Has DRM had its day?

Apple boss Steve Jobs has surprised pretty much everyone by making a statement about technological protection measures in the music industry, in a move reminiscent of Bill Gates’ comment about how DRM had become too complex for consumers. In an open letter to the public, Jobs has stated that:

“Why would the big four music companies agree to let Apple and others distribute their music without using DRM systems to protect it? The simplest answer is because DRMs haven’t worked, and may never work, to halt music piracy. Though the big four music companies require that all their music sold online be protected with DRMs, these same music companies continue to sell billions of CDs a year which contain completely unprotected music. That’s right! No DRM system was ever developed for the CD, so all the music distributed on CDs can be easily uploaded to the Internet, then (illegally) downloaded and played on any computer or player.

In 2006, under 2 billion DRM-protected songs were sold worldwide by online stores, while over 20 billion songs were sold completely DRM-free and unprotected on CDs by the music companies themselves. The music companies sell the vast majority of their music DRM-free, and show no signs of changing this behavior, since the overwhelming majority of their revenues depend on selling CDs which must play in CD players that support no DRM system.

So if the music companies are selling over 90 percent of their music DRM-free, what benefits do they get from selling the remaining small percentage of their music encumbered with a DRM system? There appear to be none. If anything, the technical expertise and overhead required to create, operate and update a DRM system has limited the number of participants selling DRM protected music. If such requirements were removed, the music industry might experience an influx of new companies willing to invest in innovative new stores and players. This can only be seen as a positive by the music companies.”

This is remarkably sensible, and at least it has opened the debate against DRMs. It is heartening that such a powerful voice as Jobs has seen the light. To be fair, he is probably just worried about slumping sales in iTunes, and he wants to make sure that Apple will end-up with the largest piece of the digital downloads cake. With so many companies placing themselves as competitors, and with Microsoft Vista and Zune placing themselves as a viable competitor, Jobs and Apple want a cut of the sales. iTunes has brand recognition, and if their music can play anywhere, then they would probably see their sales increase.

The music industry has not responded well to the suggestion of course. Warner Music’s boss Edgar Bronfman has already pronounced that Jobs’ ideas are “without logic and merit”. Strong words from one of the biggest names in the music industry.

I’m going to sound extremely optimistic here, but I think that at least we’re having a debate about DRM, and the story has made the headlines.

Comments 1

  1. The problem with the record industry is that it is run by people who are, I strongly suspect, not big users of music download services. As more people come through who are intimately familiar with using the technology in their daily lives, I think we'll see a change in attitude. For example, I gather there have been rumblings of a softening of position at Universal.There does seem to be a certain momentum building now towards DRM-free music. I think this is largely because no physical medium is going to replace the CD, so there is no opportunity to lock down the physical side.Of course, if CDs were overwhelmingly replaced by downloads, to the extent that a lot of content became download-only, then DRM might be easier to apply. But – oh, the irony – consumers aren't that daft, and the only way to make downloads that popular is to scrap the DRM in the first place. A more positive approach would be to sell MP3s with added value – integrated lyrics and album art etc – so that there is a clear gain for consumers in buying the MP3 as opposed to buying a CD and ripping it.For movies, the content-owners will no doubt be hoping for a different outcome, with restrictions built into the hardware more effectively (HDCP, the DRM systems on HD-DVD and Blu-ray). Well, let's wait and see, shall we?

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