The motivations for piracy

Indie game developer Wolfire Games recently created a limited-time sale, The Humble Bundle, which combines six generally well-received games from separate developers into one pay-what-you-want package with no limits on download quantity, no DRM, no authentication, no keys.  Buyers could also specify which percentages of their purchase price would go to the developers, and which would go to charities such as Child's Play or the EFF.  They offered credit card payment options via Paypal, Amazon, and Google Checkout, and the few people that e-mailed Wolfire regarding their inability to pay via those methods were treated to a free bundle on the house for the inconvenience.  I think this was an important event in the world of internet consumerism and specifically digital software distribution.

Digital Rights Management has sparked an ongoing debate in certain gaming- and tech-minded circles, regarding the balance between a publisher's rights to prevent piracy and the consumer's rights to not be inconvenienced or harassed by an overbearing publisher.  Gaming giant Ubisoft, publisher of the Assassins Creed line, recently required constant internet connections and server authentication for single-player play of Assassins Creed 2, which they argue is a step towards preventing pirated copies of AC2 from being played.  It seemed only appropriate, in terms of cosmic irony, that the AC2 authentication servers crashed on day 2 and prevented every single person on Earth from playing for 24 hours.  This particular implementation of DRM also means no PC user could ever play this game on a laptop that wasn't in a (free) wifi spot, or on a desktop experiencing an internet outage.  If you drop connection to the Ubisoft servers mid-game, AC2 locks you out of the game (and erases all progress since your last save) until it can reconnect.

Sony's Playstation 3 frequently updates its firmware whenever Sony discovers that some enterprising young hacker has cracked the hardware's encryption schemes.  To combat the most recent cracking attempts, Sony has eliminated the PS3's ability to load alternative operating systems, a feature that sold at least a handful of units to Linux users.  Their online store, Playstation Network, is also heavily locked down with DRM.  A recent leap-year-related hardware glitch on a specific clock chip in older PS3 models caused a system clock error that prevented perhaps half their user base from accessing PSN.  PSN is used for trophy syncing.  Almost all modern PS3 games sync trophies at game launch.  Therefore everyone who couldn't get onto PSN was also locked out of playing even single-player games for almost four days, and unplugging the network cable didn't fix the problem.

Large game developers say they've been forced into implementing such draconian DRM because piracy severely impacts their bottom line.  I don't think we'll ever know exactly how much money EA or Activision loses to pirates, but the number is nonzero, so they have something of a point.  The flip side of the argument is much more fun to explore, and is something Wolfire just broke wide open.

There are many defenses software and media pirates use to justify their copyright infringement:

• It's not theft if I just make a copy.  I'm not denying anybody anything.
• You can't own information.  Data is free.  I'm just copying information.  It's not a crime because copyright doesn't exist.
• I'd buy it legitimately if it wasn't so egregiously expensive.  Their pricing scheme forced me.
• I don't agree with their DRM, so I wanted a hacked copy.
• Why do I want to give money to a big publisher?  The coders/artists that actually made the software/song/movie hardly see any of that cash.
• I don't trust credit card transactions, so I'll download it from some Russian torrent site instead.
• I wouldn't have paid money anyway, so it's not like they're losing a sale.
• If there's no demo, I'm not paying money for it.

This can lead to some pretty epic defenses of pirate activity, like this thread at a tech-heavy web forum.  I generally find the sum of these arguments to be the equivalent of the "I'm not touching you!" defense.  You know, when you stick your index finger a millimeter away from your sibling's face.  In a technical sense, no, you're not touching him/her, but you're still being an annoying twat.  In a technical sense, it's not literally theft, but it's the spirit of thievery and denying someone monetary compensation for their work.  If information is free, then surely so is that collection of atoms sitting in your house in the form of a large-screen television and your pile of bank statements.  Running over some pedestrian with your car isn't technically murder under the law, but it sure as hell is manslaughter.  Etc.

So what happened last week was pretty interesting.  Wolfire's bundle sale eliminated many of the purported barriers to legitimate purchases.  Its developers get paid for their own direct work, you can pay whatever price you want, you can send the money to charity if you want, there's no DRM, and if paying by credit card is too hard you can actually just e-mail Wolfire and you get your bundle on the house.

I think it's a big deal that on monday Wolfire's blog had an entry that stated, based on some loose in-house statistics, that 25% of their website downloads were pirate downloads.  This doesn't include torrent activity.  When you buy the bundle, they e-mail you a link to the download page, but there's no tracking and no account information being processed, no IDs or logins, no authentication.  You can share the link with anyone, as occurred on many forums across the globe.

On the one hand, 25% piracy is probably pretty low for a computer game with no DRM.  On the other, you could literally pay one penny and have that counted as a legitimate sale, and 25% of individuals decided that one penny was just too much to handle, or that payment via credit card was too troublesome (and let's face it, the people who read the websites to be informed about the humble bundle are precisely the kinds of people who already have PayPal and Amazon accounts).  Frenzied back-and-forths are occuring across the internet, trying to exlpain away the 25% (I have seven computers!  It was all kids without credit cards!) or demonize the pirate crowd (One cent was too much, eh?).

Wolfire's response to this is entertaining.  Instead of righteous indignation and publicly outing the worst of the link-sharers, they offered this conclusion:

When considering any kind of DRM, we have to ask ourselves, "How many legitimate users is it ok to inconvenience in order to reduce piracy?" The answer should be none.

I think this is an important step in distancing the course of the digital economy from increasingly restrictive DRM policies.  Piracy cannot be stopped.   Wolfire just demonstrated that eliminating the main excuses for piracy still results in rampant piracy.  However, the runaway success of the bundle sale ($956,704 raised at the time of this writing) suggests that there are price platforms and schemes where piracy can be rendered irrelevant.  I'm looking forward to seeing if other publishers and software distributors attempt similar sales with slightly different parameters (some DRM, or fixed prices) and gaining some insight on how the variables affect the bottom line.

A DRM-free environment is something I find more palatable than a universal DRM-ridden subscription-software based model.

I'll reflect further on this while I'm playing UT2004 tonight.

Late edit links:
Rock, Paper, Shotgun is frustrated with Ubisoft's always-on DRM.
Ars Technica trolls its reader base to poke the piracy beehive
Joystiq discusses pending litigation against Sony for their pursuit of DRM nirvana