Downloads and Licenses

Spotted via Furdlog:

Tom Waits’s publisher claims that revenue from iTunes downloads is revenue from “third-party licenses” and trigger a higher royalty percentage than revenue from sales of physical product. Warner Music Group says that iTunes downloads are like copies of CDs.

iTunes downloads come with DRM that’s not so difficult to break, but “breaking” the DRM reinforces the metaphorical point that DRM is an add-on to the underlying product. I’ve always associated DRM with licensing: DRM is code = law.

Suppose, though, that WMG is right; we who download from iTunes really do “buy” the “thing.” That sounds like a good thing — we buy what we pay for, whether digital or analog. But is it?

iTunes downloads come with DRM. So, given the accompanying DRM, if we’re “buying” the download, what we buy isn’t really the equivalent of a CD or vinyl. And it’s not recording + DRM, either. DRM is integral, rather than a legal or technical add-on. It’s designed in. The DRM-limted-iTunes-download is a new and different thing, not the equivalent of a CD but the equivalent of a DRM-limited-use-CD.

What difference might this make? DRM that’s an add-on might be circumvented or enforced, and we might continue the ongoing conversation about the legitimacy of the DMCA. We have rules about what constitutes valid licensing (even if software developers have pushed the limits of those rules), and lawyers and policymakers know how to have conversations about those rules. But we don’t have good rules for what constitutes legitimate design, and we’re having a very difficult time coming up with the ground rules for a conversation about them. For example, DRM that’s part and parcel of the product opens the door to developers’ making claims about innovation and evolution in technology markets that echo arguments by Grokster’s supporters.