Study: cut DRM and people may pirate less

Curbing piracy in the digital age is an uphill battle for rights holders. The sheer amount of illegally reproduced music, movies and video games available on the Internet makes shutting down sources an exercise in futility; like a Hydra, when one pirate site is killed others take its place.

One avenue companies have explored is digital rights management, which puts restrictions on content for legitimate customers as a safeguard against potential piracy. However, new research from Rice and Duke universities suggests that removing DRM may actually be more beneficial for curtailing copyright infringement than including it.

Study: cut DRM and people may pirate less

The joint study found that DRM has the potential to actually nudge people toward piracy. Turns out, paying customers don’t like being limited by invisible boundaries included in a product they bought.

“In many cases, DRM restrictions prevent legal users from doing something as normal as making backup copies of their music,” said Dinah Vernik, assistant professor of marketing at Rice’s Jones Graduate School of Business. “Because of these inconveniences, some consumers choose to pirate.”

Far from condoning or downplaying piracy, the researchers actually believe that ditching digital DRM so it resembles physical media will serve both companies and consumers in the long run.

“Removal of these restrictions makes the product more convenient to use and intensifies competition with the traditional format (CDs), which has no DRM restrictions,” said Vernik. “This increased competition results in decreased prices for both downloadable and CD music and makes it more likely that consumers will move from stealing music to buying legal downloads.”

Though the natural assumption might be that shrinking piracy paves the way for higher legitimate profits, the group was loathe to make that connection.

“Decreased piracy doesn’t guarantee increased profits,” said Devavrat Purohit, Duke marketing professor and fellow researcher. “In fact, our analysis demonstrates that under some conditions, one can observe lower levels of piracy and lower profits.”

The researchers’ full paper, “Music Downloads and the Flip Side of Digital Rights Management Protection,” is due for inclusion in the upcoming November-December issue of the Marketing Science journal. (via Home Media Magazine)