But even so, we see no need for stronger copyright laws, or strong Digital Rights Management software, because existing law allows us to prosecute the few deliberate pirates.....

Lesson 5: File sharing networks don't threaten book, music, or film publishing. They threaten existing publishers.

The music and film industries like to suggest that file sharing networks will destroy their industries.

Those who make this argument completely fail to understand the nature of publishing. Publishing is not a role that will be undone by any new technology, since its existence is mandated by mathematics. Millions of buyers and millions of sellers cannot find one another without one or more middlemen who, like a kind of step-down transformer, segment the market into more manageable pieces. In fact, there is usually a rich ecology of middlemen. Publishers aggregate authors for retailers. Retailers aggregate customers for publishers. Wholesalers aggregate small publishers for retailers and small retailers for publishers. Specialty distributors find ways into non-standard channels.....

Lesson 6: "Free" is eventually replaced by a higher-quality paid service

A question for my readers: How many of you still get your email via peer-to-peer UUCP dialups or the old "free" Internet, and how many of you pay $19.95 a month or more to an ISP? How many of you watch "free" television over the airwaves, and how many of you pay $20-$60 a month for cable or satellite television? (Not to mention continue to rent movies on videotape and DVD, and purchasing physical copies of your favorites.)

Services like Kazaa flourish in the absence of competitive alternatives. I confidently predict that once the music industry provides a service that provides access to all the same songs, freedom from onerous copy-restriction, more accurate metadata and other added value, there will be hundreds of millions of paying subscribers.....

Lesson 7: There's more than one way to do it.

A study of other media marketplaces shows, though, that there is no single silver-bullet solution. A smart company maximizes revenue through all its channels, realizing that its real opportunity comes when it serves the customer who ultimately pays its bills.

At O'Reilly, we've been experimenting with online distribution of our books for years. We know that we must offer a compelling online alternative before someone else does. As the Hawaiian proverb says, "No one promised us tomorrow." Competition with free alternatives forces us to explore new distribution media and new forms of publishing.....