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DRM (Digital rights management) is a somewhat controversial anti-piracy measure. There are strong arguments on both sides of the debate, this question is not about the should/shouldn't debate. It just about sales, does DRM have any impact on sales?

Are there any studies indicating an impact on sales based on the presence or absence of DRM on ebooks?

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I haven't found any solid studies, but Tor Books publishes all of its books DRM free. They claim it hasn't impacted business in a negative way. –  vcsjones Dec 27 '13 at 16:28
    
@vcsjones, a retailers self review probably counts as a study. You could probably work this into an answer. –  James Jenkins Dec 27 '13 at 17:57
    
@vcsjones I don't see how the lack of DRM would ever hurt sales. Who says "I won't buy your / read your book until you add DRM to it." I think the question is "Does having DRM hurt sales, and by how much?" or "Does not having DRM help sales, and by how much?" Specifically if there are studies answering this question. –  John Dec 28 '13 at 13:46
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@John: The typical argument is that no DRM makes pirating (and general unlicensed sharing) easier, leading to more copies shared for free and fewer copies sold. In extreme cases, this logic has been employed (spuriously) to count individual illegal downloads as "lost sales," which could have been preserved with strong enough DRM. For less extreme arguments, a study would be helpful :) –  Standback Dec 29 '13 at 6:49
    
@vcsjones Ahhh, I see. So, no DRM -> more piracy -> lower sales. I get it now. Thanks. –  John Dec 29 '13 at 6:59
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3 Answers

There was a study1 done by Laurina Zhang about the effects of DRM on music sales. In her conclusion1 she states:

My analysis in this paper, based on a large representative sample of albums from all four major record companies, sheds light on this question. I find that the removal of DRM increases digital sales by 10%.

While this does not directly address the eBook industry, it does suggest that DRM may also have a negative impact on sales of Ebooks.

1Warning: Links directly to pdf.

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As the author of 5 tech books (all available in ebook format and published by O'Reilly Media), I can tell you that the O'Reilly party line is essentially that "DRM logic is flawed". We're in a transition period right now and you have to have "faith in the base logic market" and take into account how "DRM interferes with the user experience".

My personal views on the matter as a producer of published goods and as someone who is trying to treat my latest effort as a "book-as-a-startup" (product vs project) are basically in line with those of O'Reilly in that you don't lose anything with digital goods sales unless more people who could have paid for your content don't pay for it because they elected to stick with the pirated versions. e.g. "People who don't pay you generally wouldn't have paid you anyway."

In some regards, you could actually look at it as a sign of viability and even a compliment if you were a highly pirated ebook author. Clearly, you've done something right to have become that "in demand".

Anecdotally, and along related lines, I've had many people tell me that they often will "preview" content by searching for a PDF and then following up with a purchase. In that regard, pirated versions may ironically lead to "conversions in sales" for the people who would have paid you anyway.

Along related lines, many ebooks these days are inexpensive enough that it's just not worth the trouble to risk having an out of date pirated version when publishers like O'Reilly now offer premium services such as giving you automatic updates to Dropbox or Google Drive. In that regard, people who "would have paid you" probably will pay you for that premium of having the latest/greatest errata-free versions (at least for tech books.)

A closing thought: I suspect that there is a strong correlation between how pirated your content is and how many copies that you actually sell. (The sum of the two could be considered your "overall demand".)

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I am a bibliophil. I can easily spend a couple hundred dollars in a book store, and have done so many times. I often buy books online that I can not find locally, again hundreds of dollars. I also have e-reader and have lots of e-books. Not one has drm. If it has drm I won't buy it. Kris longknife, great books, but I couldn't find them without drm, so I bought paperbacks. Same thing over and over again great books with drm get bought as paperbacks, If I can find them. I spent years searching used bookstores for Dave Duncan's The Reluctant Swordsman and you would not believe how happy I was when I found out Baen was reissuing it (I bought the ebook and both sequels, even if I liked the original cover art better). There also have been times where I would hear about a story that looked interesting, but only was published as kindle only, that the only thing I remember was wasting a day or two looking for another vendor. I can't remember the title or author, because I didn't feel it was wort wasting 75 cents for a book I couldn't read. Was it one of yours? If so you lost a sale.

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I know this isn't Skeptics.SE, but anecdotal evidence from one person isn't really a good answer to a question asking for studies. Sorry but -1. –  DVK Dec 28 '13 at 20:47
    
I'm sorry, but I found a study that had some great reviews and I was going to read it to see if it was any good, but It was kindle only, so I didn't. –  hildred Dec 28 '13 at 20:50
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you can read Kindle books on PC as well –  DVK Dec 28 '13 at 22:48
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