Love DRM or my family starves: why Steve Ballmer doesn't Get It

Ballmer digs pit, inserts whole MS strategy, keeps digging

As regards the food on the table, what Steve anticipates as providing this in the future is the success of Digital Rights Management, with Microsoft as gatekeeper. As he told the FT in yesterday's interview: "There are enough people watching television [to create] a big opportunity. We just charge [cable and phone operators] a tiny little bit of money, not even 'annoy them' money." Success of DRM on cable TV systems is inherently more plausible than on the internet, because of the level of control already exerted by the providers, but there is no obvious reason why cable operators should elect to use Microsoft DRM, unless it is propelled by momentum gained elsewhere. It would therefore seem likely/obvious that the overall success of Microsoft DRM will be related to its success in the nascent online music sales business.

Which is where Apple comes in, and where iPod users might be thieves, and where the nature of the DRM becomes relevant. One of The Register's wiser acquaintances in the handset business told us the other day he'd been lobbying not for 'foolproof' DRM as being pushed by the techies, but 'good enough' DRM, i.e. 'good enough for us not to get sued'. This is very wise and sensible, because handset companies want to sell handsets, want to help their networks to sell handsets, and aren't in the business of helping the entertainment business tithe digital sales. It's naturally not good business for them to get sued by the music industry for aiding and abetting crimes, but it's very bad business for them to try to sell handsets that interfere with consumers playing their own stuff. So they need good enough DRM, good enough to cover their arses, but DRM beyond that level is counter-productive.

Apple's iPods have DRM, but you don't really have to notice it, because it's 'good enough DRM', enough to keep the music business in check (Apple now being a major force in online sales helps here as well) but not unspeakable enough to conform to that industry's crazed desires, and not strong enough to be a significant negative for iPod and Apple Music Store purchasers. It's like handsets, except with Apple it's headsets - the company's objective is to sell its own stuff, not to police the music industry's stuff, and it keeps that objective in mind.

Microsoft, on the other hand, publicly and privately shares the music industry's views, and markets its DRM to digital content owners on the basis that it is strong protection. We anticipate that quite a bit more blood will be spilled before the music business is finally convinced that its current course is futile (but check here for an attempt to get them to see sense early), and Microsoft is going to be along for that ride.

Talk to practically any Microsoft executive and you'll find that they really do believe that all content that doesn't go onto a player or a computer via an 'approved' sales channel with 'real' DRM is stolen. It's a totem, a religion that permeates the company, and it really, really does run to the extent that most of them (the marketing ones, anyway) profess never to have dipped their toes into the waters of file sharing, 'because that would be stealing'. And indeed we know, from Steve down, what puts the food on the table. Presumably the techies know better, but are smart enough to keep their mouths shut.

It's kind of difficult for a company to combat something if it don't have some understanding of it, but that's pretty much what Microsoft is trying to do. Microsoft execs and music industry execs will probably be the last people in the world to Get It as far as digital content is concerned, and they are going to be singularly ill-equipped to even notice as everybody else proceeds on the basis of a more rational and workable belief system. They will still be trying to explain why DRM is yummy and good for us, we will be rolling our eyes and carrying on pretty much as before, revolting every now and again by boycotting selected devices that are factory-fitted with Denver Boots. They will look at their sad sales figures then redouble their efforts to get across the message that DRM is good for us.

The point about Apple's DRM strategy, on the other hand, is that it's a tactic, not a strategy at all. Apple knows damn well that attempting to deliver the music industry's desires is an exercise is suicidal futility, but recognises that it can gain an advantageous position and put food on its own table by taking the good enough DRM route. That way it gains strength in the run-up to the music business seeing sense, and it's even helped by potential competition eliminating itself when that competition is perceived to be agreeing with the music industry too hard. Ballmer's thieves jibe no doubt played well to Microsoft's friends in the music business, but it possibly plays even better as far as Apple's image with consumers is concerned. 'Apple, the company that doesn't stop you playing what you want, where you want?' Not entirely true, but if we were running iPod marketing we'd be pretty pleased with Steve for suggesting that.

Microsoft's belief that the PC is and must remain the centre of all things, everywhere, predates DRM as a corporate religion, but for consumer digital services it relates for reasons additional to food and tables. All of the entertainment gear you have littering your home can now come as part of a PC box, and therefore from Microsoft's perspective there is a compelling logic to you eventually throwing all of that stuff away and putting the PC box in the living room instead. The inherent faultiness of this reasoning is however apparent even to Microsoft, and results in the invention of more plausible alternatives, but these are maimed by the need to retain the primacy of the PC, and indeed to convince the world that strong DRM is good for you. Microsoft's connected appliance strategy does sound potentially viable of itself, but the company's need to insert a PC into the equation is likely to cripple the plan, and quite possibly to tar the PC as the box you buy in order to stop yourself using all your connected appliances to steal stuff. Which does not sound like a winning sales pitch.

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