The False Promise of Social DRM

Are you aware of the differences between printed books and licensed eBooks? In the American book market, the doctrine of first sale establishes fundamental rights for purchased books. This doctrine lays out what an owner of a book can do with a book and affirmatively grants owners the right to lend books, give books to others and to resell books, among others; this allowed the flourishing of secondhand bookstores. These rights with physical books set expectations among many users that eBooks should be able to be resold to others, lent freely and as transferable as printed books. Digital rights management (DRM) allows for powerful scenarios that printed material does not – such as the ability to make many loans of an eBook at once. But the fact that eBooks are licensed content rather than purchased content is not intuitive to many. The casualness with which many users access free software, and with which programs are “lent” to others, also perpetuates confusion about user rights with eBooks. Nor does it help that digital rights management is only noticed by users when something is going wrong and it’s not working.
Much has been made of “Social DRM” schemes – most typically adding watermarks to the pages of an eBook – as an alternative to digital rights management solutions. In most cases, watermarking places a purchaser’s name, and sometimes other information, about the purchaser on one or more of the pages of an eBook, to identify the purchaser and to designate that only the purchaser has the rights to view or use the content. It’s very tempting at first to think of watermarking as an ideal, low-inconvenience means of content license restriction – there’s no logic or addition required to any viewer, no additional software required, and the restriction on use and transfer travels within the content itself.
However, watermarking ultimately does not stand up to scrutiny as it has the following key limitations:

  • Content is forever restricted to legal use by only the person or entity that is named in the watermark. It may not be lent, sold or given to anyone else.
  • Content has no mechanism for permission enforcement, save for the potential shaming of the person named in the content – this is an extremely low bar, and doesn’t even serve to “keep honest people honest” in a world where everyone copies files and passes these around without concern.
  • Content is forever branded with the name of the content owner. This removes the ability to purchase an eBook in anonymity – a reader’s history of purchasing that content is now tied to that content forevermore and irrevocably.

These problems have stunted the eBook market in many locations. One illustrative example is the eBook market situation in Poland. Arta Tech distributes eBooks in Poland as well as offering the inkBOOK open e-reader. Paweł Horbaczewski, the president of Arta Tech, offers the following caution about what has happened with the eBook market in Poland:

Hard DRM standards have been rejected by the Polish publishing market mostly due to hard entry barrier for end users (no localized support). Since the year 2011, over 95% of digital content available on Polish market is either completely DRM free or relies on various watermarking systems. Most publishers hoped to stimulate eBook market growth, reduce market development costs and accommodate existing users of individually imported Kindle e-readers. At the beginning it worked as intended, mostly because of the reduced entry barrier for new eBook users. However, after an initial period of rapid growth, eBook sales started to become stagnant.
Interesting fact is that publishers were so strongly convinced by the first eBook vendors that Kindle (despite lack of support from Amazon) was the key to developing the market, that they started investing in converting their content not only to EPUB standard but also outdated MOBI format that could be served only with watermark. Due to licensing issues, Amazon DRM could not be applied and Adobe DRM could not support MOBI. Eventually, it turned out that end users who buy individually imported Kindle devices, or Kindle devices brought by trading brokerage agents to Poland from Mexico, Brazil or Japan, are not necessarily using Kindle because they love Amazon quality of service or prefer to read English books. Those users, in huge majority, seek “free” content and convert it to MOBI using Calibre software. Obviously, it became clear that this is not the target audience for any kind of paid services any time soon.
Additionally, it turned out nobody was willing to invest in infrastructure for tracking copyright abuse of watermarked content (so it has no real value as rights management). eBook prices are still high, the same level, or sometimes even more expensive than paperback versions (not including special promotions). On one hand, it’s because of high 23% VAT tax for eBooks. On the other, publishers tend to include risk of “unsanctioned redistribution” into price (statistically each sold DRM-free or watermarked eBook is given to and used by 10-20 persons, even more books in MOBI format).
Lack of a reliable rights management solution has also prevented quick development of alternative business models other than simple selling files in multiple formats. This actually created another entry barrier for readers not comfortable with modern technology, as eBooks are not sold as a books and consumed by end users as a book – they are sold as EPUB, PDF, or MOBI files and end users need to determine what to do with a particular file on their own. At the end, stagnant sales growth (eBook market is still even blow 3% volume of entire book market) does not motivate publishers to invest in digitizing all of their offerings. Sometimes, even some of the titles remain unavailable as the market can not ensure reliable copyright protection, or the publisher is not willing to invest in prepayments for additional digital rights licences.

So we see that watermarking, which is supposed to enable eBooks to be easy to read, comes at a high price: a literal higher price on social DRM and DRM-free content than the equivalent printed version!
The irony here is that Social DRM, instead of encouraging the socialization of information and knowledge, actually discourages authors and publishers from making eBooks widely available. Thankfully, all hope is not lost. Advances in digital rights management software continue. The Sony DADC User Rights Management System (URMS) allows content providers to extend to users a full suite of transfer rights that enable eBook experiences that closely mimic the positive aspects of printed books. This includes the ability to loan out one’s eBooks, to give away eBooks one no longer wants, and to resell eBooks – while maintaining content security against duplication.
Watermarking and other simple solutions may seem useful, but ultimately restrict the transfer rights of eBook users. Instead, these perpetuate the idea that eBooks, once purchased, are locked forever to a specific named individual. Ultimately, this does a great disservice to our users and to our ecosystem. Better to provide readers with the flexibility to work with eBooks in a manner they are familiar with, I believe, rather than adding restrictions to content in the pursuit of a false simplicity.
If you have questions, or want more information about Sony DADC URMS, contact us.

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