Digital Rights Management (DRM) and CRM

Steve Jobs wants owners of rights to digital assets to give it up.

He may be right -- for him. And he may be right for the industry, provided Apple's iTunes site remains such a hit among consumers. After all, peer-to-peer networks sharing digital media files provide zero royalties to the IP owners. With Jobs' vision, it may well be that enough people will flock to iTunes (or other legitimate sites offering digital media) and to "open" iPods to unleash a pile of cash for everyone.

The observation among many music lovers is that they want to reward musicians -- not necessarily labels or producers. In this scenario, Jobs' view wins.

Others just want to get away with sharing files for free as though that makes them cool to their friends. Not sure how Jobs' view helps here. Without DRM, people will still have to pay for legit copies of music -- if you copy the files, you're still breaking the law. Some people just don't care about that.

On the other hand, what would happen if what we shared became as important as the music? Suppose we had a really simple, robust way to create and share playlists? To find "similar enough" playlists to help us identify new music we'd probably like? And suppose Apple did all this? Would people be willing to pay for music managed this way?

What I'm getting at is the value added by the network of music lovers. There's a power law advantage to hanging out with lots of people online. If they're like you, you can enlist them in a cause. If they're different enough from you, you can learn from them (this is a key part of Granovetter's argument about weak ties, see more at Wikipedia here). The more meshed your network, the shorter the time is for someone to get value from your network.

So, maybe the thing that really matters here for owners of digital media is to create a new way of adding value to their stockpile of media assets, not by controlling copying, but by encouraging sharing via a site that lets everyone make some money off the method for describing, collecting and sharing the media.

PS On Thursday, a study that surveyed 2600 Americans concluded that most people won't shoplift a DVD, but most people also didn't consider downloading copyrighted moved a "very serious offense". Click here for more information on the study as reported on ZDNet.