West coast samaBlog correspondent Calzone sent this missive in from the field. I thought you should read it:
I was reading The Economist, who like so many other reporters over the past week, chose to focus on the promise of the iPad to reinvigorate the dying print industry. Of course, the DRM question you posed is crucial to their notions of any such reinvigoration.
I can’t speak for all consumers, but this one says: ‘enough!’
I don’t give half an anorexic rat’s ass what happens to the content publishers. Really, I don’t. The internet genie is out of the bottle and it ain’t going back in. Millions of bloggers are perfectly happy to provide their analysis and opinion on current events FREE of charge. With the exception of a handful of boutique news outlets, the media do not add significant value to the reporting of current events. Certainly not enough value to pay for it. It was hardly enough value to stomach putting up with ads.
Here’s a thought experiment: the average consumer subscribed to one or two newspapers. Now that you can essentially get any newspaper delivered via the internet, let’s be charitable and assume people were willing to pay for their news. It’s reasonable to expect that the average consumer nationwide will gravitate to one or two newspapers from around the entire world. Maybe three or four. Over a short while, it’s also reasonable to expect that the result of that would be that there are maybe 3 major viable alternatives for each of the three or four papers a person subscribes to. The market ends up supporting a max of about 12-16 major papers nationwide. So even if the iPad or any other device is some kind of savior to the print industry, I wouldn’t count on it to be a panacea for your company.
But it’s worse than that. We don’t want to pay for your content. Reuters and AP newswires are good enough. Local, decentralized reporting is good enough. PBS and BBC are good enough. For in-depth analysis and opinion, we’re going to go straight to the authors we care about and can afford. That means we’ll mostly gravitate to blogs we can read for free. Maybe there’s a market for premium blogging ala Salon.com. But I sure ain’t gonna pay the Boston Globe or even the NYT for access to their columnists. Dream on. The best columnists end up WILL going indie, or at most migrate to something like Salon.com.
Consumers are fed up with endless cable bills and phone bills. We’re already paying THROUGH THE NOSE for access to media over cable and for having the flow of bits in and out of our homes and devices. The Subscription Economy is already at its limit; in fact, it’s past it. People are actively seeking ways to circumvent paying what they currently pay for both content and connectivity. The average US household budget simply cannot sustain the content utopia envisioned by those who seek to be content gatekeepers and middlemen. There are far too many middlemen as it is between me and the producers of content and they all want an ongoing piece of me each month. Bit-schelppers are charging WAY too much for too little and trying to charge more for access to specific content types, while content producers and publishers are tying to find ways to make even more obscene gobs off the content they distribute than they did when it wasn’t digital.
So back to the iPad.
If the point of the iPad is to provide a platform that primarily gives for-pay access to locked-down reading material, then fuggedaboutit, I don’t want one. The last thing I need is to PAY to buy into a platform that requires me to PAY more just to read stuff. I’m happy to PAY Apple for a mobile computing platform that’s as capable as my MacBook Pro, that I can install my own software on, that I can use to download stuff and consume the stuff I download, that I can use to copy and paste content and remix content to my heart’s content, that I can use to save ‘clippings’ of stuff that interests me, and yes, that I can use to SHARE stuff I’m interested in, copyright or not, with my friends just like I can share newspaper clippings and pages or share books.
All these news types, text book publishers and other publishers are seeing stars suddenly. ZOMG, the iPad is going to do for print what iTunes did for music. People will pay! Dream on. Sure, if I owned an iPad, I would probably buy a good novel to read on the plane. It’s money I would have otherwise spent at the airport bookstore. I would use the iPad to go read blogs and free news. But I’ll be damned if you think I’m going to have an NYT subscription just so I can read your paper in near-full broadsheet quality with fancy fonts. Shit, I’ll just grab the abandoned copy of the paper I found on the seat here in gate 4B and read it old-skool. The digital revolution is NOT about recreating a literal virtual model of analog content.
But that’s the crux of the problem with the iPad. Sure it’s gorgeous, sure it’s fast, sure it’s magical. But if it’s gonna basically be useless without paying for content subscriptions, it’s doomed among people like me. Even more so if content is going to be restricted by DRM or other protections (like password protected PDFs) preventing me from doing what I want with it, or if said content will expire 3 days after buying it.
As you said, this business model is bearable on the iPhone, because its primary function is to be a great phone. We can overlook such shortcomings. We can pretend that it’s ok to impose restrictions because AT&T is trying to protect its fragile network. But that is not to say that we haven’t always been hoping and pining for a day when such restrictions would be lifted. We ALL want the iPhone to be more open. We just live with it because we’re willing to make that sacrifice to have an iPhone. But let’s be clear: it IS a sacrifice and we all feel it and know it, and we all half-expected that model to eventually go away, not become more widespread.
In the end, what will happen is that content producers will have at most one degree of separation from content consumers. There will be stables of premium creators. Reputable places where consumers can find content of a certain quality, frequency, degree, and persuasion. People will be willing to pay for access to those creators. There will be far more who are independent and connected directly to their consumers, whether ad-supported, totally free, donation-supported, or pay-walled. Reuters and other primary and open sources of news will live on, and big networks, like CNN will live on and help support them. Current headlines and raw news will remain ad-supported/free and widespread.
Try as it might, Apple’s desire to be a primary gatekeeper for all content will ultimately fail if it also tries to regulate that or take too big a cut. Long term success for the iTunes App Store model can only come with opening the floodgates and taking a modest cut from those who do charge and requiring no money from those who don’t. The iPad is either going to adapt to that reality and become a viable platform, or it’s going to try to impose the restricted authoritative vision Apple has and doom the iPad to expensive toy of the month.
No, the iPad itself is not really expensive, what makes it expensive if the cost of ownership. I think few or none of us are interested in seeing the razor blade / printer ink cartridge business model being applied in every single possible market marketers can come up with.
One Response to “A DRM Rant”
February 1st, 2010 at 1:19 pm
While I agree with what Calzone is saying, I think he’s omitting or trivializing something vital. Consider a user who buys the iPad (or iPod, for that matter) and then goes out of his way to only use free software and services on it thereafter. As Calzone points out, users like this are clearly not why the New York Times is investing in the platform. Such customers are totally useless to content providers. But, and here is the crucial point, they are not useless to Apple. Sure, Apple may not make as much money from those customers from their cut of a content deal (whatever that is), but they still paid Apple for the device, and their using it has a decent chance of generating a sale to someone that user knows.
So, if Apple sets up a system that lets content providers erect a pay-wall that make them (and Apple) profit, from Apple’s point of view that’s great! If, on the other hand, some rogue hippies take advantage of the device to build some free-information utopia, from Apple’s point of view that is also great. You can tell this is true by virtue of how Apple set up it’s fee structure for the app store. The message to people who want to give away their apps for free is “that’s cool, feel free to use our infrastructure at no charge”. They really didn’t need to do that, and wouldn’t have if their sole desire was to create a subscription driven platform. They could have said “if you want to use our infrastructure for your free app, you need to pay us a whatever dollar fee to register your app”. Or “screw you, no free apps”.
And yet, they also did not say “hey, anyone can download and install anything they want from anywhere they want”. Apple clearly has a vested interest in allowing providers to create pay-walls, and make sure they get a cut when the provider does so. It’s not in Apple’s interest to prevent this.
But, it is also not in Apple’s interest to prevent free access either. They gain nothing and lose a lot by creating an ecosystem that is subscription only.
The future of the iPad will depend a lot on Apple’s skill at dancing this line, and in how the customers (and, as important, app developers) push in both directions.
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