Do you here that? It's the sound of a fundamental shift in the industry.
Though it is described as "not formally part of" the international Penguin Random House publishing conglomerate, Random House Germany is still a close cousin. It's also the largest publisher in Germany, and now it is following in the footsteps of its next two largest competitors, Holtzbrinck and Bonnier, both of which opted for a lighter form of DRM earlier this year.
They have not yet gone DRM-free, but this is still great news for ebook readers everywhere.
As I have reported in the past (including as recently as last Friday), a digital watermark is one of the lighter forms of DRM. It consists of a tiny bit of unique code that is added to a copy of a file when it is (ideally) sold to a customer. The code doesn't impact the reading experience, and it can be used to identify the customer who bought the file should that file turn up on a pirate service.
This is not DRM-free, but it is the next best thing. But I would not set off fireworks just yet, because the publishers could still be using hard DRM in certain ebookstores.
There's disagreement in technical circles as to whether digital watermarks count as DRM, but for the time being we're going to have to count it that way - and not just because publishers think that way.
While the publishers are using a softer form of DRM, they still see digital watermarks as DRM (Random House Germany was clear on this point in their announcement). That means when they don't have the option of digital watermarks, they could opt for hard DRM.
For example, the Kindle Store only offers two DRM options in KDP: no DRM and hard DRM. This forces a publisher to either use Kindle DRM or no DRM, and we cannot assume that the publishers will opt for DRM-free.
Pottermore, for example, uses digital watermarks on the ebooks it sells, but it also applies Kindle DRM to any Harry Potter ebook you send to your Kindle account.
Similarly, a spokesperson for the Bonnier imprint Ullstein Buchverlage confirmed that its ebooks use Kindle DRM.
Edit: In the comment section, a reader confirmed that this mixed-DRM situation was common in France:
That’s what happens here in France, where many small publishers choose watermarks, many small to medium e-booksellers do watermarks, and only Amazon, Kobo, Apple and Google do encryption-based DRM.
I am still waiting to hear back from Random House Germany, but I would not assume that any publisher has completely switched to soft DRM without explicit confirmation.