Via Yahoo:

BOSTON – It’s been the better part of a decade since Napster and other free song-sharing services began scaring the daylights of the music industry. And still recording companies can’t find an effective anti-piracy technology to save their hides. The fact that so-called digital rights management might always be a doomed experiment became painfully clear with the fiasco that erupted after Sony BMG Music Entertainment added a technology known as XCP to more than 50 popular CDs. After it was discovered that XCP opened gaping security holes in users’ computers — as did the method Sony BMG offered for removing XCP – Sony BMG was forced to recall the discs this week. Some 4.7 million had been made and 2.1 million sold. Factor in lawsuits that Sony BMG could face, and it’s worth wondering whether the costs of XCP and its aftermath might even exceed whatever piracy losses the company would have suffered without it. That’s not even accounting for the huge public relations backlash that hit Sony BMG, the second-largest music label, half-owned by Sony Corp and half by Bertelsmann AG. “I think they’ve set back audio CD protection by years,” said Richard M. Smith, an Internet privacy and security consultant. “Nobody will want to pull a ‘Sony’ now.” Phil Leigh, analyst for Inside Digital Media, said the debacle shows just how reluctant the labels are to change their business model to reflect the distribution powers — good and bad — of the Internet. He believes that rather than adopting technological methods to try to stop unauthorized copying of music, record companies need to do more to remove the incentive for piracy. “The biggest mistake the labels are making is, they’re letting their lawyers make technical decisions. Lawyers don’t have any better understanding of technology than a cow does algebra,” Leigh said. “They insist on chasing this white whale.” It’s easy to understand why the music industry wishes songs could magically be prevented from being ripped from CDs and shared freely. … [But] “It’s an arms race that the content owner can never win,” said Yankee Group analyst Michael Goodman. “In order to make it usable, you also have to make it beatable. If you really truly want to lock it down, it is possible to lock it down. But it is so onerous on the user that they’d never want to use it in the first place.”