Sony issues recall for DRM crippled CDs

Sony totally caved on the DRM debacle:  They issued a recall of about 5 million CDs. I am pleased to have made a contribution to this debate. Kudos to Mark Russinovich for all his good work.

I bring an investor’s perspective to all this: Is the company tech savvy? Are they astute to their customer’s wants? Are they spending limited time and capital on worthwhile projects? With larger firms, how coordionated are the various divisions — is every group working well together, or is it a disparate colelction of parts working at cross purposes? 

From a bigger macro perspective, I want to key in on the emerging trends. What’s going on beneath the surface?

For example, consider the ongoing decline in dead tree circulation and the rise of online advertising. How are different elements of the media industry responding? The WSJ, the NYT, and Time Warner have each brought a seperate approach.

Then there is Forbes. One of the more ironic elements of this was how ass backwards they got this one. It wasn’t even a week after their shrill and embarrassing screed before they were shown up by the amateurs:

1. DRM restrictions were put on CDs without artists knowledge or permission
2. The copy protection scheme makes it difficult to put CDs on an iPod but does not stop piracy
3. Sunncomm, the DRM firm,will send you info how to circumvent the DRM upon request
4. Sony/BMG are using their consumers as pawns to fight against Apple’s iPod
5. The Rootkit infection was discovered by a blogger
6. Malicious virus writers had already taken advantage of Sony’s "ineptware"
7.   Sony’s Web-based XCP Uninstaller iopened up an even bigger security hole
8. The Sony EULA contained sone of the mose ridiculous (and unenforceable) legal restrictions ever seen
9. Correctly predicted the class action suits


How totally embarrassing is that?

So the question I have for Forbes is this:  Was Sony "blog bashed?"  Or, did they engage in some very bad business behavior that 1) alienated their customers; b) put PCs at risk; iii)  cost the firm alot of money to fix; D)  all of the above?

Bloggers keep finding things the mainstream media misses. Is it any surprise that newspapers and magazine circulation keeps sliding? Instead of whining about Blogs, outfits like Forbes should figure out what they are offering that dead tree magazines are not, and adapt. Better do it soon, too.

Here’s the key excerpt from today’s NYT:

The global music giant Sony BMG yesterday announced plans to recall millions of CD’s by at least 20 artists – from the crooners Celine Dion and Neil Diamond to the country-rock act Van Zant – because they contain copy restriction software that poses risks to the computers of consumers.

The move, more commonly associated with collapsing baby strollers, exploding batteries, or cars with faulty brakes, is expected to cost the company tens of millions of dollars. Sony BMG said that all CD’s containing the software would be removed from retail outlets and that exchanges would be offered to consumers who had bought any of them.

A toll-free number and e-mail message inquiry system will also be set up on the Sony BMG Web site,

"We deeply regret any inconvenience this may cause our customers," the company said in a letter that it said it would post on its Web site, "and are committed to making this situation right." Neither representatives of Sony BMG nor the British company First 4 Internet, which developed the copy protection software, would comment further.

Sony BMG estimated last week that about five million discs – some 49 different titles – had been shipped with the problematic software, and about two million had been sold.

Amazing . . .

UPDATE: November 17, 2005 5:46am PST

There’s a complete Sony rootkit roundup over at boing boing.

CD’s Recalled for Posing Risk to PC’s
NYT, November 16, 2005

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  1. cm commented on Nov 16

    And then there are allegations that the copy protection software contains “pirated” pieces of open source software that are distributed in violation of their respective licenses. Supposedly they are in DLL form, and as such I speculate the rootkit may try to replace libraries of ripping/playing tools with versions that degrade the audio. But then that’s my speculation. Here some links on it with further references in them. The slashdot entry is a tedious read, and the picture has to be puzzled together from many dispersed tidbits.

  2. cm commented on Nov 16

    I had my hands on a protected (library) CD only last week (via somebody’s recomendation to check it out), but had returned it before the story broke. When putting it into my Windows machine (to listen in while using the computer), the software started, and the audio was garbled. I did not click anywhere, but repeated the process with Task Manager ready, so I was able to kill their autorun program while it started from the CD, and could listen to the ungarbled audio. The music did not appeal that much to me. My CD player played it without problems, but it is in the living room while I was using my computer in the study.

    If I would have wanted to copy it I could have done it on my Linux machine, I just wanted to listen to it on the side where I just happened to have some business, dammit.

  3. The Capitalist Resistance commented on Nov 16

    Sony issues recall for DRM crippled CDs

    Link: The Big Picture: Sony issues recall for DRM crippled CDs. I saw this on CNBC last night. I have a simple response: Support taper friendly artists and listen to live music.

  4. Nicholas D. Slabaugh commented on Nov 27

    I have to say that this step is a huge victory on a couple fronts. First and most obviously the DRM front; companies now must at least ensure that their DRM is safe before inflicting it upon us. Second, for bloggers; congratulations, New York Times, but I heard about it about 37 hours ago on 4 different sites.

    The whole issue really turned out to be a good thing. I feel bad for those negatively affected by the DRM trojan, but at the same time their discomfort was to the overall gain of the country.

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