Rights Management

Lessons Learned Digital technology poses two challenges for rights management. First it reduces the cost of making copies. Second, it allows the copies to be distributed quickly, easily, and cheaply. These challenges also offer opportunities. Reduced distribution costs help to advertise your product by making it cheaper to give away samples. This is useful when there is significant demand for repeated views for for closely related content. Giving away samples helps to sell more content. Reduced distribution costs are beneficial to those who sell illicit copies as well, but their need to advertise helps keep "bitlegging" under control. A bitlegger that gets too big and attracts too much attention will soon be caught. Copy protection schemes impose costs on users and are highly vulnerable to competitive forces. Trusted systems, cryptographic envelopes, and other copy protection schemes have their place but are unlikely to play a significant role in mass market information goods because of the standardization problems and competitive pressures. When choosing terms and conditions, recognize the basic trade-off: more liberal terms and conditions will tend to raise the value of your product to consumers but may reduce the number of units sold. The trick is to pick the terms and conditions to maximize the value of your intellectual property, NOT to maximize the protection. Site licenses and other group-pricing schemes are a valuable tool for managing terms and conditions. They economize on transaction costs for both the buyer and seller.