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Aaron Swartz - On Peer To Peer, Digital Rights Management and Web 2.0
San Francisco, April 2007 
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From its inception in 1999, Napster was pursued by the music industry who succeeded in shutting it down. By doing so, they drove users towards decentralized methods of sharing with no centralized point of weakness. This was made possible network architecture or the so-called 'end-to-end principle'. Swartz outlines how thereafter industry tried other approaches such as digital rights management, which collided with the essential nature of computers as copying machines, and legal threats. While none of these strategies succeeded in stopping sharing, they have impeded the further development of p2p technologies (ion this see also Fred von Lohmann's interview). Arguably these events have encouraged a shift towards web 2.0 sites where users hand over control of their work to centralized sites based on advertising models. Could this trend be reversed in the future?

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00:00:04 Ever since Napster, the music industry has been trying to kill filesharing.
00:00:09 Napster was this huge global party of you know...
00:00:12 Everybody suddenly had access the largest music library in the world
00:00:15 and what'd they do, well they went after Napster and shut it down.
00:00:18 Well it completely backfired, you know, they shattered Napster into millions of little pieces
00:00:22 spread across computers all around the globe.
00:00:25 And now if you want to shut it down you have to track down every single one of them
00:00:28 and turn it off, and they just can't do that.
00:00:31 They send out letters every month trying to shut down a couple here and there,
00:00:34 but it just doesn't work, you know, there are just too many, it's out of the bag now.
00:00:39 Once it's that far distributed it's really going to be be hopeless,
00:00:42 They have various technical attacks of spoofing, legal attacks
00:00:47 threatening to sue people, but it's just too late, filesharing isn't going to go away.
00:00:52 The music industry, if they want to stop file-sharing,
00:00:54 there's no central computer for them to go to and shut it down.
00:00:57 They have to go all the way to the ends of every wire,
00:01:00 and they have to snip all the cords across the globe if they want to try and stop it.
00:01:04 The network is built so that there's nobody in charge,
00:01:07 that everybody has control over their own communications.
00:01:14 So the fascinating thing about the internet is it's built around this thing called
00:01:17 the end-to-end-principle, which says that all the intelligence is at the ends of the network.
00:01:21 If I want to talk to Fred it's my computer and Fred's computer that's in charge,
00:01:26 in between there's just a bunch of wires. At a very concrete level
00:01:29 I have a wire to my ISP who has a wire to a data center somewhere,
00:01:33 who has a wire to Fred's ISP who has a wire to Fred.
00:01:35 There's no central computer in charge that you can go to and shut down and say "no filesharing"
00:01:39 They have to go and find my computer and Fred's and take us out,
00:01:43 or they have to snip all the wires across the globe.
00:01:45 There's nobody you can go to and say "shut down file-sharing!"
00:01:48 it's just not built that way.
00:01:54 The entertainment industry thinks they can solve this problem by using something called DRM,
00:01:57 which basically means locking up all their songs using encryption.
00:02:01 But there's this fundamental mistake they've made
00:02:04 which is that like if you lock up a song before you play it you have to unlock it
00:02:08 and if i'm playing it on my computer my computer has to unlock it
00:02:11 and since I own my computer I've unlocked the song.
00:02:15 It's this very obvious mistake they just can't seem to get through their heads,
00:02:19 if my computer is unlocking the song, I can tell it to make a copy when it's done unlocking it.
00:02:24 There's no way around that, and so if you see every DRM system gets broken,
00:02:30 the Apple system has gotten broken, the DRM on DVDs has gotten broken -
00:02:33 no matter what you do it's going to get broken.
00:02:36 And it's also kind of idiotic because even if the DRM systems weren't broken
00:02:41 there are lots of other ways to get movies, not just downloading it from the iTunes music store.
00:02:46 You can go out to a theatre and take a copy of a print, you can have a video camera,
00:02:51 you can have a screener that they send out to people, there's tons of ways to get this stuff.
00:02:56 Putting DRM on the handful that happen to go to consumers isn't going to change anything.
00:03:01 Instead what a lot of people have suggested is that DRM is a way of handcuffing users
00:03:05 or saying OK we'll give you our stuff, but you can only watch it five times on four machines,
00:03:10 and only watch it when we say so and we can de-activate it when we're done with it,
00:03:13 we have control over how you experience our film.
00:03:17 That makes a lot more sense, it's harder to prove obviously but
00:03:21 it's certainly much more compatible with the way that they've been behaving.
00:03:24 Network is a copy machine.
00:03:26 Every single time you do something on your computer, it makes a copy.
00:03:31 First it copies it into your computer's memory, then it copies it to your computer's CPU,
00:03:35 then it copies it out to the network, in every step along the way from
00:03:39 you to the person you're talking to it makes another copy.
00:03:41 The entire system works because it's digital and because copies are free.
00:03:44 Everything works by making copies on a computer, you're not going to stop that.
00:03:49 It's the simple economics of supply and demand.
00:03:51 If you have one of something, you can sell it to the highest bidder
00:03:55 for the highest price, whatever anybody in the world is willing to pay
00:03:58 you can sell it to them for that.
00:03:59 If you have two then you can only sell it for what the second highest bidder is willing to pay.
00:04:03 If you have millions of them the only thing you're going to be able to
00:04:06 charge for is the cost of making another copy.
00:04:08 'Cause otherwise someone's always going to be willing to sell it for cheaper.
00:04:11 On the internet the cost of making one additional copy is free
00:04:15 the so called marginal cost is zero so everything gets driven down to free.
00:04:20 You're not going to be able to make money through the old model of selling
00:04:23 individual copies any more because there are just to many of them.
00:04:25 You're going to have to go to other schemes.
00:04:28 The entertainment industry is desperately trying to save their old business model,
00:04:31 they're going round saying how can we to patch up and continue doing
00:04:35 things the way we've done before. That's just not going to work.
00:04:39 They can try and continue this rearguard actions like DRM and lawsuits,
00:04:42 but eventually they're going to have to change their tune.
00:04:47 So there are alternatives, there are sites like which are like Youtube,
00:04:51 except everytime an add gets shown with your movie, you get some of the money from the add.
00:04:54 The problem is that the users don't seem to care about it enough.
00:04:58 Each individual movie only makes 30 or 40 cents and it's just not worth it to you
00:05:03 to go and put it up on a smaller site like Rever when you can get the huge audience of Youtube,
00:05:07 and, you know, forget the 40 cents.
00:05:09 But these little 40 cents add up, with the millions and millions of movies on Youtube
00:05:14 suddenly we are talking about millions of dollars of revenue.
00:05:17 So you have this weird trade-off, where each little bit's not worth it enough to users
00:05:23 but on the whole companies are prepared to pay a lot of money for it.
00:05:27 There's no technical reason users can't do this for themselves,
00:05:30 but there's an economic reason which is that
00:05:32 building the software takes money and programers,
00:05:35 and the venture capitalist are only going to pour money
00:05:38 in to the things that have a high chance of return.
00:05:40 which means the centralized sites that run adds and take the money for themselves.
00:05:44 So yeah sure, it's technically possible that we could develop this distributed system
00:05:47 and in fact that was the way that the way that the internet was originally set up
00:05:50 People put their stuff on their own computers and when they hooked them up to the internet
00:05:54 people visited their own machine and they controlled their own data.
00:05:57 The fact is that could've worked, that's just as reasonable of way of doing it than ?any way else?.
00:06:03 The problem is that's just not the where the money is, and when software gets funded
00:06:07 it gets funded where the money is.
00:06:09 There are two big problems, one is technical and one is political.
00:06:13 The technical problem is that basicly computers, people's machines at home,
00:06:19 don't have the power of servers.
00:06:21 They're not on all the time, people buy this cable modems that don't have the
00:06:26 high enough upload bandwidth to be popular.
00:06:29 Cable companies have people signing user- agreements
00:06:33 saying they can't run servers from home.
00:06:34 So if you want to do something like host a youtube video
00:06:37 it's just kind of impractical to host it off of your computer, let alone your laptop
00:06:41 that you pick up and take home with you. So it's really hard for normal people to run servers.
00:06:46 So that's a technical problem, it means
00:06:48 at some point you're going to have to upload your video to somebody's server
00:06:51 somewhere else where it is run reliably, and that means inevitably giving up a measure of control.
00:06:55 So the question that comes is who do you give the control to, and users just don't care enough.
00:07:00 Wether it's Youtube or it's Amazon or somebody who's signed an agreement with them.
00:07:05 They just don't care who they give it too, the simplest thing is the best,
00:07:08 whatever gets their movie up, that's all that matters to them.
00:07:12 I mean It sucks each time it sucks when somebody takes
00:07:14 advantage of your stuff just to make money for themselves.
00:07:17 But each time it's not enough for you to do something about it
00:07:20 each time it's OK, "oh well know they got my videos that sucks",
00:07:24 or "they got my photos that sucks" or "they got my email now that sucks"
00:07:28 They just don't put it together, there's no tipping point
00:07:31 where you say "OK finally I am fed up and I'm not going to take it anymore!
00:07:35 I am taking back my computer!"
00:07:37 It just doesn't happen, it's another one of myriad little pains.