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Comment: Econ 101 (Score 1) 350

by cbare (#13746881) Attached to: Surefire Way To Stifle Innovation
The free market works when participants in the market are rewarded in proportion to the amount of good they contribute. With DRM this proposition is reversed. Society gains less benefit from a protected work, but the owner of the work gets more reward. (Or so they hope.) On top of that, copy protection mechanisms invariably provide a less useful product even to the paying customers.

This simple bit of econ 101 explains why DRM is so universally reviled by consumers. The crux of the problem is that traditional market economics for manufactured goods like cars is based on marginal cost. For digital goods, the marginal cost approaches zero. Normal economics start to break down.

The other issue is that the publishing industry has set itself up as a middleman between the real content providers and consumers. They seek to use legislation to preserve this privileged position. A truely free-market approach would be to allow the middlemen to be made obsolete. This is what will happen eventually, the efforts of our toadying crony capitalist government notwithstanding.

We need to find market mechanisms that more closely align reward with contribution for the real content providers, the creative people. This is a tricky problem with no obvious solutions. For now, we'll have to put up with a lot of stupidity because so few people even clearly understand the problem.

The first rule of intelligent tinkering is to save all the parts. -- Paul Erlich