Comment by belorn | Hacker News Reader

Comment by belorn | Hacker News Reader

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We do live in a society based on evidence gathering, and thus market behavior should be based on it. My attempt to address the issue is mostly to point that out, and then do some observation regarding the market. Observation is the first step before evidence is gathered, while theory/best practice is the last step after Observation, evidence and analysis has proven something to be "true".

When people give out best practices, or gives out necessities of the market based on nothing but opinion and theory, it become pure myth and superstition. Sysadmin work which is my line of work, has a bunch of myths. Some people still making firewall rules against win95 ping of deaths, even if everyone in the company is running around with this years gadgets.

But you did ask if I have any evidence of my own, and here I relied on common sense and observations. DRM cost money, in both time, effort and support. Additional, I looked at the indy crowd of movie makes which has only has weak/no DRM, and the indy crowd of games which has all from strong to no DRM. What I can see, there are no major difference what so ever, and both groups often suffer from low revenues in products that later get critical acclaimed as a master piece.

But Im sorry, no, I do not have any research paper to support that observation. That would be the second step, through one can glimpse some truth by checking if anyone are disagreeing with it. Also, since DRM cost money, it should naturally require a higher burden of evidence to become best practice or necessity in the industry.

Minor note about Blade runner: It took several years before the movie reached a cult status. By the time it did, people started to have dual VHS players at home or could call some dude in the campus to do a copy.

I am just confused why you require a peer review study to prove DRM is good while your evidence it is bad is "common sense" and "well I think Blade Runner didn't make money till people passed around VHS tapes".

I do not think we need to provide evidence that a developers time cost money (ie, to code/acquire DRM software). Second, I don't think we need to provide evidence that running a server and having bandwidth to run authentication servers cost money. Last, I doubt we need to provide evidence that extra support calls thanks to DRM issues cost money.

Each three of those are what I call common sense, ie, we know them all to be true. Those are also the only assumptions I included in my "I relied on common sense and observations". The rest is observations, which is the first step in a honest and scientific discussion about the effect of DRM. First you do observations, second you collect evidence, third you do analysis and last you create theory. Only once you done each step and reached theory should economic decision be made in the case of including DRM to increase revenue. Before that, only the cost of DRM is know and everything else is speculations. Those speculations has both those that say its great and those that say its crap and there is nothing in the world that will convince them beyond a scientific approach.

How would you propose that such a study be performed?

The same game released with and without DRM? Different games with and without DRM?

Large sample size over as much types of media possible (game, music, movies, and software). Afterward, I would start digging down further by separating producers, market groups and market targets, and then do statistics to find correlations. I would ask questions like: Do a indy game being released on steam have similar economic characteristics of a indy movie being released on netflix.

Then I would collect data on piracy rate vs initial buy rate vs long tail and find product types that share those. Then, with all that data, one can start looking into DRM and individual products from groups with shared economic traits but which differ primarily on the DRM question. With a decent sample size, some kind of answer should pop out.

That would be my guess of a simplified study. Statisticians and economics has surely more to say on this and where the corner cases are. There might also be smaller studies to do if one accept some early assumptions.

I'm far from a statistician, but the difficulty in the study seems to be that you have products which are radically different from each other in demand structures.

How do you tell whether the sales delta is driven by DRM or a much, much higher quality artist?

If someone is out there on HN with some ideas, I'd love to hear them, not for this problem (I don't really care), but for other problems that may be difficult to solve later on.

> I'm far from a statistician, but the difficulty in the study seems to be that you have products which are radically different from each other in demand structures.

>How do you tell whether the sales delta is driven by DRM or a much, much higher quality artist?

I'm not going to weigh in on DRM vs. non DRM, but you'd get around that problem by explicit randomization. If you have enough observations then differences in quality, etc., literally average out. If you have more information up front you can randomize conditional on the observed characteristics, which reduces the number of observations you need.

They only average out if they're uncorrelated. I'd say it's pretty likely that high-budget, expensive games are more likely to be released with DRM than low-budget indie ones. You could try randomizing on budget, dev size, etc..., but there's really so many random variables to account for in game development (expected sales? platforms released on?) that you'd need a ton of data before you really got something that's statistically significant.

Although I'm no statistician either, so whatever.

Yeah, I should clarify that I meant you could do it if you control whether they're released under DRM or not. If a group of indie developers wanted to pool together and run an experiment, they could do it in a way that was really informative about its effect on revenues (the conclusions might not hold up if you tried to extrapolate too far beyond indie games though).

I agree that the existing data aren't much like the random experiment I was talking about.

Maybe, but what if indie games are less susceptible to piracy than blockbuster games.

There are really just massive statistical hurdles to overcome with this type of analysis.

You could prove that indie games with strict DRM will perform differently than indie games without strict DRM, but extrapolating that to feature, blockbuster games is problematic.

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