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On the Zune’s 3×3 limit and device specific limitations

Recently, there has been a lot of talk about the Zune and its wireless sharing functionality, which is — surprise, surprise — defective by design. If you share a song with another Zune owner, the recipient can only listen to the song in question for three times, and he/she has to do this within three days — after that, the file is rendered unusable. A couple of days ago, it was widely reported this was done by wrapping the file in DRM, which made many raise the question whether this would “violate Creative Commons licenses” or not. Go to James Grimmelmann’s Laboratorium for a great analysis of the issue:

It’s not clear to me that this design decision actually causes legal trouble for anyone. First, Microsoft is not, presumably, loading up these devices with CC-licensed media and streaming the files around. Thus, Microsoft hasn’t even passed the basic threshold for violating a license: having been a licensee in the first place. If anyone is violating the licenses here, it’s the users loading up CC files on Zunes and them sending them to friends along with some tasty DRM.

Trouble is, I’m not sure that a CC licensor has a case against users who do just that. The process of placing a file on a Zune is not “ditribut[ing], publicly display[ing], publicly perform[ing], or publicly digitally distribut[ing] the Work,” so it is explicitly allowed by the license. (It’s also a fair use.) That leaves the act of sending it to a Zune-playing friend. In almost all cases, that’s a private, non-commercial copy that cannot substitute for any market for the original. In other words, we are in one of the heartlands of traditional fair use. […]

A couple of days later a Zune developer gave some further clarifications:

We don’t actually “wrap all songs up in DRM:” Zune to Zune Sharing doesn’t change the DRM on a song, and it doesn’t impose DRM restrictions on any files that are unprotected. If you have a song – say that you got “free and clear” – Zune to Zune Sharing won’t apply any DRM to that song. The 3-day/3-play limitation is built into the device, and it only applies on the Zune device […]

So, instead of a DRM system, we have to do with a device specific limitation here. That doesn’t take away the fact that this measure makes the Zune defective by design though. Cory Doctorow comments as follows:

Rightsholders’ wishes are important to MSFT as an excuse for monotonically ratcheting up the restrictions, but are irrelevant when they enable restrictions to be relaxed.

This case is a good illustration of the thin line between DRM and non-encryption based restrictions inside devices. It’s worth noting that there is a legal difference between both techniques: in case somebody writes software to get around the 3×3 limit, the anti-circumvention provision won’t come into play (as there is no DRM being circumvented). Instead, MS will probably release a firmware upgrade for the Zune, thereby triggering subsequent rounds of patches and firmware upgrades for the months and years to come.

To conclude, I’d like to point out that both DRM “wraps” and device specific limitations à la Zune’s 3×3 limit are a fact of life on the Japanese market — especially the mobile market. Two examples:

  • On some Japanese mobile phones, only SD-audio is supported. This means you can only transfer MP3 files to your mobile phone through the SD-Jukebox software, which wraps the files in DRM before copying them to your mobile. Copying them back from your mobile to a computer is only possible if it is the computer they originated from. Needless to say, DRM is wrapped around music files regardless of their license. But as Grimmelmann has pointed out (see above), this isn’t necessarily a problem (although it’s definitely annoying).
  • Another example: if I mail a bitmap or Flash file to my Toshiba mobile phone, the device automatically marks the file as copy-protected. No DRM involved here, just a device specific flagging system (crippling the device for no good reason).

David Robinson and others on Zune

A quick pointer to a recent Freedom to Tinker post by David Robinson: Rethinking DRM Dystopia.

I was surprised to read recently that Zune, Microsoft’s new music service, will probably scan users’ iTunes libraries and automatically buy for them (at Microsoft’s expense) copies of any protected music they own on the iTunes service.

If true, this news might have an enormous impact on the digital music market — think about:

  1. how a strong Microsoft music player would give the labels more leverage in their negotiations with current price-setter Apple
  2. how this gives the content industry even stronger veto power over which media devices can enter the market
  3. how companies that only develop a portable music player without also building an online music store and negotiating with the labels are out of luck (*)

Zune logo

I still need to chew a bit on this, but I think David Robinson draws the right conclusion (sorry for all the quoting) — from his post:

What are the lessons here? Personally, I feel like I underestimated the power of the market to solve the possible problems raised by DRM. It appears that the “lock in” phenomenon creates a powerful incentive for competitors to invest heavily in acquiring new users, even to the point of buying them out.

What a very interesting thinking experiment this is…

Update 2006-09-19: there’s a lot of coverage about the Zune, but, as Tim Lee points out, nobody seems to talk anymore about the earlier mentioned buy-out scenario… Vaporware?

(*) For now, it is unclear if third parties will be able to develop Zune-like music devices. Tim Lee points out that the Zune won’t be PlaysForSure compatible, giving Microsoft a lot of market power in picking the players (if any) that are allowed to ride the Zune wave.

FFWD 2007

A quick look at the copyright related developments I see (or don’t see) happening in 2007. My predictions, in no particular order:

  • We’ll see more experiments with DRM-free major label music in the line of Yahoo Music’s efforts, but a full switch to DRM-free music distribution will not happen in 2007. And no, I don’t see Amazon’s rumored music store project turning the tide.
  • The Zune’s sharing feature will be incorporated in other music players, but in a much more interesting fashion. That means we’ll see devices with uncrippled wifi-support, allowing for unlimited (and possibly even cross-device) sharing.
  • The content industry (esp. in Japan) will continue pushing HD broadcasting and formats, while ignoring what most people actually want: instant, lightweight, malleable, shareable and mashable media à la YouTube and its more open variants.
  • The chaku-uta business won’t go away, but sales will slow down as more and more customers find out they’ll have to purchase all their media again when they switch to their second or third 3G handset.
  • One Japanese mobile carrier (SoftBank?) will start offering a cellphone with real MP3 support. AU and DoCoMo will try to ignore this development and stick to their DRM-encumbered, if-you’re-lucky-MP4-enabled handsets instead.
  • Japan will extend the term of protection for music and literary works from 50 to 70 years. Alas.
  • Once the time is there to start purchasing Vista licenses, the Japanese government will announce it is thinking about switching to Linux, which, as I’ve argued before, is just a negotiation tactic.

And what do you think?

How (not) to invest in music

Back in January 2004, Robert Scoble wrote about the problem of DRM lock-in, and more specific about Apple’s FairPlay. Scoble:

Let’s say it’s 2006. You have 500 songs you’ve bought on iTunes for your iPod. But, you are about to buy a car with a digital music player built into it. Oh, but wait, Apple doesn’t make a system that plays its AAC format in a car stereo. So, now you can’t buy a real digital music player in your car. Why’s that? Because if you buy songs off of Apple’s iTunes system, they are protected by the AAC/Fairtunes DRM system [sic], and can’t be moved to other devices that don’t recognize AAC/Fairtunes [sic]. Apple has you locked into their system and their devices.

Scoble then went on explaining why Microsoft’s Windows Media DRM is a safer bet than FairPlay, mentioning the possibility for third-party licensing and the PlaysForSure initiative, resulting in a wide ecosystem of compatible devices. Sounds reasonable? Imagine you followed Scoble’s advice — it’s 2006 now, and you’re drooling over Microsoft’s latest, the Zune… A rewrite of the quote above illustrates why you’re 0wned:

Let’s say it’s 2006. You have 500 songs you’ve bought on MSN Music/Urge/Napster/… for your PlaysForSure labeled music player. But, you are about to buy a Zune. Oh, but wait, Microsoft made the Zune so that it is not compatible with Microsoft’s own Windows Media DRM format. So, now you can’t buy a Zune. Why’s that? Because if you buy songs off of MSN Music/Urge/Napster/…, they are protected by the Windows Media DRM system, and can’t be moved to other devices that don’t recognize Windows Media DRM. Microsoft has you locked into the (who knows, maybe soon defunct?) DRM system they developed and the devices they approved as part of their PlaysForSure program.

The one and only solution? Do what Cory Doctorow says: “Protect your investment. Vote with your wallet. Buy open.”

About Napster.jp and audio DRM

The nice thing about living in Tokyo is that, in order to be updated about all things tech, you just have to take the train. Napster Yesterday for instance, the Yamanote line train cars taught me that Napster (this one, not the legacy one) has opened a Japanese version of its online store in the beginning of October (totally missed that as I was in Belgium then). This is a noteworthy development, because of a number of reasons:

First of all, Napster.jp is the first flat rate all-you-can-download music service in Japan. And to be honest, the rate isn’t that bad: 1280¥/month is quite affordable. Of course, if you can live with the fact that, after a year and 15360¥ spent, you own exactly 0 songs…

Also important: Tower Records might be dead in the US, but as you see on the picture I took, it’s alive and well in Japan: “Napster x Tower Records,” reads the poster.

And of course, DRM ahoy! Needless to say, Napster files will not work on your iPod, Mac or the upcoming Zune. They will work on some (only some) mobile phones though. For instance, have a look at the Docomo x Music page and go to the “products” tab. If you hover over the phone images, you can see the supported “storage format” in the left sidebar — messy, to say the least. My favorite is the blue SH903i in the middle: Napster/WMA (Windows Media DRM), SD-Audio (SD-Audio DRM) and AAC (Chaku Uta Full DRM). That’s three completely different DRM formats for playing music on a small portable device — not to speak about the several interfaces for purchasing and managing music. Seems like the people preparing the SH903i manual also had a hard time explaining the differences, incompatibilities and restrictions — such a hard time, that they released three audio manuals: one explaining Napster To Go, one SD-Audio and another one WMA. Ouch.

Update 2006-10-27: I’m currently trying out the one week Napster trial and must say that I’m not very impressed. Choice is limited, and most Japanese songs are not a part of the all-you-can-download program, so you have to purchase them separately. I also have my doubts about the crappy Japanese interface, which seems to be rushed out in order to launch Napster.jp before the release of the (incompatible) Zune in the end of 2006.