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commercial strategy

Spore: DRM and commercial strategy

by Andrew Watson on 17 October 2008

Just because you can legally and technically lock something down doesn’t mean you should. Earlier this week I wrote about DRM in the context of RealDVD and using it as a hook to provide other restrictions. The ongoing saga over Spore‘s DRM is an example of where maxmizing restrictions on users through DRM can backfire commercially.

The short version of the Spore story is that Electronic Arts (EA) spent tons of money and used game designer hotshot Will Wright (The Sims) for a new highly-anticipated massive online game: Spore. The game shipped with DRM technology that limited it to three installs, which could cause problems for users who have hardware failures or regularly wipe and install on their machines.  There was a backlash and EA has since changed around the settings and increased the install limit (though apparently not before a class action lawsuit over the DRM).

A comment yesterday from Will Wright (via Kotaku) about the decision to use DRM in Spore got me thinking further about DRM and strategy:

It was something I probably should have tuned into more. It was a corporate decision to go with DRM on Spore.


I think it’s an interim solution to an interim problem. … I think we’re in this uncomfortable spot in going from what’s primarily a brick and mortar shrink-wrapped product to what eventually will become more of an online monetization model.

When DRM starts to get genuinely in the way of the user experience is when companies should strongly think about how the legal and commercial strategy fit together.

In this case, it’s a question of managing expectations on the part of consumers: trying to lock users down to specific limits versus the expectations around ownership after purchase. EA had restrictions that didn’t meet customer expectations and so their product launch was marred by some controversy.

What I think is really interesting is to compare the experience of EA and Spore with the Real DVD / DVD-CCA situation. The DVD Copy Control Association isn’t directly consumer facing – it targets manufacturers and developers around DVDs.  As a result it can act with less consumer outcry because its restrictions happen across an entire platform (DVDs) versus EA and Spore. Spore is one specific type of product out of a sea of other products and platforms (one game among many different games on different hardware with different DRM models).

It is far less noticeable from a consumer point of view when an entire media set such as DVD and DVD players all have the same restrictions (such as Regional Playback limiting use to specific geographical areas) no matter what product you buy from any manufacturer.

Both decisions to use DRM however were tied to preserving a business model in light of ongoing innovation. One was tied to a specific product (Spore) and the other tied into setting standards for an entire market (DVD-CCA).

All of the commentary above does however sets aside some of the larger issues around DRM, including whether the arms race against hackers makes it ultimately a worthwhile pursuit, as well as legal and policy issues surrounding fair use / fair dealing and DRM / TPMs that restrict these rights.

But those discussions will have to be for another post.