DRM certainly serves a purpose, which (as articulated in the source article) is to provide publishers with leverage over distributors. Distributors provide by far the largest chunk of revenue to publishers, and the fact that many of them are in other legal jurisdictions from the publisher gives them considerable leverage. Absent DRM, distributors can promise a lot to publishers but will suffer little loss if they breach the contract. DRM provides publishers with a way to track distribution and to lock out dishonest distributors in a way that will withstand legal scrutiny.

You keep looking at it as consumers v producers in a zero sum game. This is a wholly inaccurate model. distribution is a business fundamental for reasons that I've explained above. In fact, it's a legal fundamental as well, because thanks to antitrust laws in the US film studios are prohibited from owning distribution channels like chains of cinemas

That's a bad example. WB didn't allow it to come out DRM-free despite it being crowdfunded. It should be a lesson not to trust these backwards thinking publishers ever.

It's a great example of the reality of film industry economics, even though it doesn't support your point. So what if they didn't let it come out DRM-free? Are you saying it would have been a runaway hit otherwise? No chance. At that, they gave refunds to annoyed customers who had problems with the Flixster purchase. If you think that the mediocre sales are the result of DRM you're looking at it from inside a bubble.

First, backers of the movie were entitled to a digital download as part of the Kickstarter reward. they didn't like Flixter, so WB issued refunds to people who had filed a support ticket, allowing them to download it via more popular outlets like iTunes or Amazon. This had zero effect on buyers who downloaded through those two main platforms. It may have deterred some potential online purchasers, but not many, I don't think.

As a rule of thumb, about 30-35% of respondents in surveys cite DRM policy as a major influence on buying decisions, in fields from e-books to videogames. As a second rule of thumb, home viewing revenue is about 50% of theatrical box office. (I'd have to write a few thousand words to fully describe sales channels and common deal structures in the industry. studios are very tight-lipped about the terms of individual deals, because that's very valuable commercial information, but we can also rely on the aggregate sums shown on tax returns and compare them with known box-office revenue, historical models, and so on. I'll skip the in-depth explanation and a raft of citations if you're OK with that; I have no reason to mislead you about this). So we can figure that potential lost sales from WB's DRM policy - which they are likely contractually obliged to stick to anyway - is about 1/6th of box office. Let's be generous and say it's 20% due to the extra publicity. It would actually be a lot less since core fans who were Kickstarter backers got digital copies and would not have had any incentive to purchase them separately absent DRM, but let's leave that aside.

Now, VM had production (including marketing) costs of ~$5.7 million. Box office revenue after 6 weeks in about 300 theaters is $3.3m, plus a few hundred thousand $ for worldwide (unsurprisingly low, given the limited international audience for the TV show). That's pretty bad from the studio's point of view. The studio (qua publisher) gets ~50% of the box office, so to break even the film needed to make $12m. Of course, the upside is that Kickstarter backers wanted a Veronica Mars movie more than they wanted financial profit, so Warner Brothers hasn't actually lost any money, but that's beside the point here. If we take our guess above that 20% of potential home viewer revenue was lost due to anti-DRM sentiment, that's about $700,000 at the very most.
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Those will be forced by hard competition only. I.e. imagine a big publisher coming which doesn't want to be a part of their cartel and makes DRM-free releases. Many would prefer that, and it can force other publishers to drop their crooked reasons when they'll start losing profit.

Jeepers, biased much? Look, that's not going to make any difference because audiences don't go out saying things like 'let's go watch a Paramount film tonight' or '20th century Fox is my preferred studio.' Marvel, Disney and Pixar are unusual because they have such strong brands, but they operate within pretty narrow market/genre parameters. Film products are not easily substitutable, so your basic supply-and-demand model isn't applicable here because we're not talking about commodities.

Here's an alternative scenario: a big studio decides to do DRM-free releases, and its domestic and overseas distribution network cuts presale revenue offers by half. The upside potential is maybe 11-12%. The downside potential is not being able to take large projects into production because you either can't raise sufficient funding or you can't get a financial institution to provide bridge financing or issue a completion bond (which is essentially production insurance).

I'm sorry, but you seem to view studios like cartoon villains twirling their mustachios as they sit on top of piles of ill-gotten loot. The reality of film financing is that it involves large numbers of stakeholders in a very high-risk market requiring extremely conservative contractual arrangements. From the distributor's point of view, they have little incentive to pay large sums of money to a studio or production company that won't guarantee them exclusive rights within a particular territory. After all, the distributor isn't likely to capture any of the extra revenue from DRM-free digital copies.