Matt Ingram has written a very good post at Giga about how Amazon came to have so much power over publishers. It was the publishers who insisted that digital books only be sold with DRM (digital rights management) padlocks on them. And so, they got locked into Amazon’s DRM system.
Is it time to ditch DRM? It is … if you agree with me that piracy is just a side show. The real event here in terms of business strategy is to use the internet to give people more of what they want. Imposing restrictions doesn’t do that. And it doesn’t generate revenue. As the man says, people who read a book for free probably were not about to buy it anyway. So the revenue loss from piracy is a mirage. And the potential revenue gain from giving more flexibility to customers is not.
The truly amazing thing here is that the publishers paid no attention to the experience of the music industry. When they insisted on DRM for Itunes, the record labels gave the keys to the kingdom to Apple. They saw the mistake too late but they did see it. You might have thought that the publishers were paying attention. But nope. Just as the record labels were trying to get out of their DRM prison at Apple, the publishers were lining up to enter their own the Amazon prison.