DRM is dead, long live DRM
- 20 May 08, 12:43 GMT
I've just had a fascinating conversation with , an analyst with Jupiter, on the subject of and music.
His view, and one that might trouble some, is that DRM on music isn't going away anytime soon.
Now that might seem odd, given that has just announced a major online service offering six million MP3 (ie DRM free) tracks, and that already offers something similar.
But Mulligan believes that the appeal of services offering the sale of music on a per track, or per album, basis will always remain niche.
The "lost generation" of music listeners who have become accustomed to getting music for free - either through illegal downloads, or social services like or Pandora - are never likely to be seduced by stores like iTunes or Napster's MP3 service, he feels.
So new models of consumption are emerging - among them pseudo-subscription services in which you buy the right to listen to as much music as you want at the point of purchase of a particular device.
This is the business model for , which is due to be launched later this year.
It offers as much music as you want, but access is limited to a particular Nokia device and a limited number of computers.
Services which give all you can eat options on a monthly or annual subscription basis will also continue, says Mulligan.
He says the music industry has realised that the old model, which saw a single new format replacing an incumbent format, is giving way to the emergence of many contemporaneous formats for many different types of consumers.
And in order for these services to work, DRM is still needed - either to tie you to a particular subscription or a particular device.
In other words, the world of DRM is about to get more complicated than ever.
And the risk, says Mulligan, is that music services could become Balkanized around specific devices in the future.
For example: If I invest in a Nokia phone that brings with it an unlimited supply of music, what happens when I decide to buy a Sony Ericsson phone in a few years' time?
Will I be able to transfer my music? Possibly not.
At the moment, say Mulligan, such concerns are not on the radars of consumers.
In the short term, it looks likely that the DRM-free model will be the most expensive. If you want complete freedom of choice, then you'll pay for it on a per track, or per album basis.
The radical position and one that no record company is discussing right now, says Mulligan, is an all you can eat model that is also DRM-free.
And what about iTunes?
Mulligan says iTunes is in danger of looking somewhat old hat, with its one size fits all download model.
It's not threatened by competitors at the moment in a real sense, but there are threats on the horizon.
Mulligan predicts iTunes will offer an all you can eat model in the future - but one tied to its iPods, and at a price that is added into the device at the point of purchase.
So... would you like your iPod for $300 with no music, or $400 with as much music as you want, on the assumption you can never move it to a rival MP3 player.
And DRM? Don't plan the funeral just yet.
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Comment number 1.
At 20th May 2008, maethorechannen wrote:Aren't iTunes tracks (except the DRM free ones) already closely tied to iPods?
The recording industry isn't going DRM free because consumers want DRM free music, they're going DRM free to try and get themselves out of the iTunes lockin that they put themselves in.
If they did go down the "all the DRM music you can eat with Nokia" road then they'd still be in much the same boat as now, only it'd be Nokia calling the shots. Binding themselves to single platform makes about as much as sense as them binding themselves to a single brand of CD players 25 years ago would have.
DRM isn't only bad for consumers, it's bad for the industry (it's just a shame that thier own fear blinds them to this)
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Comment number 2.
At 20th May 2008, U9746596 wrote:This is pretty short sighted and assumes that peoples problems with paying for money is the price. While that may be true with many consumers, there is a huge number of people who just wants to have a music collection that universally works on every device.
The idea of people getting a full collection per device, might appear to some people, but anyone with half a brain will realise that it will become a real pain down the line.
I really can't see this taking off.
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Comment number 3.
At 20th May 2008, U9746596 wrote:Just reread the post and saw all spelling and grammar mistakes...sorry
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Comment number 4.
At 20th May 2008, James wrote:I legally downloaded a DRM-free album last week and paid 拢7.55 for the privilege of doing so. However, in my haste I hadn't realised that for a mere 44p more I could have bought the CD from the same website. And herein lies the problem. DRM-free downloads are simply too expensive.. Given that production and distribution costs of an MP3 are negligible compared to those of physical media, I can't help but feel somewhat ripped off. If the price of an album was 拢5 or under then I would be buying a lot more music this way.
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Comment number 5.
At 20th May 2008, Electric Dragon wrote:"Amazon already offers something similar."
But only if you live in the USA. Amazon have said they are going to roll it out internationally this year, but I've seen no sign of it yet.
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Comment number 6.
At 20th May 2008, Martintb wrote:Of growing concern is the quality of the downloads available for purchase.
I want lossless audio, but I can't legally download it anywhere. The best quality seems to be 320kbps (more usually 256kbps) - vs average FLAC quality of 950kbps.
Lack of quality doesn't matter too much if you only listen to your music through a personal stereo, but it makes a big difference if you play it via your PC media centre on your 7.1 cinema surround system.
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Comment number 7.
At 20th May 2008, SteveFarr wrote:"So new models of consumption are emerging - among them pseudo-subscription services in which you buy the right to listen to as much music as you want at the point of purchase of a particular device."
This "all you can eat" model is the way forward not only for player/devices but ISP's services too. Take a fixed percentage of profit and pass it back to artists/creators. All that remains is the technology, be it based on the music store or download tracker site, that can do the click-counting so that each artist gets their slice of the cake.
Of course, copyright holders have to agree to it and there is stuff like differential pricing to overcome, should the industry wish to extend the model to TV, movies and other IP. Forcing adoption is going to require much regulation. But it will be worth it:-
1) No DRM means a better experience for users. PC Operating Systems start running faster (doing what they are supposed to do).
2) All downloading will be legal. All users need to do to be directed to the best quality download is register a "click" on an official site.
3) The black-market for illegally copied CDs and DVDs will disappear, so no funding for organized crime.
4) Closer to the day when all humanity, rich or poor may be creatively enabled, able to benefit freely, by having unlimited access to all the created work of mankind.
One day we shall look back on this fiasco of so-called illegal downloading and "pirating" with (hopefully) some amusement, in the same way as we look back on prohibition of alcohol in the early 20th century.
Beam me up now. Please.
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Comment number 8.
At 20th May 2008, bogusphotographer wrote:Given the recent battle over HD DVD and Blue Ray, I think consumers hate the idea of different formats competing all at once. It's annoying the music industry sees the future in these terms.
The reason music piracy took off and has become so embedded was that it gave people exactly what they wanted - wide availability (including rare tracks), DRM free music and music at a higher bit-rate than 128kbs.
The idea of tying people to one device on a subscription model is anti-competitive, counter to innovation (since the model is static) and gives control to the manufacturer rather than the consumer. The recent case where MSN music tracks would not work with Microsoft's 'Zune' and then the non-renewal of MSN music encryption keys (leaving users stranded so they couldn't authorize the music on other computers in future) shows the dangers of this strategy. Once for consumers to resist at all costs and will perhaps drive more and more people into 'free' music.
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Comment number 9.
At 20th May 2008, kingsimmy wrote:I agree that Drm will continue to exist on some music services. However consumers do not want drm in any form - drm always seems to bring excessive limitations. Also, it appears impossible to create any drm which cannot be circumvented. The protections on hd-dvd and blu ray were both bypassed within months. The 'formidable' hdcp can also be bypassed theoretically by converting the signal to vga and of course at the end of the day if an analogue signal is output it can be copied. Sound waves and tv images cannot be protected by drm!
In my opinion cd albums are definitely still the best way to access music. They may be slower to get than downloads etc. but they offer you a physical copy, greater sound quality than 99% of downloads and the ability to rip to mp3 and listen to on any device. Obviously record companies must prefer selling low quality drm'd downloads because that way they can sell us the same songs more than once ie once to play on an ipod, then charge you again to play it on your nokia mobile.
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Comment number 10.
At 20th May 2008, richard-ward wrote:It seems to me that it is irrelevant whether music has DRM or not. The people who wish to acquire the music by illegal means will do - such things are often easily removed and soon distributed accross many peer to peer networks. Those people who feel that music should be purchased will purchase the music by legal means.
I do not think that it makes a difference whichever way the music is made available as these two groups of people will still get the content the way they wish to get it. It therefore seems that removing DRM would be beneficial thus allowing consumers to be able to have music on multiple device.
In response to Bizniss who says that downloadable music is too expensive - I would disagree - I suggest that the portability of downloadable music counteracts the cost of production. Never before could we so easily listen to the same music at home, in the car, office or out walking - the medium was not suitable.
Just my thoughts anyway.
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Comment number 11.
At 21st May 2008, The_Saint_ST1 wrote:I do agree with the concerns of the artists to a certain degree in that blatant ripping off will always hurt them in their profession. However, those that will habitually rip off the artist, will continue to do so and penalising the majority of MP3 listeners who do buy MP3s by legal means is not the way
I have suggested that DRM be removed but replaced with a user stamp encoded directly into the music data. This way, any tracks that are copied, will carry the stamp of the purchaser and if lots of different tracks are spotted with the purchaser's stamp, then they can be brought to book for allowing their MP3's to be distributed.. a couple of songs may get them a warning, but for those who will distribute habitually, they could then be given a suitable punishment. Those found with the same stamped track may also be dealt with accordingly. The only flaw is that you may run into privacy issues.
And, I might add, that buying a track with a DRM 'virus' does not necessarily guarantee you CD quality music as I found to my dismay when I purchased a dance track from a well known UK online store - I this case, I may well have been better off trying to find a dodgy copy...
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Comment number 12.
At 21st May 2008, ak-a44 wrote:Over 10 years ago I saw the Music industry fearful and slow in taking up mp3's. Their appaulingly slow adoption of download music and the restrictive practices they introduced have successfully lost them billions of pounds of revenue and generated a hugh black market in "illegal" msuic files.
It is high time media creators abandoned DRM, which is wasteful of resource and money and started just providing media in the format consumers want.
I try and make sure all the media I watch and listen to is legal or I own a legal copy somewhere and I am more than willing to pay the copyright holders for _one_ copy. I believe in fair use, so if I want to watch a movie on my PDA then I will convert a DVD into something playable on the device. If I want to listen to a CD on my mobile/mp3 player then I will rip the CD and listen to it that way.
The more difficult the process of converting media is made, the more likely people will rely on someone else doing the technically hard stuff and get a copy of something off the internet. Once they have done that, why would they go buy the original media at all? If media came with a how-to or you could just download the converters from your media supplier, why bother with a copy off the internet?
I firmly believe DRM has and will continue to generate the black market in illegal DRM free files. The same black market that the media industry wants to stop and seems think DRM is the answer. DRM will always be broken and all you get is a few days/weeks/months before the next version of unbreakable DRM is as open as the last version. Make media easy to use and cheap and people will stop going to the illegal download sites.
The entertainment industry has lost a whole generation of customers, the longer it waits to sort this mess out the more customers it is losing. To me it is like a shopping centre turning away customers because they don't like the type of car they drive. Who cares how people get to the shop, if they want to buy your goods, let them.
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Comment number 13.
At 22nd May 2008, adarkmarc wrote:some online music stores and indie artists are offering their music in FLAC, this is to compete with the downsampled mp3 and give the listener a decent sound, as broadband gets faster n faster i see a future in 24 bit WAV downloads providing the listener with the optimum sound as it was recorded without the warmth and intensity being deleted by digital encoding...
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Comment number 14.
At 30th Jun 2008, Ankara wrote:DRM is dying. MSN decision to stop supporting DRM music bought from their online store is another nail in it's coffin. Basically, unless you intend to keep using the same PC and operating system for a very long time, the music purchased from MSN will be worthless.
The way forward is to offer quality (320kbps) DRM free music BUT at a much cheaper price than a physical copy of the music would cost. If download albums were offered at a much cheaper rate (e.g. 拢4.99) than a physical copy, there would be a huge surge in legal downloading. Amazon is taking a lead (at least in the US at the moment), but the big stumbling black is still the cost.
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Comment number 15.
At 2nd Jul 2008, MikeygIOM wrote:I personally believe that in order for systems such as iTunes and Napster to survive they will have to make all of there music DRM-free. They will have to offer a level of service so far unseen to their user, in order to stop them simply swicking over to illegal downloads, which are becoming easier to obtain, and with no foreseeable stop to their posting. And I say "all the better". If the service of iTunes increase then not only will they benifit, but more importantly so will the customers, the really important people in the business!
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Comment number 16.
At 3rd Jul 2008, justinionn wrote:Martintb - You can legally download Radiohead's 'In Rainbows' album as FLAC files from 7digital.com.
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