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October 29, 2004

Tivo Auto Delete PPV

Yesterday I mentioned a set of articles on DRM, including Due Diligence's three laws of DRM. Here's his three laws again:

  • Copy protection DRM always destroys end user value, in both convenience and robustness. When you see DRM in a business plan or analysis, it is always there to benefit someone other than the end user. Find out who, it will indicate where power lies in a content value chain.

  • The mere presence of DRM indicates a failure to deliver end user value. If the information object were to lose value when extracted from the bundle or service from it was derived, DRM would not be felt necessary. Therefore the presence of DRM suggests a vendor that is behind the curve, failing to find a new value to deliver as their chokepoint disappears in the digital world.

  • DRM almost always means there is trouble afoot for aggregators ('infomediaries'). If it's an aggregator inserting the DRM, their value added is in question. If it's information originators mandating DRM, then they feel they can damage the aggregator's value with impunity, and will likely try to drive end users' attention to themselves.

I won't rehash yesterday's article, but I pointed out that bad implementations of DRM is a more accurate descriptor particularly when it tramples of the rights of people who legally own copyrighted material. Well, PVRBlog has example #1A of bad DRM and it obeys Tim Oren's three laws perfectly. Just as importantly as the article on PVRBlog is the comments from users, who are generally pro-Tivo for the most part.

Tivo's in a hard spot so I can't blame them too much for their decision since litigation against a deep pocket company is counter-productive to them getting critical mass for their business. However, Due Diligence once again is proven correct, and if there is any question about Tivo's relationship with content providers, see Rule #3. They are getting squeezed like toothpaste.

Posted on October 29, 2004

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It isn't like the content delivery intermediary is voluntarily adding DRM to make the consumer's life more dificult. The content provider's are requiring DRM, as they have for a long time. We just have more ways to share the content than before, which increases the loss of revenue risk to the content provider.

We can whine all we want, but how do the movie studios prevent that one unprotected copy of an HDTV DVD movie from being the first and last copy they sell? Change the business model? Drop prices to the point where pirating isn't worthwhile?

Posted by: john mcclenny at October 31, 2004 05:42 AM

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