Wednesday, November 07, 2007

Build your wealth

One of the keys to building wealth is to buy rather than rent. The idea is that even if it costs more to buy something initially, generally you will same more money in the long run. For example if you want to get a tv it would be a wiser decision to save up the money for it rather than rent it right away, because once you stop paying the rent, the tv and your money is gone. Ok that is over simplifying a bit, but I am going somewhere with this.

If you buy media that has Digital Rights Management (DRM) on it you are not actually purchasing it. You are renting it. If the content owner (don't be fooled by this phrase, even though you "bought" the content you do not own it) decides that you have had enough time with your purchase they can pull the plug and everything you bought from them is gone.

What has DRM on it? Well almost any media purchase that is downloaded over the internet (one big name would be iTunes). If you have doubts that a company would disable something that you bought check out this story:

Background: Beginning in 2003, MLB offered fans the chance to download full games to their computer at $3.95 each. When you attempted to open the media file -- either on your hard drive or after it was burned to a CD -- it connected with a webpage to obtain a license. Once the license had been verified, the game would play.
At some point during 2006, MLB deleted that essential webpage. Since then, none of the videos that fans purchased will play.

He contacted the MLB customer service and they said:

"MLB no longer supports the DDS system" that it once used and so any CDs with downloaded games on them "are no good. They will not work with the current system."
I was told there is absolutely nothing MLB can do about these lost games. Plus, they said my purchases were all "one-time sales" and thus "there are no refunds".

So just a warning to put out there, if you "purchase" something with DRM on it, you are at the mercy of who you are renting it from, and your investment can be worth nothing whenever they feel like screwing you.


Think Frustrated said...

Yeah, but I don't think the DRMs work the same way on downloaded songs. Maybe I'm wrong.

Oh, and my word verification is honestly "techd" I thought that was convenient.

Ookami Snow said...

They work in different ways and downloaded content usually is more at the mercy of the company that owns the content. But even buying a CD that has DRM means that they can limit the usefulness of owning the CD, such as not allowing you to rip the music.

I don't really think that they have the ability to kill CDs on a whim, but keep an eye out for HD-DVDs and Blu-Ray.

And techd is a very fitting word verification.

Think Frustrated said...

That's right. The DRMs on iTunes songs restricts you from copying them to another iTunes account. Let's say I paid for an album from iTunes, then burned it on a CD for you, and you put it in your iTunes. It will ask you for my password, and will only allow that license on a total of 5 computers.

Ookami Snow said...

And if you bought the actual CD without DRM you could put it on as many computers as you want.

Braveharte said...

This isn't really a new thing though... VHS used to have that thing that prevented you from copying it too (I don't recall how good it was though...).