30 Days of DRM - Day 06: Interoperability (Public Protection and Markets)
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Thursday August 24, 2006
The interoperability problems associated with DRM have emerged over the past year as a focal point for debate with legislators and regulators in Europe beginning to intervene to address the issue. The interoperability concerns arise from the fact that DRM'd content is frequently linked to specific hardware, leaving consumers unable to transfer the content from device to device. For example, Apple iTunes uses a technology known as FairPlay to limit consumers ability to transfer songs that they have purchased to devices other than the iPod (as well as limit the number of copies and uses of the download), while services such as Napster and Puretracks use a Microsoft-supported DRM system that will not play on an iPod. The end result is lock-in (literally) as consumers find themselves tied to a specific hardware device with the cost of switching now including the loss of their investment in new content.
Even the industry has begun to acknowledge the problem. It was much discussed at an OECD conference in Rome earlier this year and Yahoo! has expressed its frustration with DRM. Of course, those rejecting the DRM-based approach are finding great success - witness the Canadian music industry, where the large independent labels have left CRIA and largely avoid DRM, as well as eMusic, which offers "clean" MP3s, and has grown into the world's second biggest music download service.
Regulators have also become involved as concern over consumer fairness and marketplace competition mounts. France toyed with legislation earlier this year that would have mandated that Apple reveal technological specifications to its competitors so that they could design compatible devices. As a result, songs bought on iTunes would theoretically play on any digital music device. Officials in several Scandanavian countries are now examining similar concerns.
It is important to understand that this interoperability problem is not solely a product of DRM. Rather, it is the result of combining DRM with anti-circumvention legislation.
DRM on its own raises compatibility issues but it is a safe bet that competitors will be able to patch the problem by building tools that allow for compatibility. Once anti-circumvention legislation is added to the mix, the competitors are effectively locked out, since developing the compatibility tools will likely break the law.
How to address the problem? One possibility is the early French approach of mandating disclosures of technological specifications. That might help address the issue, but arguably interjects government regulation too far into mandating technical requirements. A better approach would be to establish a legal framework that guarantees the "freedom to tinker" such that competitors would be free to develop interoperable products without fear of legal liability. This would require an explicit exception to the anti-circumvention rules and conceivably a provision within the Competition Act to bolster that freedom by preventing abusive practices designed to establish unfair hurdles to interoperability.
Thursday August 24, 2006
We want to enhance competition and investment in this country, and this is why we adopted this policy back in 2008 for the AWS spectrum. Let me say that the price went down by an average of 11% since then, and we will continue this way with the 700 megahertz spectrum. We launched consultation with the industry to make sure that we enhance competition and provide better choice and better rates for our consumers.