The risk of too much risk aversion

I don’t like DRM. Let me tell you why:

But first, “What’s DRM?” I hear you ask (if you didn’t, you can skip this paragraph). DRM stands for ‘digital rights management’. It is the ‘feature’ that stops you copying a DVD directly from one disc to another and stops your ultraviolet movies from working when you travel abroad.

DRM stops you from using media in a way that makes it easy for people to pirate movies, TV shows and music. At least that’s what we’re told. But despite DRM, the internet is awash with the latest movies and TV shows. Ironically, music, which everyone was ever-so worried about in the early 2000s, is no longer on the danger list; it’s actually reasonably difficult to find pirated music these days. If you want to listen to something, you’re much more likely to use Spotify, Pandora or YouTube than to try to poke around in a dodgy website looking for it.

But movies and TV are the area where the protection is happening. And it’s this area which causes me the most anger and frustration. Let me compare the approach of two groups: Google and Ultraviolet.

Ultraviolet is a code which you get with some DVDs and blu rays (but frustratingly, only some) which lets you download and stream a digital copy of your movie. At least that’s the promise. But there are a lot of caveats:

  1. You have to buy a physical copy, nullifying the real benefit for both user and distributor of getting rid of inventory and stock;
  2. You are explicitly not obtaining a promise that you will always be able to get your digital copy – just for as long as the studio can be bothered to let you have access.
  3. Unlike with a DVD or blu ray (or CD, or LP or 8-track), if you take your movie abroad with you, it will not work. You can download it before you go, but if you have finite hard disk space, or if you want to watch it on your phone or tablet, you cannot once you’re out of your country.

Google’s ‘Play Movies’ (which also sells TV shows) is very similar. I am disappointed every time I find a DVD or blu ray that is cheaper than the digital copy (because that is blatant profiteering: a shop, manufacturer and distribution logistics are all being paid for as well as the royalties, so physical copies should always be more expensive) but it is better in terms of geography.

If you have a Google account – let’s call it an American one for the sake of argument – you can visit your friends in France and show them the film you bought just as if you’d carried the blu ray with you. And if you fancy buying another movie while you’re there, you can do that too.

So why are Google and ultraviolet behaving so differently? One possibility is that ultraviolet has to be ultra-conservative in order to convince as many studios as possible to support it. But that very conservative approach is counter productive. I have, on more than one occasion, downloaded a ripped copy of a movie I own on DVD and ultraviolet, not in order to distribute it, but in order to use it in a completely reasonable and law-abiding manner.

What ultraviolet does, by being too conservative, is push users into the hands of pirates. And once a law-abiding, paying customer discovers how easy it is to get movies illegally, temptation is much closer. Without the ridiculous rules around ultraviolet, DVD and blu ray logistics might have become a thing of the past, but as it is, blu rays are here for the foreseeable future, Google and Apple will continue to make a fortune and pirates will continue to have a raison d’etre.

Risk managers are important when companies are reckless, but their true value comes when a company is being too conservative, and damaging their bottom line and future flexibility as a result.

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