May 2, 2007

"Digg buried by users in piracy face-down."

Interesting. Both the power of a website's community over its owners and the issue that moved them to wield their power.
Pleading for the Digg hive mind to practice self-moderation, CEO Jay Adelson responded on the company blog at 1PM Pacific Time: "We all need to work together to protect Digg from exposure to lawsuits that could very quickly shut us down."

Diggers continued their revolt, however, overloading the site with the thousands of places where the [HD-DVD] encryption code can easily be found online, until servers started spouting 404 errors and moderators finally gave up trying to control the rabble about eight hours after Adelson's plea.
TechCrunch writes: "Digg surrenders to mob."

What's the difference between a "hive mind" and a "mob"? Is it all a matter of whether it thinks what is good? But those who would like to preserve intellectual property rights have to worry that that mind -- hive or mob -- is generating the new idea of the good.


Annie said...

That's one of those headlines that makes you see a vivid and inappropriate image. I saw pirates with shovels burying someone face down on a beach.

Annie said...

More to the point -- when these young male programmers grow up and invent something unique and powerful, are they still going to be happy to give it away? A sort of open-source communism is all very well when you're young and on the taking end, and don't have a family to support, and are still consuming more experiences than goods . . .

Fen said...

This is nothing new - the digg "mob" routinely buries LittleGreenFootball articles re Islamic terror, classifying it as "hate speech" and demanding it be pulled. One of the drawbacks to "direct democracy" type sites.

I had the privilege of being banned from a website for linking to LGF. I was deemed a "racist hate-mongerer". My sin? Linking to a report of college conservatives being physically attacked by Leftists. The digital brownshirts of the left in action:

So now Digg has fallen prey to its own mob? Oh. No.

bill said...

In Kevin Kelly's Out of Control, Chapter 2 is Hive Mind. It's all online and here's the jump to subsection: The collective intelligence of a mob.

The marvel of "hive mind" is that no one is in control, and yet an invisible hand governs, a hand that emerges from very dumb members. The marvel is that more is different. To generate a colony organism from a bug organism requires only that the bugs be multiplied so that there are many, many more of them, and that they communicate with each other. At some stage the level of complexity reaches a point where new categories like "colony" can emerge from simple categories of "bug." Colony is inherent in bugness, implies this marvel. Thus, there is nothing to be found in a beehive that is not submerged in a bee. And yet you can search a bee forever with cyclotron and fluoroscope, and you will never find the hive.

This is a universal law of vivisystems: higher-level complexities cannot be inferred by lower-level existences. Nothing -- no computer or mind, no means of mathematics, physics, or philosophy -- can unravel the emergent pattern dissolved in the parts without actually playing it out. Only playing out a hive will tell you if a colony is immixed in a bee. The theorists put it this way: running a system is the quickest, shortest, and only sure method to discern emergent structures latent in it. There are no shortcuts to actually "expressing" a convoluted, nonlinear equation to discover what it does. Too much of its behavior is packed away.

That leads us to wonder what else is packed into the bee that we haven't seen yet? Or what else is packed into the hive that has not yet appeared because there haven't been enough honeybee hives in a row all at once? And for that matter, what is contained in a human that will not emerge until we are all interconnected by wires and politics? The most unexpected things will brew in this bionic hivelike supermind.

Balfegor said...

when these young male programmers grow up and invent something unique and powerful, are they still going to be happy to give it away?

I suspect it depends what we're talking about. Many of the great open source products -- the various incarnations of Linux, Open Office, the GIMP, Blender, Audacity, etc. -- seem to be produced not only by teenagers and young men, but also people somewhat older and more experienced (i.e. in their 30s, even 40s). The demographics certainly skew young, but not exclusively so.

In any event, I suspect a large number of programmers on open source projects are, in fact, professional programmers as well, and do the open source stuff as a hobby. Open source (at least in my experience) tends to provide pretty widely useable projects, because the projects that large numbers of people will use (e.g. word processors, operating systems, general-use graphics applications) are also the projects that large numbers of potential coders will want to use, so the pool of open-source contributors is large.

On the other hand, there's lots of highly specialised programming work that needs doing. Companies may want a document or database management system tailored to their organisation. Hospitals, law firms, banks, government agencies -- these all require specialised programs to manage their affairs. In other cases, companies or organisations may want added security from a system or program that is not generally interoperable with general-use programs and so on (sort of like the Macintosh security-through-obscurity taken to an extreme). In all these cases, they hire programmers to provide that kind of "bespoke" programming (as it were). And I don't see any reason that revenue stream won't continue in the future -- those specialised programming needs don't seem to me to be particularly likely to be met by open-source projects.

More on topic, I thought the Digg revolt (which, incidentally, is not limited to Digg by any means -- the code is appearing in posts and comment threads everywhere) was kind of amusing. A lot of people seem to have grown up on that cyberpunk lit, and here, at last, is their chance to live the fantasy! If only in a small way.

Paul Snively said...

I'll cop to being male and a programmer, but "young" would be quite a stretch, being a homeowner on his second marriage, with an 18-year-old stepson, and all that. So I'm doing all right on the family support and consuming of goods fronts.

We male* programmers have actually given the issue of the economics of bits--and let's be clear that that's what we're talking about--quite a lot of thought and, as you've noticed, we've even conducted a number of experiments "in the wild," as it were.

To briefly summarize, there are some important, non-trivial from a moral/philosophical/legal perspective, questions about what, exactly, is being sold when we talk about audio CDs, audio/video DVDs, software (distributed on CDs and/or DVDs), and probably other forms of bits-on-physical-substrates. The central observation is that it used to be prohibitively expensive to copy those bits anywhere else. We male programmers, in collaboration with our male hardware geek friends, solved that problem. Actually, we weren't thinking about music and video at the time. We were thinking about all the data we had to deal with, and CDs and DVDs make good repositories of large quantities of bits--that's what they were designed for, after all. So copying CDs became feasible and people started doing so.

What a lot of people didn't know until then, however, was that what you're buying, according to the legalese that you probably didn't even have the opportunity to read before opening the jewel case, is the right to that performance on that media. Nothing more. So this immediately opened a can of copyright/fair use/etc. issues legally, and bumped headlong into two important American social forces: first, Americans in general don't care much for unenforceable laws, and there are very few laws in the world as unenforceable as "thou shalt not copy these bits that are trivial to copy." As Bruce Schneier will tell you, any copy protection scheme that includes the decryption key on the playback device itself is trivial to hack by definition, which, not coincidentally, is why the DMCA has specific language about "devices" intended for such subversion being illegal. The problem with that is the law of unintended consequences: such "devices" could be construed, legally, to include the software debuggers that each and every programmer uses to do his job. There's also the question of what the "expression" of an "executable" decryption tool is, legally, which prompted a highly-regarded male professor of computer science, David Touretzky, to create the DeCSS Gallery in order to highlight some of the issues.

Second, male programmers tend to have an unusually competent grasp of how economics actually works, vs. how it's taught in most universities. The bottom line insight is that analogies of bits-on-physical-substrates to material goods break down essentially immediately precisely because the classical rules of scarcity governing "supply and demand" don't apply: the marginal cost of making copies is so low as to be negligible. Arguments of "lost sales" due to piracy rest on the assumption--and it's a big one--that the person taking illegal copies would have bought the product at the fixed price had the illegal copy not been available. This ignores the awful history of the entertainment industry with respect to issues of the market setting the price of the product, as well as viral marketing benefits of greater artist exposure than is possible by the traditional, centralized, payola-based promotion system.

Since software is just bits-on-a-physical-substrate too, we male programmers have been very deliberately exploring the ramifications of all of the above observations on our own industry as well. Many of us have observed that there is no inherent contradiction between giving some product away and selling some product, or giving all product away and selling support on a rotating or as-needed basis. We try to do relatively sophisticated analyses as to which kinds of products are already commodities and which aren't, and how they can be combined in novel ways so as to add value. Right now, as you're reading this, you're probably taking advantage of a significant stack of open-source software that anyone can download anytime they want: the Linux operating system, the Apache web server, the Python programming language, etc. If you're using Mac OS X, you can download about half of your operating system. If you're using the Safari web browser, you can download the source code for everything but the stuff outside the actual content frame. If you're using Firefox, you can download all of that source code, too. But the male programmers developing these things aren't going broke, as a look at real-estate prices in Silicon Valley quickly reveals.

So don't worry. We'll all survive the early phases of this inevitable decoupling of the bits from their physical substrate--in fact, some folks for whom the barriers to entry into the traditional music/movie business were too high can now make a reasonable living at it.

Some of them will even get rich.

*I'm being ironic, of course. Some of the best programmers I've worked with have been women.

kettle said...

These 'property rights' are still the subject of vigorous debate. I think it's rather myopic to look at this issue through a pre-digital lense and assume that all the young people out there are going to be satisfied with the current notions about these rights.

"More to the point -- when these young male programmers grow up and invent something unique and powerful, are they still going to be happy to give it away?"

I'm sure exactly what you are trying to say, but I recommend reading a bit more about what open source is:

To programmers and developers and researchers this is very much a two way street.

sonicfrog said...

What Paul said.

Is this an example of being hoisted by your own petard?

Before Digg, there was Slashdot. It was the online source of tech news for the masses. Digg was created as a response to reader dissatisfaction that Slashdot operated like a standard news business, having editors and management chose which stories would or would not be posted for public consumption. They had gatekeepers. Digg was going to be better because the end user could post what ever they liked, as long as it was relevant to news or entertainment, and wasn't poronographic. It worked for me, for a while. I stopped visiting Slashdot since the same stories were also on Digg, and Digg did have a wider variety of tech stories than Slashdot. My allegiance to Digg started to waver as the 2004 campaigns started kicking into high gear, and Digg became more of a left-wing sounding board than a tech news site, a trend that continues today. If I want left leaning content, I'll visit HuffPo or KOS. So now I visit both tech news sites. Digg still has more content, but Slashdot is more focused on tech related stuff, so it's easier to find stuff without wading through the political fluff.

Signed: Sonicfrog, Linux user since 2000.

PS. I am on my Linux computer even as I type.

Zeb Quinn said...

This turf was officially plowed 10 years ago with Eric Raymond's The Cathedral and the Bazaar. It and its progeny is still good reading. Old school lawyer that I am, with old school notions of property rights, I initially resisted it, but the seeming indomitable spirit of the neo-anarchists dominating the internet caused me to wonder. Then the empire struck back in numerous cases, and right now my bets tend to be with the cathedral. In the long run the internet will be reined in and controlled.

PC said...

Digg created a "perfect storm" of discontent when they began deleting stories and comments without explanation. Geek types have plenty of discontent for copy-protection mechanisms as it is, but when a website that posits itself as a marketplace of ideas begins removing the "market" from that metaphor, chaos was all but certain to ensue. I'm almost curious as to whether Digg wanted some of this to happen... it took them quite a while to take any action to stem the tide.

I also wonder what would happen in such a user revolt against Autoadmit / Xoxohth. That place is revolting enough as it is, and has recently generated a bomb threat and subsequent evacuation of UC Hastings.

PC said...

Oh, and I've got another vote for Linux and open-source in general. I've been using a variety of distributions for a few years now, but really like Ubuntu now.

Paul Zrimsek said...

Story buried by editor in syntax fucked-up.

sonicfrog said...

PC, have you tried Mint Linux? It's Ubuntu but with most of the media codecs already pre-installed. I'm using it right now.

Methadras said...

When things like this come up, I'm not quite sure where I stand. I suppose I have to take it on a case by case basis. I did see the HD-DVD decryption key posted in hex on digg, I've also seen it elsewhere, but I also understand diggs stance of not wanting to incur any liabilities via copyright holders.

What I do find astounding, is that the users have bullied Digg into running off the cliff with them. Not only might this signify the end of Digg, but also the users ability to use Digg ever again. But they don't care because even if Digg goes down, they will just digitally disperse themselves for another mobfest later on.

I hope Digg comes to their senses and rejects the mob mentality in this case.

AntonK said...

Mob? Hive? Lord of the Flies is more like it.

johnstodder said...

Doesn't it seem strange to anyone that a brief series of letters and numbers are all that separates copyrighted content from its theft and piracy?

After working on this issue (on the copyright owners' side, with which I was initially sympathetic), it finally occured to me that these decryption codes are merely traps designed to create a pretext for bullying and deterring legal action. The DMCA is designed to help copyright owners litigate rather than innovate. True copy protection is hard. They'd rather create a flimsy mode of protection, and then bring the full force of the law down on anyone who breaches it.

It's like a virtual fence. Why bother developing a truly workable encryption system (or develop a legitimate way to balance copyright owners' rights with content consumers') when you have U.S. Marshals at your disposal?

Paul Snively said...

You folks complaining about the "mob mentality" are missing the point. It's physically impossible to prevent the discovery of these kinds of circumventions of "copy protection." The scare quotes are because the only people affected by the "protection" are the legitimate customers who are inconvenienced by it. To the extent that the "protection" primarily protects the profits of cartels who a) break the law themselves by price-fixing, payola, etc. and b) have built a business model based on a scarcity of bits that doesn't exist, people who actually understand the law, the economics, and the technology will ensure that a) the circumventions exist, and b) they are sufficiently widely distributed as to be impossible to eliminate, including, crucially, by crossing jurisdictional boundaries. The internet is the largest Temporary Autonomous Zone in the world.

It's absolutely correct to observe that Digg is in the middle of this, and if they are not legally protected from the consequences of their providing the opportunity for people to disseminate this information, then they may suffer those consequences, and that's of no import to those who observe that such an event serves as an exemplar of the flaws in the law--the most important of which is that the law is impossible to enforce universally, so indeed if Digg goes away they'll find another venue--and that is one reason among several as to why the law shouldn't exist.

Daryl said...

What's the difference between a "hive mind" and a "mob"?

A hive mind is a single, powerful intelligence at the center of some network, with subservient, lesser intelligences around it that supply it with information and do its bidding.

Digg is not a hive mind. As much as I would like to see a hive mind emerge from the internet, it just isn't happening, and I don't see any reason to believe it will ever happen. Humans do not make good drones for a central intelligence. We are too independent and we can't share our own information/knowledge quickly or completely enough.

Digg is just a mob. It may be interesting in its own way, but it's not a hive mind.

Strong AI will see the rise of hive minds. Individual AIs will be able to pool their resources to tackle truly huge problems. But that's probably 20 years out, optimistically.


As far as selling open source software, plenty of companies have made this work. They give it away for free, on the condition that if you incorporate it into a bigger program, you must give away that entire bigger program for free.

Software vendors who want to use the open source software but want to keep their products closed-source buy a license from the open source company. Further, the open source company can sell tech support.

As long as there are closed source vendors who want to keep their code a secret, open source developers can profit. They get a lot out of the bargain: by releasing their code for free, a lot of people will will check it for bugs and security weaknesses. If its use becomes widespread, and it's shown to be effective, efficient software, commercial vendors are more likely to want to include it in their own products.

There is a real place in our tech economy for commercial open source software development.


What I want to know is, how can a number become a national secret?

People are going to start wearing this number on T-shirts.

Our information society is very bad at keeping secrets once they get out, but on balance that's a good thing.

Journalists will use this as an example of out-of-control, undisciplined internet users, but they're the ones who betrayed our national security time and again, and chose to run Cho's video to get ratings. In contrast, a Hollywood encryption key is pretty tame.

sonicfrog said...
This comment has been removed by the author.
sonicfrog said...

I dunno. Mr Rose, Albrecht and company have lawyers who I'm sure were consulted before they decided to take this tac(sp). They may feel this will lead to a lawsuit that will change the nature of the convoluted nature of the DRM attached to HD-DVD.

PS. I had posted a rant on the nature of HD-DVD, but I think I was wrong on the details, so I trashed the post.

An Edjamikated Redneck said...

A point I find intersting is that it is put forward that you are paying for the performance when you purchase, say, a CD.

If I own an 8-track tape of Billy Joel, can I then download any of those songs for free (in MP# format), as I have already purchased the performance?

I have the technology to take my 8-track and convert it to MP3, although it is time consuming, so I can use the same performance I have already paid for and listen to it on my ipod, but downloading it for free is more efficient.

If I do purchase the songs again am I really paying for the performance, or the media? How much of the price of the MP3 goes to Mr. Joel?

Sigivald said...

People use Digg? Intentionally?

Guh. Never seen the point, myself. Nothing but rank-gaming and utter crap is what I've ever seen on links to Digg stuff.

(And to the people talking about Open Source and Leenooks... that wasn't the point.

Annie's comment (if I read it correctly) wasn't about people choosing to make free stuff available; that's not Communism.

It's about people, much like Daryl, who extrapolate from something being able to be distributed (and "you can't stop it!"), to having a "right" to it, because they want it.

" each according to his needs", and screw property rights. That is "open source communism".

Linux-related crap isn't, since it's voluntarily released to the public by the authors.)

(Full disclosure: I'm a male, relatively young programmer. And I don't write open-source. Because I want to do it for a living, and open source doesn't pay very well. And because I'm not a worshipper at the Temple of Open Source.

[And no, any counterexamples will be laughed at unless they're extensible to very large numbers of people, and are doing so right now. That a few people get paid to do it by large companies making money from other things does not make it a generally valid way of earning a living.]

jaycurrie said...

Balfegor gets the tech issues right which is half the puzzle; the other half is the utter cluelessness of counsel when it comes to the net.

For most of us a string of hex is as mysterious as a hieroglyph and would remain that way even with DIGG publishing it hourly. However, once the takedown notices were sent a huge section of the web, fed up with DRM, the RIAA and MPAA, and the general attempts of the corporate world to impose outmoded business models on a new world, revolted.

Which competent counsel would have predicted had they paid attention to other attempts to block the flow of information on the net. Worse, counsel seemed to think that the DMCA applies extra-jurisdictionally. As the boys at Pirate Bay are keen to point doesn't.

So, even if they had managed to kill posting on DIGG and Slashdot, people with servers in other countries would have posted the magic number and, amazingly, Google would have found those sites and made them available to people trapped behind the DMCA wall.

DRM and assorted encryption strategies hide the utter failure of the entertainment biz to figure out a business model which works in a digital world. Until they do all the DRM in the world is only going to irritate their customer base and provide challenges for very smart geeks with time on their hands.

There are a lot of ways to make fully licensed digital products appealing. Dropping the price is one, great non-digital addons are another, special access to updated online material, deals on concert tickets or fabulous support, are still more.

If you look at CD sales as they drop off a cliff it is pretty clear that the RIAA strategy of suing you customers is less than ideal. A fact that apparently escaped learned counsel in this case.

Annie said...

Paul Snively,

"Male" was plucked from the Register article:

Much of Digg's audience, heavy on male college students and internet workers, saw the move as an act of censorship.

Annie said...

Actually (says the copy editor), that's ambiguous. (I just typed "ambuguous." I like that word!) It's not clear whether "male" applies to both groups or only to college students.

Annie said...

I just read Red Hat's "Why Open Source?" Bill Gates must hate this.

It says if the code is hidden and protected, no one will have to see how bad the software is. With that I beg to differ!

Paul Snively said...

Annie: no worries. I found the locution amusing, mostly because it's true; anyone who denies that the programming world is overwhelmingly male-dominated is delusional. pure and simple.

Having said that, there was a perhaps unintentional implication that "male programmers" are anti-capitalist idealists that doesn't seem particularly moored to reality that I also found amusing.

On the third hand, people who don't have the background to understand why events like this are not only predictable, but pragmatically speaking, inevitable, amuse me too!

Freeman Hunt said...

All posturing and legalism aside, if you take a person's work for free when he's only offering it in exchange for payment, you are stealing. No legal loophole, carping about evil corporations, or any other rationalization will make it not so.

Paul Snively said...

Of course taking someone else's work without paying for it is stealing. So's price-fixing and payola. There aren't that many innocent people involved in this story. The principal point I wanted to make in my first post was really the one about unenforceability. "Copy protection" and the DMCA are both technically ludicrous from an enforceability point of view, so their subversion is inevitable given the readily-available admixture of technical prowess, youthful idealism, rebelliousness, and time to be found in teenagers' living quarters throughout the world.

Paul Snively said...

I've neglected to note that serious people are taking the problem seriously, to such an extent that novel solutions are being proposed. One such potential solution is the Rational Street Performer Protocol. Quoting from the linked page:

"Some things it would be useful for are:

* Web comics
* A musician producing songs
* Software maintenance and documentation
* A serialized book, or an author producing a series of books"

sonicfrog said...

OK, I double checked my source and he confirmed my take on this subject is correct, more or less. Here is what I wrote:

As I understand it, the HD-DVD contains identification code for each brand / manufacturer that produces HD-DVD players. The code on the disk must match the code on the player, or the movie won't play. If the code to one brand is hacked, say Sony HD-DVD player, then the code on future HD-DVD's players manufactured by Sony is changed, and future HD-DVD's will be encoded with the new identification to matchl. The result, if you already own a Sony HD-DVD player, and it contains the now hacked ident-code, you, the consumer who had nothing to do with the fact that the code was hacked, are screwed, because new HD-DVD's will now contain a different identification code for Sony players and they won't play on your instantly outdated machine. So you will have to go out and buy a new machine every time one of the codes from your brand gets hacked. Great for the manufacturer of players and HD-DVD disks, stinky rotten for the consumer.

Lovely, isn't it?

There is an interesting twist to this Digg / HD-DVD affair. The idea was that each manufacturer had a specific code, and there would be no one code, or master code, that would unlock the HD disks. Yet it seems this hack would unlock all HD-DVD's, so it certainly looks as if this is a master code.

PS. I'm not sure if the old codes will remain on the new machines so you can still play your old disks on the new machines. You may have to go out and re-purchase disk you already have if you intend on staying with the same brand.

Christy said...

Strikes me as a "might makes right" mentality with which few of us, if we aren't the mighty, are comfortable.

Bill, I liked:
This is a universal law of vivisystems: higher-level complexities cannot be inferred by lower-level existences. Nothing -- no computer or mind, no means of mathematics, physics, or philosophy -- can unravel the emergent pattern dissolved in the parts without actually playing it out. Only playing out a hive will tell you if a colony is immixed in a bee. The theorists put it this way: running a system is the quickest, shortest, and only sure method to discern emergent structures latent in it. There are no shortcuts to actually "expressing" a convoluted, nonlinear equation to discover what it does. Too much of its behavior is packed away.
I think it exactly expresses why modeling global warming is not possible. I'm not saying GW isn't real, just that we have no way of knowing.

Paul Snively said...

It's not that might makes right; it's a question, IMHO, of the extent to which you want your laws to have only symbolic value, which to me smacks of substituting law for receiving your moral framework from your family/philosophy/church/synagogue/etc.

As for the mighty, read the license on any music CD or DVD, read the text of the DMCA, read the findings on price-fixing, payola, and other forms of collusion in the RIAA and MPAA, read Courtney Love's great rant on "sharecropping," and then we can talk about who the mighty are and are not in this situation.

Bruce Hayden said...


That seems a bit scary from Sony's point of view. If they somehow release something that won't work on the hardware owned by a lot of customers (because the code has been hacked), those customers are first going to be able to sue Sony for fraud (after all, they didn't disclose that their content wouldnt' work with this hardware before the purchase). Similarly, it will give them a big black eye (likely worse in their case than their DRM fiasco of a year and a half or so ago).

Bruce Hayden said...

This is a very interesting thread, if for no other reason than it hasn't elicited the partisanship and venom that we have seen on so many threads recently. Rather, we have here a long and involved thread with almost no rancor.

bill said...

Ed Felten has a good review:

Which brings us to the civil disobedience angle. It’s no secret that many in the tech community despise the DMCA’s anticircumvention provisions. If you’re going to defy a law to show your disagreement with it, you’ll look for a situation where (1) the application of the law is especially inappropriate, (2) your violation does no actual harm, and (3) many others are doing the same thing so the breadth of opposition to the law is evident. That’s what we see here.

Revenant said...

These people didn't steal and distribute a program, or a blueprint, or a recipe, or anything like that. They "stole" an integer. That's right -- a number. As in... "1".

At this point, many American citizens are scratching their heads, asking themselves "how the hell can somebody OWN a number?". Good question! The answer is "because they have a lot of money, and Congressmen like money". The idea of "owning" a number is as ridiculous as "owning" the idea of romantic love or the belief that trashy romance novels kind of suck.

The number isn't an invention. It is the precise equivalent to the combination of a safe. Except in this case the owners of the wrote the combination on (in, actually) a whole bunch of their products and then distributed them around the world. They then tried to protect their safe by making it illegal for anyone to figure out the combination or tell anyone else once they knew. This is also ridiculous -- it is thoughtcrime.

It is one thing to criminalize piracy. That's something I and most other engineers and creative individuals think SHOULD be illegal. But criminalizing the knowledge of HOW to copy things without permission is utter bullshit.

sonicfrog said...

Bruce said:

That seems a bit scary from Sony's point of view. If they somehow release something that won't work on the hardware owned by a lot of customers (because the code has been hacked), those customers are first going to be able to sue Sony for fraud (after all, they didn't disclose that their content wouldnt' work with this hardware before the purchase). Similarly, it will give them a big black eye (likely worse in their case than their DRM fiasco of a year and a half or so ago).

I used Sony only as an example. I could have said Panasonic or Toshiba, but they have more letters and I hate typing. Anyway All devices that are capable of playing HD disks, either HD-DVD or Blue Ray, are required to have AACS decoders in order to play. This is not the choice of the machine manufacturers, it's the Hollywood studios in cooperation with Microsoft that demanded the content be "protected" in this fashion. It's all pointless now though, as it does seem yet another crack may indeed bypass the whole AACS security process entirely.