, Norway and Denmark have announced
regulatory and lawmaking interventions in the iTunes business model, often
with the quiet approval of the record companies, who hope to force Apple to
open iTunes to other DRM vendors.

Is that the answer, then? Standardized crippleware that can be implemented
by all comers? There are lots of these efforts underway, from the well-known
(Blu-Ray, HD-DVD) to the obscure (Coral, the Broadcast Flag, DVB-CPCM).
These specifications are hammered out by multi-party consortia, with
oversight from the entertainment industry. I've attended my share of these
meetings and "oversight" is putting it mildly -- the entertainment industry
runs those consortia, shouting where necessary, threatening to withhold
content from the platform, even (in the case of the Broadcast Flag),
threatening to complain to powerful Congressional Chairmen.

And therein lies the rub. Steve Jobs really doesn't care how many CPUs you
play an iTune on, or whether you burn a playlist seven or 10 times. He wants
you to get locked into iPods, not fall prey to some pie-in-the-sky
pipe-dream where "consumers" pay for "features" like pausing a track or
playing it in a different country. Steve Jobs's crippleware exists only to
lure the entertainment industry in, not to control you in any meaningful
way.

But where you have a multi-party negotiation, you have a much weaker
bargaining position. At the Broadcast Flag meetings in Hollywood a couple
years ago, the studios caused a near-meltdown by announcing, four-fifths of
the way through the process, that they weren't interested in ever approving
single-vendor DRMs from Microsoft or Philips, but would welcome the giant,
brawling consortia like 5C and 4C, whom they could play like a fiddle.

Look at Blu-Ray and DVD-HD, where you have two competing consortia, for a
view of how bad this can get. These two consortia have spent the past
several years locked in a race to the bottom, competing to see who could
announce the least-capable device and therefore command the lion's share of
Hollywood films licensed for its platform. The battle came to an end when
Blu-Ray added the most comprehensively dumb feature to its spec:
region-coding, something that everyone agreed had been a miserable failure
with old, standard DVDs.

Ironically, these consortia DRM aren't any better for the entertainment
industry than the single-vendor systems are. A DRM designed by the studios
is a DRM that is destined to fail. This is an industry that believes in
suing its customers. That believes in frisking moviegoers and patrolling the
aisles with infra-red goggles. That characterized skipping commercials on TV
as theft (though "a certain amount of bathroom activity would be
tolerated"). That believed that the VCR was "the Boston Strangler of the
American film industry." No matter how many smart, savvy execs there are
working within the entertainment juggernauts, the organizations themselves
are constitutionally incapable of designing a distribution platform that
anyone actually wants to buy.

So they sink their money and time into these dead-on-arrival systems, and
lose money (at least Steve Jobs cuts them the occasional check). And those
customers who get suckered into buying their devices end up with the
consumer electronics equivalent of toxic waste, crud that treats its owner
as a suspect and only grudgingly allows the least functionality.

There's no good answer to designing a "good DRM." Or rather, no DRM is good
DRM. iTunes is instructive again in this regard: Apple sold a billion tracks
in three years in spite of its DRM, not because of it. No Apple customer
bought an iTune because of the DRM. What's more, every track in the iTunes
music store can be downloaded for free from P2P networks. Apple proves that
you can sell music without DRM all day long -- all adding DRM to Apple's
music does is give Apple the ability to abuse its customers and its partners
from the labels.

That's a lesson Yahoo Music has taken to heart -- they're abandoning DRM,
shipping MP3s, and putting their engineering effort into producing a
superior product.

Cory Doctorow is co-editor of the Boing Boing blog, as well as a journalist,
Internet activist, and science fiction writer.