Seriousness and spin: The Steve’s DRM gambit

Another disruptive technology

Last week Apple published a letter setting out its thinking on DRM, downloads, interoperability and the music industry. As a corporate communication it seeks to serve Apple’s interests, of course and can be fairly seen as a response to the legal onslaught iTunes faces in many European countries which allege that proprietary FairPlay DRM is anticompetitive.

While Apple’s argument that security dictates it must not share FairPlay for the sake of security is fatuous, the idea that the iTunes Store and FairPlay protected files are a monopolistic practice are absurd spin in themselves. It is spin by and for the current losers in the market. The Creatives at el fighting over the scraps.

Anyone who is well informed knows that the vast majority of music on any given iPod is fully unprotected and can play happily on nearly any music player or software. Tight vertical integration in media players seems to make consumers and content providers happy (witness Microsoft’s equally proprietary new Zune system) and while Apple is the largest player in the market there are few barriers to entry and this position is by no means assured.

The idea that people would spend £5,000+ on compressed, tinny downloads to fill up a £200 media player has always been as silly as a clown on laughing gas. Online downloads are poor value on the whole. CDs have unbeatable uncompressed sound and can be backed up or converted to any digital format you choose forever. I just ordered David Bowie’s entire Berlin trilogy online on CD for the price of 1.6 LPs worth of digital downloads or chart trash on the high street. The Apple letter states that just 3% of music on an average iPod is DRMed. DRMed downloads are less than 10% of music sold (the rest is on CD). My iPod is in fact devoid of any protected tracks, as are those of many people I know. Even The Economist, no friend of piracy, published a leader this week agreeing with Apple’s argument and noting that it is well equipped to complete without any monopolisitic trickery.

DRM has no consumer value proposition at all, and that is why it has always been a doomed (or at least heavily troubled) concept. However, much of the golden age of record companies found them in a DRM-free position. Consider the simple audiocassette. I would find it easy to believe that even less than 3% of tapes were ever ‘officially’ recorded – they were taken from LPs, CDs, radio and other tapes. People used them as a format to take their music everywhere, just like an iPod. Music companies fought ‘home taping’ tooth and nail before broadly accepting that some fast and loose fair use (and piracy) was inevitable and took a few pennies on every tape and player sold in exchange for silence (as they carried on raking in cash anyway). They need to grow up again – all hardware makers should join up in resisting the DRM status quo to help them do so.

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