Macworld Highlight: iTunes DRM Free by Q2

This week it's MacWorld, which is the place to be for Apple fans. For the first time after Steve Jobs' return to Mac, the MacWorld had to do without its charismatic inspirator. Instead, the Macadelic fans had to work their way through the keynotes by Phil Schiller.

Image: iJustine @ Tasty Blog Snack

Steve's Health

Image: iJustine @ Macworld Flickrstream

With Jobs not on the spot, and only a cardboard representation present to adore, the absense of Steve Jobs led to speculations about his health, some of which included the return of cancer, untill finally Apple released a statement.

By finally deciding to talk about Steve Jobs' health, Apple may have opened a Pandora's Box.

After insisting for months that Jobs' health was a private matter, Apple changed its tack in the face of widespread speculation regarding its CEO's weight loss. On Monday, the company issued a statement that Jobs was suffering from a hormone imbalance that was "robbing" proteins from his body. That news cheered Apple investors, who dreaded far worse news regarding Jobs' health after a report last week that his health was "declining rapidly."

The disclosure was clearly painful for Jobs, who wrote in an open letter, "So now I've said more than I wanted to say, and all that I am going to say, about this." That might not be so simple.

[CNET Steve Jobs' health now a public matter ]

Taking Jobs out of the Apple Equasion would be a sure thing to upset investors and stock market as he brought Apple back to life upon his return to the company in 1997 after an absense of 12 years. Smash hits over the past years have been the iPod and iPhone which has put Apple back in business.

Apple's DRM Policy

With the iPod Apple launched the iTunes store where users can buy music. The catch has been that Apple included a DRM feature so the songs could only be played with Apple software. Although Apple itself has called its DRM policy 'Fair Play', it met strong opposition. Following actions in France and Germany the Norwegian Ombudsman ruled the Apple DRM to be illegal, according to the Register.

Apple's digital rights management lock on its iPod device and iTunes software is illegal, the Consumer Ombudsman in Norway has ruled. The blow follows the news that Germany and France are joining Norway's action against Apple.

The Norwegian Consumer Council, Forbrukerradet, lodged a complaint with the Ombudsman on behalf of Norwegian consumers claiming that the Fairplay DRM system acted against the interests of consumers. It said the fact the technology stopped songs bought from iTunes being played on any player other than an iPod broke the law in Norway.

The Ombudsman has now agreed, according to Torgeir Waterhouse, senior advisor at the Consumer Council.

In Februari 2007, Steve Jobs himself posted a lengthy article with his thoughts on the DRM which might be good to read to get some background info, but too lengthy to quote here. There's one paragraph thought which I'd like to quote:

The third alternative is to abolish DRMs entirely. Imagine a world where every online store sells DRM-free music encoded in open licensable formats. In such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players. This is clearly the best alternative for consumers, and Apple would embrace it in a heartbeat. If the big four music companies would license Apple their music without the requirement that it be protected with a DRM, we would switch to selling only DRM-free music on our iTunes store. Every iPod ever made will play this DRM-free music.

We're two years on and Apple finally has made a deal with the record companies and announced the iTune products will be distributed free of DRM.

DRM Background

This act by Apple is a step forward, but it's a long way off in solving the DRM issue, because Apple isn't the problem here, it's the Music Industry itself. A good guide to catching up with the situation would be to read "The Starfish and the Spider" by Ori Brafman and Rod Beckstrom.

Digital rights management (DRM) is a term that refers to access control technologies used by hardware manufacturers, publishers and copyright holders to limit usage of digital media or devices. Whereas copy protection only attempts to prohibit unauthorized copies of media or files, digital rights management allows the issuer of the media or file to control in detail what can and cannot be done with a single instance. For example, an issuer can limit the number of viewings, number of copies, which devices the media can be transferred to etc. Digital rights management often depends on cryptography and on-line activation. Blu-Ray and some recent game titles by Electronic Arts are an example of each. Digital rights management is used by content providers such as Sony, Microsoft and the BBC. [Wikipedia]

Back in the early 20th century we did not have recordings of music and when we would like to hear a piece we would go to the theatres and opera halls, or the streetcorners to hear the music being performed. If we paid to listen, we paid directly to the musicians.

When recording devices and carriers such as vynil records arrived it opened up a whole new world. You could bring the music home. Record companies arose liked webdevelopment shops in the late 90's. A few years later it boiled down to the big 5. Five major companies gained control over 80% of the entire music industry.

Suddenly there was Napster, a rogue internet company offering music for free. The big 5 were terrified and sued Napster and broke it down. Pandora's box had been opened though and peer to peer (p2P) networks like Kazaa and eDonkey took over. Stealing music had become common practise.

The question is, is downloading music and films for free actually stealing? Yes in my opinion it is. But then again, it is no different than selling music at the current prices. It is the record companies themselves which are the biggest thieves here. They steal from both the Musicians and the consumer. As consumers we have to pay massive amounts to acquire a legal copy of an Album, whereas the performer gets just a fraction of what the Record Companies receive.

As long as this practise continues, there will be p2p distribution of music. The sole reason I think p2p has made such a big bang is because of the absurd amounts of money the big five made off the backs of the consumers and the artists. In this way, whatever DRM measure you implement, it will be prime target to hack. If we further decentralise and more and more artists start to distribute their own music through social networks at a fair price (in the Netherlands a CD is now about 24 Euro), let's say they'd sell them directly for 5 Euro, with DRM. This means a significant pricedrop, yet a substaintial gain in income for the artists. Would the download community accept that?

Power to the Community

"Power to the Community" was the title of one of the main sessions prior to Rod Beckstrom's presentation on the Starfish and the Spider at the "From Web 2.0 to Enterprise 2.0" conference in Utrecht last wednesday.

I liked this presentation, not because Patrick Savalle is a Sogeti colleague, but I like his way of thinking. It was what you could call a boardroom wakeup call. The essence of the presentation was moving the crowd from version 1.0 to 2.0.

One of the things to churn on was explaining the Peter Principle which often occurs in centralized organisations (the spiders) which pionts out that a hierarchy every employee tends to rise to his level of incompetence.

His second thought focussed on emergent behaviour; In a crowd we all do things we wouldn't do as individuals. We've all been suckered into buying things we don't need by early marketing guru's like Edward Bernays who laid the foundations of mass manipulation and crowd control.

His final thought was called Social (web-) Design. When looking at social networking sites you have to find what makes these things attractive. How do you build communities? It's in little things, it's in poking, it's in listing events, in smilies, profile pictures or tweets: all these little things are a frameset in which the crowd interacts and grows into a collective community. This collective community will eventually return to emergent behaviour so we have to be carefull. Edward Bernays, much like his uncle Sigmund Freud, wasn't all that happy with what he did to humanity. Maybe in 20 years we'll have a generation of social webdesigners looking back at how they manipulated the masses.

In my opinion that's a pretty spooky thought. Walk along that path and we might even end up with Asimov's famous Psychohistory;

The basis of psychohistory is the idea that, while the actions of a particular individual could not be foreseen, the laws of statistics could be applied to large groups of people and used to predict the general flow of future events. Asimov used the analogy of a gas: in a gas, the motion of a single molecule is very difficult to predict, but the mass action of the gas can be predicted to a high level of accuracy - known in physics as the Kinetic Theory. Asimov applied this concept to the population of the fictional Galactic Empire, which numbered in a quintillion. The character responsible for the science's creation, Hari Seldon, established two postulates:

• That the population whose behaviour was modeled should be sufficiently large
• They should remain in ignorance of the results of the application of psychohistorical analyses.

So my question to Patrick would be: Shouldn't the title be "Take power from the community" instead of "give power to"?

Why Starfish can’t jump

Ogogolio’s Trevor Smith posted a nice comment on the Starfish presentation:

Thanks for posting the videos. I'm a bit surprised that you can grok his message but choose to work in the spider verse of SL instead of contributing to one of the starfish.

Second Life is controlled by a single corporate entity, hosted on centralized hardware, governed by a single legal structure, and is fundamentally structured around the centralized idea of One Big World.

In this analogy, Linden Lab is the spider head and if you chop it off then Second Life is dead.

I think I have to disagree with Beckstrom then, I guess ;). And I really do.

The thing Rod says about Starfisch companies is that they are decentralized but in order for this to function, there needs to be a very very clear set of operational protocols.

In this, each organisational cell has to have the maturity to operate autonomously within the main ideology. But what happens in unforseen circumstances? Who makes the decisions when a company comes into a crises? It is impossible to have a full starfish company. What happens if we’re in a hostile take-over situation or a scandal? Who will have to pick up responsibility in the end? What if two decentralized cells or organisational units have different interests, or even conflicting interests, who mediates or puts out strategy in the end?

An example of this would be typically Dutch churchlife. In the Middle Ages we had the Catholic Empire. Super centralized and only the clergy had Bibles, their handbook, protocol set. That didn’t really work and Calvinism rose and in the ages past dozens of religious factions appeared. Each having their particular organisational model. Some with centralised governing bodies, others decentralised. The particular set I go to is kind of decentralised. Locally governed churches. Each member of the church has his/her own handbook nowadays and we’re all considered to be really smart intelligent people. There are occasions though that Elders put out a different gospel, to keep with the handbook, a cell leader that thinks the set of protocols needs to be altered a little, or other issues that can’t be solved at a local level. For this occasion there’s a national assembly every four years to judge these things. Consider changes or addenda to the protocols and make a ruling in cases where protocols have been violated, or challenged.

Optimal performance is a cross between Starfish and Spiders I guess, or every rule has its mandatory exceptions.

Now when it comes to Second Life, is it really a Spider company? In part it is, it’s true Linden Lab brings us Second Life. It’s true they’re responsible for many things. But in part it isn’t.

Linden Lab itself isn’t a spider corporation. There’s the tao of Linden which allows each unit or individual employee incredible freedom in picking his / her own priorities (LL should be more Spider in this regard). De grid is spread over several hosting locations, yes true, all LL owned. Take out part of the grid, the other part lives on.

Ogoglio of course is different. It’s open source and if we chopped off Trevor’s head (that’s a no-no) Ogoglio would live on. You can run it at home. Great stuff, and very very Starfishish.

There’s a wide range of variety though. Second Life is open, decentralized sometimes even anarchistic when it comes to user generated content. If we’d cut off Philip’s spikey head (also a no-no) would content creation stop? We’ve got tens of content development companies and we’ve got an active, contributing community. This can’t be said for a range of other platforms, even when the are enterprise platforms and you can run your own version of it, you’re still by far and large dependable on the platform owners for content creation.

The Starfish and the Spider

Heliview organised a web 2.0 seminar today at the Jaarbeurs in Utrecht, titled "From Web 2.0 to Enterprise 2.0" It's keynote speaker was Rod Beckstrom, author of the Starfish and the Spider.

Below is the presentation he did at the Next Web Conference, which is pretty much the same story and same slideshow. Sit down and enjoy. It's good stuff.

Part 1: The Starfish and the Spider

Part 2: Geronimoooooooo!

Part 3: From centralized to decentralized business