About this issue
Alternatives to the techno-legal content protection paradigm
Vural Ünlü, consultant and author of a book on "Content Protection – Economic analysis and techno-legal implementation" starts from the assumption that loss of revenues in the music industry is indeed to a significant extent due to copyright infringements. Based on sound knowledge of network economics he argues that there are business models to fight piracy and to regain revenues without strong technical protection measures (TPM). Responding to consumer needs by increasing the utility of products and services is key. Two strategies are discussed: one in which side effects of piracy are exploited, and a second in which content degradation is suggested, i.e. ways to increase the utility difference between original and pirated products by either combining media products with services difficult to copy, by increasing transaction costs for illegal offerings, or psychological devaluation of pirated goods.

While Ünlü provides theoretical background why increasing utility makes DRM protection less necessary, Tobias Regner and Javier Barria, both researchers at Imperial College London, have investigated a case in point: Magnatune an online music label with ca. 200 artists on contract and at the same time an online music shop. What makes it specific is first that the online store allows unlimited streaming or, in other words, informed choice before purchasing, and second that buyers can choose the price they are willing to pay within a range from US $ 5 to 18. The researchers performed an empirical analysis based on data provided by Magnatune and found among other things that buyers pay considerably more on average than the minimum of US $ 5. They conclude that this consumer behaviour is due to the consumer friendliness of the service, encouraging people to reciprocate and thus to pay more than required. They admit that this finding refers to a niche market and "cannot be easily applied to the mass market".

CC and TPM
Jordan S. Hatcher has worked at the AHRC Research Centre at the University of Edinburgh on a study exploring the possibility to use Creative Commons licenses for public sector information. One of the research questions he investigated was if CC licenses are compatible with technical protection measures. For the INDICARE Monitor he expands on this subject very cautiously. First he investigates password protected authenticated environments (e.g. intranets, virtual learning environments, digital repositories) and concludes that CC licenses do allow password schemes. Second, he analyses TPMs attached to actual works in order to guarantee integrity, tracking of use, and prevention of commercial use. He concludes that cautiously applied TPMs "can be used to enhance the attractiveness of CC licenses". What is also worth highlighting is that public sector organizations obviously have different needs than individual authors a perspective that is often not taken into account in discussions on CC.

FairPlay plays fair from the point of view of French competition law
Natali Helberger thoroughly discusses an interesting law suit in which a French media company whose activities include running online music stores wanted to get access to Apple's FairPlay DRM system in order to be able to offer its music in a format suitable for the iPod. The question was if Apple could be forced on the grounds of competition law to license its technology to a media company interested in increasing its customer base. The legal concept called "Essential Facilities Doctrine" was the legal lever used to open access to Apple's DRM system. It did not work out for the media company. This article, apart from being an interesting piece of legal reasoning, can also be read as a chapter in the standards war. For INDICARE of course the consequences of these strategies and battles for consumers are of utmost interest and consequently addressed in Natali's contribution.

Review of OECD studies
The Working Party on the Information Economy (WPIE) of the OECD has published four reports on digital media dealing with scientific publishing, music, online computer games and mobile content. The studies aim to describe these sectors in terms of changing market structures, business models, value chains etc. DRM is not a central issue in these studies. Nevertheless we wanted to find out what stance the OECD takes in these matters. Philipp Bohn has taken a closer look and discusses what the OECD has to say about DRM. In the field of scientific publishing, especial Open Access publishing, the OECD does no see a role for DRMS. In music markets DRMS may play an important role protecting intellectual property rights. With respect to mobile music policy issues related to DRM are highlighted (e.g. infrastructure, interoperability). In the study on computer games DRM has not been an issue – although it is mentioned once. The OECD admits that further studies into DRM may be required, and in fact, meanwhile another division of the OECD, the OECD CCP Secretariat of which the European Commission is an active member – CCP meaning Consumer Policy Committee – has prepared an issue paper on DRM, which however is not yet publicly available – but watch the following space: http://www.oecd.org/department/0,2688,en_2649_34267_1_1_1_1_1,00.html.

About the author: Knud Böhle is researcher at the Institute for Technology Assessment and Systems Analysis (ITAS) at Research Centre Karlsruhe since 1986. Between October 2000 and April 2002 he was visiting scientist at the European Commission's Joint Research Centre in Seville (IPTS). He is specialised in Technology Assessment and Foresight of ICT and has led various projects. Currently he is the editor of the INDICARE Monitor. Contact: + 49 7247 822989, knud.boehle@itas.fzk.de

Status: first posted 28/10/05; licensed under Creative Commons
URL: http://www.indicare.org/tiki-read_article.php?articleId=151