DRM @ PTC

Digital Rights Management (DRM) has been quoted as the answer for dealing with piracy whether it be software or music or any other other form of intellectual property such as text, images, movies and games. But DRM is not the only defence that industries use to protect their interests. In this post, I would like to talk about a few different options that industries have referred to in the past to combat piracy.

Perhaps it is the music industry that has attracted the most attention for its efforts to stem online piracy. The Recording Industry Association of America (RIAA) claims piracy as a prime culprit in a $2.7 billion decline in revenues between 1999 and 2003; the Motion Picture Association of America (MPAA) cites worldwide losses due to piracy at $3.5 billion, though the organization declines to calculate losses due to the Internet. Specific DRM solutions aside, DRM is considered the answer to the media industry’s preoccupation with piracy.
For the major media companies that have reacted to piracy with some form of rights enforcement, results have varied in effectiveness. By far, the most common form of enforcement, and the least effective, is the cease-and-desist order. The New York Times, for example, took issue with Amazon.com and Borders.com for publishing its Bestsellers List on their sites without permission from the newspaper. In May 1999, The Times sent both companies cease-and-desist orders.
Some companies have actually filed lawsuits against infringers. In cases where ownership of the pirated material is verifiable, through the use of DRM or otherwise, this can be effective. Playboy magazine was awarded nearly $4 million in damages plus legal fees last year in a suit against a site called Five Senses. The site was offering over 7,000 scanned Playboy images as part of a subscription service. On rare occasion, rights holders have succeeded in shutting down pirate sites.
 

Figure : Industry Responses to Piracy

Source: Jupiter Research
© 1999 Jupiter Research

In the field of software, it is estimated that Central Europe and Latin American countries hold as much as 60-70% pirated software, with Asia-pacific following with about 55%. With such high estimates for the pirated software, software vendors are, no doubt, have a right to be concerned about the loss in revenue as well as the dilution of their brand equity. Perhaps no company has had so much trouble with piracy as Microsoft. Over the last couple of years, Microsoft has launched several initiatives to combat piracy. These measures, dubbed “The Genuine Advantage” set an example of how piracy can be combated not by means of monopoly but by the way of offering goodies to genuine customers.

The Microsoft program “The Genuine Advantage” is a small piece of software that can correlate the software certificate number with the machine. Once the correlation is established, only after getting the consent of the user, the software does not need to send any further information to Microsoft, thus alleviating any constant concerns of privacy associated with this system. Once Microsoft deems the software as genuine, it offers all the updates, security patches and even some free softwares, templates and goodies as a reward to genuine customers. In fact, it is a great example of how Microsoft has used to its own advantage the existence of security loop-holes and malicious viruses and worms to scare users away from pirated software and conveying the impression that Microsoft protects its genuine customers.

http://download.microsoft.com/download/3/6/3/363e4976-3abd-4eab-b2e2-a643342bc869/Yankee_Group_Piracy_Research_Whitepaper.pdf