Publishers And DRM

Last week I wrote one of my semi-regular rants about the publishing industry and their bad choices. Yesterday, Charlie Stross, a prominent SF author (Accelerando, Glass House, Halting State, Rule 34, and others) wrote a provocative piece on publishers and DRM. Stross's thesis is that the biggest threat to publishers is not piracy but Amazon.com.

Amazon, says Stross, has already captured about 80% of the ebook retail market. That didn't matter a short time ago when ebook sales amounted to about 1% of the publishing market but now ebooks account for somewhere between 20% and 40% of the market and we can, of course, expect that figure to continue growing rapidly. Meanwhile, Amazon is ruthless in the pressure it exerts on publishers for favorable pricing and discounts. This means that they can sell ebooks at very competitive prices and therefore strengthen their near monopoly while at the same time earning more money.

What's this have to do with DRM? We all know the usual arguments against DRM:

  • It doesn't stop piracy (at all).
  • It punishes and inconveniences honest buyers.
  • It tells the publishers' customers that the publishers consider them criminals.
  • It can cause legitimately purchased material to become unavailable when resellers go out of business and abandon their authorization servers.
  • And on and on and on.

Now Stross has another argument against it. By insisting on DRM the publishers help Amazon lock in customers to the Kindle platform and therefore reinforce Amazon's monopoly. This in turn gives Amazon the ability to demand more concessions from the publishers until they are forced out of business.

If publishers were smart, they'd get rid of DRM and maybe even offer customers who can demonstrate that they own an ebook with DRM an unencrypted copy of the book. That would, at one blow, eliminate Amazon's lock in and perhaps—perhaps—help break Amazon's strangle hold on the ebook market. Sadly, of course, the publishers aren't smart and will doubtless continue to insist on DRM until it's too late.

Actually, Stross says that many of the publishers do recognize this but that they are all now part of large media conglomerates with many levels of authority above them who most certainly do not understand publishing and its realities. That's too bad because everyone—except maybe Amazon—is going to suffer from this shortsightedness. Customers will suffer from the inconvenience and lock in that DRM causes, and the publishers will suffer eventual extinction brought on by their continued bad choices.

This entry was posted in General. Bookmark the permalink.