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Apple stuff

Does anyone else see the inherent link between this and this?

The new iPods need to authenticate their dock before they can output video... ...and iTunes seems to have "RentalMovie" as a keycode for some of its problem reports.

This is one of those things that DRM lets them do. One of the use cases that opens the door for DRM in reasonable people's minds. 'cause you really really can't do rentals without it, unless you go by the honor system.

It's one of those moral conundrums associated with being a geek today. Yay or boo?

Comments

( 7 comments — Leave a comment )
the_gadgetman
Sep. 10th, 2007 04:55 pm (UTC)
I think the real question here is does rental of bits make any sense. The cost of making bits available for rent is actually higher than making them available for sale, becasue as you note you need a DRM infrastructure in place for rentals which you don't need for sales. The costs for providing the actual product are otherwise the same, as in both cases you need to make a copy of the bits and delilver them.

I think the cost of a rental would have to also be pretty low to be attractive. DVDs rent for a buck a day around here from vending machines, so a digital rental would have to beat that to be attractive.
yandros
Sep. 10th, 2007 09:01 pm (UTC)
I don't understand; speculating on bit-rentals
Under what market situation would you need a DRM infrastructure for bit-rentals but not for bit-sales? (physical-item rentals and sales being obviously different)

I'm guessing that you mean some sort of active, continuing over time system when you say `infrastructure', but you kind of need those for bit-sales, too (but, thankfully, you can optimize away much of the actual conversation).

Speculating as to markets, I myself would be more likely to `rent' a TV series from the iTMS than to `buy' it, assuming a significant price difference. IMHO, if I'm going to buy a TV show, I prefer buying a physical package (less DRM restrictions, and at least the potential for higher-rez viewing). I don't think I'm a mainstream customer in this market, though.
crs
Sep. 10th, 2007 09:12 pm (UTC)
Re: I don't understand; speculating on bit-rentals
Oh.

Um... yeah, those are all good points.

All righty then. The remaining question becomes, then, have they protected the iPod clock from getting reset without a sync? 'cause yeah, that's about the only way it matters.
the_gadgetman
Sep. 10th, 2007 09:16 pm (UTC)
Re: I don't understand; speculating on bit-rentals
Renting something implies that eventually that something will stop being usable (due to a time deadline, no longer paying rent, or some other criteria). The only way to enforce that with a data file is some DRM scheme. That's not necessarily needed for a sale, as currently shown by the growing number of vendors of non-DRMed music.

Infrastructure-wise, you need systems in place to manage those DRM terms, in addition to the distrubution and financial infrastructure (the latter 2 of which you do need for sales as well). Again, that DRM infrastructure isn't needed for non-DRMed sales.
danj17
Sep. 11th, 2007 01:30 am (UTC)
Re: I don't understand; speculating on bit-rentals
designing a system from scratch, this is of course all true. however, itunes is not a system designed from scratch; it's a system that is already doing DRM'd sales.

the world is full of examples of things that cost more to make, and sell for less. the work is done on the expensive item, then a small amount of marginal work is done to turn it into the cheaper, less functional item. the price point of the cheaper item is more than enough to make up for the *marginal* work. (remember the 486SX? and here's a completely ludicrous extreme: bombardier sells a 40-seat regional jet. it is exactly the same as the 50-seat jet, with a bunch of bulk where rows 1, 2, and 13 would be. the airline is contractually forbidden from removing the bulk.)

for DRM sales shops, the marginal work to do modify the DRM infrastructure for rental sales should be small enough that even the rental pricepoints can make it up.

for the non-DRM shops, the rental price point may not be enough to bother developing a new DRM system at all. (tho netflix may be onto something with its streaming option..)
the_gadgetman
Sep. 11th, 2007 02:19 am (UTC)
Re: I don't understand; speculating on bit-rentals
Quite true, although I think the point that sales are cheaper than rentals is still valid.

Going back to my original comment, though, I still wonder what the point of renting bits is. In renting physical objects like a DVD, which the user may only want to view once, it makes sense, because with a rental the owner gets the item back to rent to another user. In the purely data world though, the owner has no need to get the "original" back, they already have it for the next n users as well. So what's the point of a rental? Customer perceptions?
danj17
Sep. 11th, 2007 12:51 pm (UTC)
Re: I don't understand; speculating on bit-rentals
the point? to extract more money from the viewing public. nothing more.

if movies are only available for sale, sellers have to pick one price. and the movie studios will be sure that price isn't $3.

enough people are willing to pay $10-25 to "own" a movie that it makes sense to price unlimited viewing there. people who just want to see the movie once aren't going to pay more for home viewing than for a movie ticket -- that's where the $2-3 rental price comes in. i don't have numbers here, but i'm quite sure that offering sale at $15 and rental at $3 will produce more revenue for the same content than sale alone at either $15 or $3.

more cost? yes. more profit? oh yes.
( 7 comments — Leave a comment )

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