Could this be the beginning of the end for DRM?

My friend Alex thinks that DRM is a good thing (he believes that it’s the only way that content producers can protect their investments). I disagree with Alex on this and agree with Robert Nyman’s argument as to why using DRM to protect content is fundamentally flawed. Consequently I was very pleased to hear that EMI’s digital catalogue will be available at Apple’s iTunes Store from next month, DRM-free and at a higher bitrate.

EMI is not the largest of the music publishers but it is one of the big four. Whilst it’s easy to see the attraction of this deal for Apple (who have been facing some legal challenges in Europe over interoperability between iTunes and other vendor’s media players), it remains to be seen what it means for EMI (apart from a 25%-30% increase in digital revenues for each DRM-free track sold via iTunes). It could actually increase legal digital music downloads and I’m sure Sony BMG, Universal and Warner will be watching to see what the effect is before they make a similar move; it’s also worth noting that 13,000 independent labels already sell DRM-free content via eMusic (albeit at at lower bitrate and using the MP3 file format).

The EMI deal will also allow iTunes users to pay £0.20/€0.30/$0.30 to upgrade the music that they have already purchased – it may be money for old rope from the point of view of Apple and EMI but it’s also attractively priced (and it allows the record labels to increase the price of music sold via iTunes – something which they have wanted to do for while now). Digital music sales may only represent a 10% share of the worldwide market for music but are expected to grow to reach 25% of earnings by 2010 (although the recording industry is still fantasising about matching digital revenues to the decline in CD sales – a market phenomenon brought about by music collectors replacing portions of their vinyl collections with “digitally remastered” CDs and unlikely to be repeated for todays new media formats).

Personally, I’m pleased about this deal for another reason. Until now, there has been little incentive for me to buy albums online (even with the recent addition of the complete my album feature). I buy single tracks online (I stopped buying CD singles a few years ago) but have become increasing frustrated as certain tracks are only available if I buy the whole album (note to greedy record companies – this strategy actually drives people to seek out illegal downloads – if I was so inclined then I could download the tracks that I want from The Devil Wears Prada soundtrack via BitTorrent as they are not available to me on iTunes unless I buy the whole album).

At present, if I buy a CD (from the supermarket, play.com or elsewhere) then I have the DRM-free media and can rip it for playback on my iPod – alternatively I could pay Apple for inferior-quality DRM-protected content but from next month, I can buy 256kbps AAC-encoded albums, without DRM, for about the same price as a CD (and for the same price as the existing 128mbps AAC files with DRM) and, because the whole iTunes experience is so simple, I probably will. This is what Apple and EMI are banking on; however it will also make me more aware of which label I am purchasing tracks from (at the moment I neither know, nor care).

Incidentally, I recently heard that teenagers and young adults are the section of society most likely to copy CDs and use peer-to-peer networks to share files. That’s nothing new. The technology may have changed but I started recording chart shows to listen to music when I was about 12. If I hunt around in the loft, garage, or somewhere similar, I’ll probably find a box of cassette tape copies of friends’ albums from when I was a teenager and my time at Uni’. Only once I started to work for a living could I finally afford to buy CDs (and I bought a lot of CDs over the following 10 years or so, right up until just before I got married, at which time my money started to be spent on “sensible” things, like a huge mortgage…). So what’s changed? Nothing really, illegal file sharing is just the modern equivalent of the high speed dubbing that we did on our twin cassette decks 20 years ago – the only difference is that today’s technology allows a perfect digital copy and most of us have stood next to too many speaker stacks at gigs to notice the difference in quality anyway!

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