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It seems everyone is raving about the creature creator in Spore. As J says, expect to see a lot more of these. The idea behind Spore is truly brilliant, to let everything in the game evolve, the ultimate simulation of life. And yet, the game is already tainted by the promise of the same DRM that Shamus has been warning about for months - the game requires an online security check every ten days or it stops working. This is outrageous, well beyond the reasonable need of copy protection.

In fact, the recent coverage of these issues at Shamus’ site has led me to reconsider my own position on PC gaming entirely. I haven’t actually played a PC game since Tie Fighter and Myst: Exile. However, I have entertained thoughts of building a new rig for gaming (and scientific calculation, mostly MATLAB). Increasingly, though, the trend in PC gaming is towards more DRM, not less, and I don’t see any compelling argument to subject myself to the suspicion of being a criminal. Aside from Spore, that is - but Spore will also be released on the Wii.

In addition, at some point in the near future we will be biying an HDTV, and then will need a Blu-Ray player. The single best Blu-Ray player on the market, also the cheapest, is the Playstation 3. Between the Wii and the PS3, is there any genre of game that I might even theoretically want to play which isn’t available on the console side? Even Portal, the other game that has my attention, has a PS3 version.

I think it’s safe to simply declare that console gaming is the sole route I will follow from here on out. Rather than invest even a minimal $500 in building a gaming rig, I can buy ten games on the Wii. The value proposition of console gaming blows PC gaming out of the water since you aren’t stuck in the perpetual upgrade cycle - and consoles have astounding longevity, just look at the PS2 (another system I might pick up someday for kicks). And actually owning my games, and being able to play them without jumping through hoops, is just icing on the cake.

Shamus has long been a gamers’ advocate with regards to prohibitive DRM on computer games, and even has a common-sense 5 point solution to the problem. Unfortunately, since his plan (which treats customers as customers instead of potential pirates) does nothing to actually prevent pirates from pirating games, his solution is likely to be ignored. It seems to me that any solution to ease the DRM load on the end user will need to at least make a token effort to reduce or otherwise inhibit piracy, for it to be taken seriously. Obviously, the common-sense argument that Shamus makes, namely that good business practices which treat customers like a scarce resource instead of a bitter enemy will result in higher revenue despite piracy, is simply not going to penetrate. Even Penny Arcade, a longtime gaming fansite, fell prey to DRM’s allure in their own game, after all.

Somewhat related to all of this is the lesser issue of CD keys, about which Shamus draws a distinction to DRM with. If all DRM was just CD keys, then DRM wouldn’t be that much of a pain, but the problem with CD keys from the manufacturer perspective is that they can be written down, cut and pasted, emailed, etc. I’ll readily admit that I’ve used CD keys for various software in the past that were “borrowed” - its no different (apart from being less annoying) than the old “whats the 10th word on page 4 of the game manual” routine. So, again, as far as preventing piracy, or even mitigating it, CD keys just can’t solve the problem.

However, in considering CD keys, a possible solution to piracy does present itself. What is needed is something that is both dynamic and tied to the specific user. For example, imagine a software download service wherein:

1. game can be downloaded if user sets up an account and registers a credit card for payment. game can also be mailed out on physical media for nominal extra charge.

2. user is asked to set a password to their account. This account is treated like a bank acct password, ie you have the little picture for verification, you have security questions about your mom’s maiden name etc, the whole bit.

3. upon download, game can be activated for installation (not play!) by entering a key that is generated via a standard one-way function in real-time by several inputs:
a. the license number emailed to the user (or printed on the back of the physical disk).
b. the user’s username and password to their online account
c. the current date and time (automatically slurped from public date/time servers).

4. the game itself can be played anytime, but still requires username and password (not CD key).

the advantage of the scheme is that the activation code for installation is not a static string but something that changes in a consistent way. The one-way function should be something very well-known (like MD5). The only way that the game can then be shared would be for the user to share his account password and login, which presumably they’d be incentivized NOT to do, because their account represents private data including payment information for future game purchases.

The user would be happy because the code is easy and really just requires a simple login, and then the game is fully unencumbered for play. The game company would be happy because they are tying each copy of the game to a specific consumer, and they can leverage that for marketing purposes as well (for example, offering good customers a buy 10 get one free deal, or a points system to redeem games, or the option to download exclusive minigames or other freebies). The problem for pirates who want to distribute the game should be pretty clear - especially if the encryption on the actual game software is pretty high.

What do you think? would this work? does it meet all of Shamus’ criteria for a solution to the problem?

Shamus has a three part series on PC game piracy in which he makes some concrete recommendations to the game industry. Part of Shamus’ premise is simply that video game piracy is a problem partly driven by the industry itself, with ever-increasing paranoid reliance on clumsy copy protection and authentication schemes that treat ordinary users like criminals and which do nothing to deter the thieves. He argues that the industry should accept a baseline level of piracy and attempt to incentivize users to buy the product rather than attempt to forestall it completely. His specific recommendations are:

1. Make sure the pirates can’t offer a superior product
2. Get closer to the community
3. Offer a demo
4. Entice them with valuable updates
5. Clean House

How does this apply to anime? It occurs to me that the rationale for the fansub industry is quite similar to game piracy. Region-encoding, release schedules, and unequal pricing seem to be the methods by which the anime industry attempts to control their product and which has created the vacuum which fansubbers have rushed to fill.

Do Shamus’ recommendations apply? It makes for an interesting thought experiment.

I tried to use the Netflix live-movie streaming service to watch Ghost in the Shell:Stand Alone Complex and was rewarded for it with this:

that was after I was told that Firefox was incompatible, then asked by Internet Explorer to download three things and install two others, and after jumpin through all those hoops, got various “you do not have permissions to access this content” dialog boxes. The coup de grace was the message above

This is crap, and Apple is headed down the same bogus road:

Sources say Apple plans to charge $3.99 a pop for 24-hour rentals. Since Apple may agree to pay closer to the $17 wholesale price paid by other retailers, it’s unclear whether iTunes might boost the price or take a small loss to help drive sales of Apple TV boxes and video iPod players.

Apple’s movie download service is going to crash and burn, and leave a bigger smoking crater than Circuit City’s ill-fated DivX did a few years back. Four bucks for 24 hour rentals?

The first company to let you click one button and download a movie - no frills, no subtitles, no disc extras, just the movie - directly to your DVD burner and stick that in your home theater DVD player is going to mint money, for themselves and for the movie studios. And yeah I’d pay five bucks a pop for that, and I’d ditch Netflix too.

Unfortunately it only took the music companies 20 years or so to figure out that DRM was Dumb Retail Marketing. Maybe we have to wait another 20 years for the movie studios to figure that out. By which time the whole concept of physical media will be obsolete anyway.

Warner Studios made a big splash this past week when they announced they were going to ditch HD-DVD in favor of Blu-Ray. The ripple effect of this hasn’t fully played out, but one consequence appears to be that the Lord of the Rings (and The Hobbit, one assumes) will only be on Blu-Ray:

According to Variety, New Line and HBO will follow Warner’s lead to side only with Blu-ray Disc. BBC Video, the company behind the popular high-definition nature documentary Planet Earth, has not yet publicly expressed its intentions with format exclusivity.

New Line already positions its Blu-ray Disc products with greater priority than the equivalent HD DVD. New Line’s first high-definition film, Hairspray, hit Blu-ray Disc in late November 2007, while an HD DVD version was only promised sometime in early 2008.
[...]
Perhaps the most important outcome of New Line’s upcoming decision is that the studio owns the rights to The Lord of The Rings trilogy. Should the (second) most compelling motion picture trilogy hit high-definition home video, it’ll be on Blu-ray Disc.

If anything, this means that it’s better to just stick with legacy DVD and get my HD content via the internet. At least until the price of Blu Ray drives falls to the $100 mark or below (territory already occupied by HD-DVD). It also should be noted from the article that part of the reason for the preference of Blu-Ray is again the region-coding issue.

the last holdout, Sony, admits defeat:

In a move that would mark the end of a digital music era, Sony BMG Music Entertainment is finalizing plans to sell songs without the copyright protection software that has long restricted the use of music downloaded from the Internet, BusinessWeek.com has learned. Sony BMG, a joint venture of Sony (SNE) and Bertelsmann, will make at least part of its collection available without so-called digital rights management, or DRM, software some time in the first quarter, according to people familiar with the matter.

Sony BMG would become the last of the top four music labels to drop DRM, following Warner Music Group (WMG), which in late December said it would sell DRM-free songs through Amazon.com’s (AMZN) digital music store. EMI and Vivendi’s Universal Music Group announced their plans for DRM-free downloads earlier in 2007.

Given this, what will Apple’s excuse be for maintaining DRM on the iPod? Attention Steve Jobs! Doesn’t music want to be free?

Cause:

In legal documents in its federal case against Jeffrey Howell, a Scottsdale, Ariz., man who kept a collection of about 2,000 music recordings on his personal computer, the industry maintains that it is illegal for someone who has legally purchased a CD to transfer that music into his computer.

The industry’s lawyer in the case, Ira Schwartz, argues in a brief filed earlier this month that the MP3 files Howell made on his computer from legally bought CDs are “unauthorized copies” of copyrighted recordings.

Backlash:

In 2007, 83.9 million albums were sold, down 21.4 million from last year. A 20 percent drop in sales is more than a blip; it’s serious trouble.

The industry has been under pressure for years, of course. Back in August, we took a detailed look at trends in the movie, music, and video game businesses and noted that RIAA companies have seen sales drop by 11.6 percent between 2002 and 2006, even as movies hold steady and games are showing sales increases.

Effect:

the Warner Music Group said on Thursday that it would sell songs and albums without anticopying software through Amazon’s fledgling digital music service. [...] Warner is the third of the four major music corporations to reconsider its use of so-called digital rights management software, known by its initials as D.R.M., and offer its catalog in the unrestricted MP3 format. [...] EMI Group broke ranks with the other major labels and agreed to sell unprotected music through iTunes in April.

Now, some music executives are privately backing the idea of dropping the software from music sold through virtually every service except iTunes, in order to strengthen Apple’s rivals and potentially diminish Mr. Jobs’s advantage. The major labels have been upset with Apple’s inflexibility on music pricing, among other issues.

Warner’s move comes roughly four months after the industry’s biggest company, Universal Music Group, part of Vivendi, said it would sell music without restrictions through an array of services, including digital stores run by Wal-Mart, Real Networks and Amazon, but not iTunes.

Denial:

Apple and Fox have indeed (finally) agreed on an iTunes movie deal, and while details are admittedly scant at the moment, chances are Stevie J. will get to the nitty gritty come Macworld. What we do know, however, is that the alleged partnership will enable iTunes users to rent new Fox DVD releases and keep them around “for a limited time,” though pricing figures weren’t speculated upon. Additionally, it sounds like Fox will be spreading its digital file inclusion from select titles to all flicks, giving DVD purchasers a FairPlay protected file that can easily be transferred (read: without third-party transcoding software) to a computer and / or iPod for later viewing.

Apple is betting on the wrong horse here. I’m coming around to the view that Steve Jobs’ famous anti-DRM letter was just a negotiating tactic and didn’t represent any genuine pro-fair-use sentiment.

Toyota wants Sony’s robotics expertise:

According to the AP, the two companies will be working together to develop an “innovative, intelligent, single-seat vehicle” as part of a deal that stems from Toyota’s acquisition of various Sony technology and patents earlier this year. Under the new partnership, seven Sony researchers have started to work temporarily in Toyota’s robot research unit, helping Toyota make sense of the technology.

Cue the Aibo/DRM jokes.

A few days ago, HeadGeek at AICN declared he’d taken sides in the nextgen-DVD format war: he chose HD-DVD. I am inclined to follow his lead. At present I am in no position to purchase a HDTV (without which the choice of DVD format is moot), but I am confident enough in HD-DVD to make the decision well in advance.

There are a number of reasons why HD-DVD makes more sense. The fundamental reason, however, is simple: HD-DVD is backwards-compatible with standard DVD. Couple this with the fact that I will have to buy a new DVD player anyway once I upgrade to HDTV (which will be mandatory as of February 17th, 2009). My aging DVD player doesn’t support progressive scan, so watching DVD movies with my old player on a new HDTV would be masochistic. I anticipate that my TV viewing will be driven more by Blockbuster and BitTorrent than by broadcast, so the choice of DVD player becomes even more important. With a single box that supports upscaling like the Toshiba HD-A2 ($250 at Amazon), I get the full benefits of the HD resolution with my existing DVD library as well as any HD content I might be inclined to rent.

The other primary factor is cost. HD-DVD is simply cheaper, and maintains a healthy price advantage over Blu-Ray even despite recent moves by Sony to reduce the price. The irony here is that while BR players are overpriced now, they are likely to become very cheap in the future, because you can always get one at a subsidized cost by buying a Playstation 3. So there’s even more incentive to wait. The price of any gaming console is guaranteed to drop over time; witness that the PS2 now sells for $129. If at some point I do decide that I want a BR version of Lion King (Disney is exclusively BR), I’ll go and buy a PS3 and get maximum value; I anticipate we will see the PS3 at the $300 price point within a few years, especially as the Wii and XBox continue to clean Sony’s clock.

Much has been made of the fact that Blu-Ray enjoys wider studio support, but if there ever really is a movie truly exclusive to BR that I must have, I still can buy the standard DVD and upconvert on the A2, or I can bittorrent it down and watch on my HDTV (DRM on both formats is irreversibly compromised). But how likely is that anyway? Given that King Kong is out on HD-DVD, I’m not worried about Lord of the Rings following suit; and I’m enough of a purist about Star Wars that if Lucas gets his head out of his arse and gives me the Original, Unedited Trilogy (i.e., Han shoots first, etc) then that’s worth buying a PS3 for. Later. I can wait.

All the debate about which format is winning, based on sales, is essentially bogus anyway. The actual numbers of players sold is so insignificant thus far that any advantage enjoyed by one or the other is illusory and can’t be used to predict the longer-term trend. So I’m not worried about being locked into a “losing” format like BetaMax - again, at a bare minimum I will have backwards, upscaling compatibility with my existing DVDs. As far as I am concerned, the “format war” is just hype.

And anyway, Sony is evil. Some things you just can’t forgive.

Ars takes the new BitTorrent video store for a spin and finds unsurprisingly that DRM renders it useless. Off the top of my head,here’s what a genuinely successful online video store is going to require:

Intuitive. The interface should be identical to NetFlix, with genres down one side and a search box. A Queue functionality should be a given, with options to “subscribe” to shows.

Comprehensive. Every TV show that is currently broadcast or on cable should be available. Movies should have simultaneous release on the big screen and at the online store.

Value. No more than $1 per 30 min for movies, $1 an hour for TV. Hot picks or new releases could reasonably go double or triple that rate within a short time window, say three to four weeks. The price could decrement in stages over that time frame. Allow users to get a discount on TV show downloads if they opt for included TV commercials (which will be formatted as part of the content chapters, so they cant be skipped on the DVD burn). The purists can pay full price for the ad-free version. For movies, give the user a discount coupon for the soundtrack CD or a free movie rental at Blockbuster or Hollywood Video as a freebie (give those chains free ad space to cover their costs). Permit the user to apply discounts/pay a premium for higher or lower resolutions (ie, 50% for iPod or 150% for BluRay).

Burn to DVD. The vast, vast majority of video is seen on consumers’ expensive TV sets. Its still very rare for people to have a PC next to the TV set, and will be rare for a long time. HD-DVD and BluRay, not to mention the mandatory upgrade cost of HDTV for everyone within the next year or two, means that people have enough new media hardware to spend money on.

And what about DRM? First, let’s acknowledge reality: all DRM schemes are bogus to begin with.

Second: what Steve said. But more importantly: recognize that the lack of protection on audio CDs has not impeded sales. Note that you can burn iTunes tracks to CD as well. Theres no reason that burning to DVD would result in any threat to the studios’ revenue streams; in fact, I’d be able to burn a disc of great scifi show episodes and get my friends hooked. We could share video discs the way we did with mix tapes and CDs. The lack of any need for DRM on the files would also mean less overhead and increase profits to the studios directly.

Have I missed anything? If the studios build this, the consumers will come. Ultimately we shouldn’t even be wasting our broadcast spectrum on television; it should all be wired.