On Digital Distribution

Digital distribution seems to be the panacea of next-generation content delivery, but while I fully embrace it and hope more content providers will rely on digital distribution in the future, there are still some problems with it that need to be addressed before it can become a suitable replacement for physical products.

But first, the advantages of digital distribution.

Digital distribution is, well, digital, so there’s no physical media to worry about losing or scratching. Given the choice between buying a CD (music, game, whatever) or buying a downloaded version, I would much rather buy a downloaded one simply because I don’t have to find it when I want to use it. Steam and the current-gen console services all have shown that digital distribution is feasible for games, and more and more games are going to be released in digital form in the future.

Digital distribution is also easier for couch-potato types, since you don’t even have to leave your couch/keyboard/whatever to buy something. The sheer convenience factor can also make it into an impulsive buy, since it just takes a few clicks to buy something. This is an advantage for both the producer and the consumer.

Lastly, digital distribution decreases production costs significantly, reducing them to basically the development and marketing costs. This is a big advantage for content providers, because there is less of a risk involved, and no inventory to worry about with an infinite supply. This allows for more creative and original content and gives smaller developers a greater chance to put out their products.

However, digital distribution is not without its faults and many of these advantages also turn into disadvantages.

Lack of physical media also kills the shareability of content. With a CD or a book, you can lend it to your friend after you’re done and extend the value of your purchase. Digital content almost necessarily must employ DRM, otherwise it would not be profitable for producers, but at the same time this destroys the ability to share found in physical media. Limited use DRM does provide a workaround for this, as in the case of the Zune’s 3 plays sharing, but it doesn’t offer the same flexibility as a physical object. In the realm of books, I hope that eReader devices such as the Kindle and Sony Reader would adopt similar technology, especially with the enormous initial investment for these devices, but I don’t know how likely this is to actually occur.

Internet speed is also a factor that cripples many forms of digital distribution. At least in the U. S., internet speeds are still not fast enough for the most part to allow rapid downloads of multi-gigabyte content such as new game releases and high definition movies. Although Verizon’s FiOS has theoretical maximum speeds of 50Mbps, it is only available in limited areas and the next best option is 8Mbps cable. Even then, these are maximum burst speeds, and real sustained speeds are going to be much lower. Although music and books may download fast at these speeds, a DVD quality movie would take 1.28 hours at the maximum 8Mbps speed, and with DSL or more realistic cable speeds that time gets much larger. Although that might be fine for something you watch multiple times, if you just watch it once renting would be faster. Games and big software could take even longer, potentially taking an entire day or more on 3Mbps DSL. Broader fiber penetration is a must if digital distribution is to completely replace physical distribution.

The last annoyance about digital distribution is price. Even with the drawbacks mentioned above, the price of an eBook is around the same price as a paperback, even though the paperback can be shared, thereby increasing its value. Logically, this does not make sense because there are very few production costs for digitally distributed content since there is no media. In addition, there is the added cost of the device that can read the content, since digital content cannot be read on its own. An average MP3 player costs around $250, and a good e-ink based eBook reader that finally has some of the advantages of paper will run from $300-400. It seems that the iPod got around this immense cost because MP3s can be ripped from CDs and/or pirated, not to mention its iconic status, but eBooks have no such advantage since scanning books is much more time consuming and their readers are not exactly flashy or slick yet (Kindle, I’m looking at you). Ideally, digitally distributed content should cost around 50-75% of the equivalent physical media because of reduced distribution costs for the producer.

In summary, digital content needs to become sharable in some way, broadband speeds in the US need to catch up with the rest of the developed world, and prices must be lower before digital distribution can replace physical media. I look forward to a day when everything is digital, but so far that is a distant dream (beyond piracy, of course, which is a whole other issue).

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1 Response to “On Digital Distribution”


  1. 1 Andrew Levine October 6, 2010 at 12:58 pm

    One other disadvantage is the playback quality. When I listen to my iPod in my car through an auxilliary port, the sound quality is not as good as a CD. When I buy music, I still buy CD’s. Good article on the advantages and disadvantages though, you hit on everything else.


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