Major music labels ponder DRM-free future

“As even digital music revenue growth falters because of rampant file-sharing by consumers, the major record labels are moving closer to releasing music on the Internet with no copying restrictions — a step they once vowed never to take,” Victoria Shannon reports for The New York Times.

“Executives of several technology companies meeting here at Midem, the annual global trade fair for the music industry, said over the weekend that at least one of the four major record companies could move toward the sale of unrestricted digital files in the MP3 format within months,” Shannon reports. “Most independent record labels already sell tracks digitally compressed in the MP3 format, which can be downloaded, e-mailed or copied to computers, cellphones, portable music players and compact discs without limit.”

Shannon reports, “For the major recording companies, however, selling in the MP3 format would be a capitulation to the power of the Internet, which has destroyed their control over the worldwide distribution of music. Until last year, the industry was counting on online purchases of music, led by Apple’s iTunes music store, to make up the difference.”

“But digital sales in 2006, while 80 percent ahead of the year before, grew slower than in 2005 and did not compensate for the decline in physical sales, according to an industry report released in London last week,” Shannon reports.

MacDailyNews Take: The ability to buy (or steal) singles – or only the good songs – cuts into the labels’ profits as they can longer rely on selling 1 or 2 good songs bundled with 8 or more filler tracks as they could with physical media like CDs.

Shannon continues, “”There is a groundswell, and I say that on the basis of private conversations,’ said Rob Glaser, chief executive of RealNetworks, which sells digital music protected against piracy through the Rhapsody subscription service. ‘It will happen between next year and five years from now, but it is more likely to be in one to two years,’ he said.”

Full article here.
Today’s easily-removed DRM only hinders legal users, not the pirates. Removing DRM will increase online music sales. Bring it on – the sooner, the better!

Related articles:
Report: Apple to license FairPlay DRM – January 17, 2007
Hollywood movie studios demand Apple strengthen DRM limitations before joining iTunes – November 29, 2006
Apple’s vs. Microsoft’s music DRM: whose solution supports more users? – August 17, 2005

44 Comments

  1. Unless the music industry has a terrific incentive for people to buy unprotected music online (something good–not a legal threat), we will see the rebirth of the old Napster about 2 minutes after they start offering their catalogs DRM-free.

  2. You can’t expect them to embrace change if it means lower revenues. To increase revenues, they have to up the ante on products: sell video which is more bothersome to pirate by way of size; release more versions – the studio tapes, live performances, interviews, the making of a song… etc., etc., etc.

    And yes, remove DRM but sell the compressed [mp3] versions cheaper. Much cheaper. Cheap enough so that the ones who pirate are the ones who would never buy anyway. And properly tag the files with album art, lyrics, etc.

    And while they’re at it, they might consider a different format with separate vocal tracks and optional display of karaoke-style lyrics. Or have an optional video track which can be turned on and off separately and does not necessarily include the artists performing, if you catch my drift. And if you’re selling cds, include extensive album art, lyrics, reviews or comments or anything that adds value…. Geeze, I could go on and on!

    There’s lots to do if they got off their asses and tried innovating. Unfortunately, most of them can’t even figure out how to use a washlet toilet.

    1) Kill DRM – it’s useless;
    2) Cheaper online mp3s – much cheaper;
    3) Product innovation;
    4) Did I mention cheaper?

  3. “…”The newer .m4p compression (also called AAC) is an industry standard replacement for .mp3…Actually, m4a is the AAC standard format. m4p is AAC with Apple’s FairPlay encryption applied to it, making it somewhat non-industry-stand…”

    Well, yes AND no. I am correct that AAC is the basic industry standard audio format designed to improve and eventually replace .mp3, and (Ryan is right in that .m4a files can be found in the iTunes folder (if the music is imported, using iTunes, from a CD). However, protected AAC files (.m4p, sometimes called AAC Plus) also can be found in the iTunes folder (if you purchase DRM-protected songs from the iTunes store). Protected AAC (AAC Plus) is just a basic AAC file with Apple’s Fairplay DRM wrapper added.

    The point is, their actually is a difference between AAC and protected AAC (AAC Plus) files, but only one (AAC) s an actual audio file type.

  4. This would be great for online music. Unfortunately, I’ve heard that Apple has stated they will not remove DRM from iTunes even if the RIAA no longer requires it. If this turns out to be true, then it will prove that Apple is using DRM to lock you in to their products. If in the future, I can purchase songs online in a DRM free format, preferably FLAC, then I’ll be a very happy camper and Apple can kiss my ASS.

    I love all my Apple computers, but I value open standards more.

    Lets hope that if this does happen, then Apple follows along. It will be nice to have real competition for once with online music.

  5. So I take it all these beleagured record companies will allow iTunes user to download previusly unprotected purchased music again in a higher quality format. When they do that I will believe they are sincere.

    mw: efforts as in they are making numerous efforts to try to end Apple’s successful efforts at providing a legal alternative to piracy. Poor record companies. Apple must have made them use DRM.

  6. Apple will not remove DRM you pop-tarts.
    They have as much at stake as the labels do – unprotected = theft.
    You babies have proven them right and have only your thieving selves to blame.

    MDN: your take is as stupid as the reasons are for stealing music.
    Thieves are thieves.

    In fact, I’m going to start a website and “borrow” all of your material.
    We’ll see how YOU like it.

  7. I, for one, will believe a DRM free universe when I see one.

    The guys who run The Labels are greedy bastards who are convinced that the MP3 player manufacturers, artists, technicians, backup singers, backup musicians, music composers, lyrics writers and consumers are all out to screw them out of ‘their’ money.

    There is no way they will open up ‘their’ music to make it any easier to steal ‘their’ money.

  8. There is only one word to describe people who cannot comprehend why others sample music by downloading it from P2P networks: ignorant. I guess if you have no friends and live under a rock somewhere without broadband, you can vomit up your malformed ideas as a troll on MDN.

  9. At the moment I have no interest in buying aac files, the quality is pretty poor compared to a CD or LP, I would rather buy the CD’s and Limewire the music I have a vague interest in, sorry. itunes downloads need to be in offered in a CD comparible format or better and much cheaper.

  10. I have a suggestion to the record industry: Start making really good albums that have longer tail a.k.a. sell better in a long run. Filler tracks are total shit. The pop album that I can remember from 90’s that didn’t have Filler tracks was New Radicals’ Maybe You’ve Been Brainwashed Too. OK, it isn’t really that pop, it’s just closest I’ll ever get to pop music.

    Point is: Beatles, Jimi Hendrix, Rolling Stones, etc. are still selling a lot albums every year. I don’t see any one asking about Britney Spears’ first album in the record stores.

    If the record labels started to aim at making most albums really good in terms of music, they might see their cash flow go up. At least I’m not gonna buy some shit like My Chemical Romance or what ever it was.

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