Friday, March 02, 2007
Apple v. RIAA
Once a year, whether I need to or not, I post here. At least, that's how it seems to be working out! At any rate, I just have to weigh in on the whole Steve Jobs and recording industry banter about DRM. Here's my brief summary:
Steve Jobs says something like, "Hey, I hate DRM because it makes my company more expensive to run. The RIAA makes us do it!"
RIAA says something like, "Hey, I hate DRM because Apple won't let us charge more for music. Steve Jobs makes us do it!"
When I think about this, and I think about the overall market share that Apple has in the recording distribution pipeline, I can only come to one conclusion. That conclusion is that there is still a lot of fear about releasing DRM-free music. Everyone knows that consumers either don't like it or don't care -- nobody "likes" DRM. I think consumers are far too willing to give up freedoms via things like the FairPlay licensing agreement. Everyone knows that it impedes the progress of digital music (and other media) in general (score one for Steve Jobs). Everyone knows that removing DRM would cause a dramatic up-tick in the overall usage of digital media (and not all of that benefit would belong to iTMS; score one RIAA). Here's what you won't be hearing from anyone:
Steve Jobs WON'T say, "DRM is great, because it makes people use the iPod to get access to the iTunes Music store! I love lock-in!" (Even though this has to be, at least in part, true)
RIAA WON'T say, "DRM scares the crap out of us because we're afraid most of the 'dramatic up-tick' will be illegal re-distribution of free track that we pay millions of dollars to cram down teenagers' throats!" (Okay, I'm showing some personal bias here, but let's face it: the twenty- and thirty-somethings that are downloading music are much more likely to pay a dollar to avoid seeing certain advertising and possible malware infection than the teens are. Teens think their computers are indestructible!)
In reality, though, music is incredibly easy to redistribute as it is. Someone just has to shell out $11.99 for a CD the week it comes out, and they can share it with millions of their closest friends. So, how has iTMS served billions and billions of electronic tracks? Well, I heard from a friend that the quality of ripped CDs on free services is subject to wide variations in quality. People buy bootlegged DVDs from guys who go into a noisy theater with a hand-held camcorder, too. Let's face another fact: the people who download free music and buy bootlegged DVDs aren't going to buy this stuff at the prices the media companies need to charge, no matter what. If it's not available at ultra-low-cost, they will just do without. I think it's time to start considering the viral effect of these sharing activities and start counting it as a marketing expense rather than as outright theft. (In my humble opinion, certain top-selling stars could afford a 1-2% pay cut to subsidize this free publicity.) I certainly don't condone piracy (hey, I'm a software guy; plenty of people could steal the stuff I've written over the years at zero cost, and I wouldn't like it!). But when it comes to DRM, it didn't work for the software industry (at least the first time; the media industry has inspired companies like Microsoft to try again, this time with the network instead of a box you plug into your serial port), and I don't think it's likely to work out for the media industry.
Steve Jobs says something like, "Hey, I hate DRM because it makes my company more expensive to run. The RIAA makes us do it!"
RIAA says something like, "Hey, I hate DRM because Apple won't let us charge more for music. Steve Jobs makes us do it!"
When I think about this, and I think about the overall market share that Apple has in the recording distribution pipeline, I can only come to one conclusion. That conclusion is that there is still a lot of fear about releasing DRM-free music. Everyone knows that consumers either don't like it or don't care -- nobody "likes" DRM. I think consumers are far too willing to give up freedoms via things like the FairPlay licensing agreement. Everyone knows that it impedes the progress of digital music (and other media) in general (score one for Steve Jobs). Everyone knows that removing DRM would cause a dramatic up-tick in the overall usage of digital media (and not all of that benefit would belong to iTMS; score one RIAA). Here's what you won't be hearing from anyone:
Steve Jobs WON'T say, "DRM is great, because it makes people use the iPod to get access to the iTunes Music store! I love lock-in!" (Even though this has to be, at least in part, true)
RIAA WON'T say, "DRM scares the crap out of us because we're afraid most of the 'dramatic up-tick' will be illegal re-distribution of free track that we pay millions of dollars to cram down teenagers' throats!" (Okay, I'm showing some personal bias here, but let's face it: the twenty- and thirty-somethings that are downloading music are much more likely to pay a dollar to avoid seeing certain advertising and possible malware infection than the teens are. Teens think their computers are indestructible!)
In reality, though, music is incredibly easy to redistribute as it is. Someone just has to shell out $11.99 for a CD the week it comes out, and they can share it with millions of their closest friends. So, how has iTMS served billions and billions of electronic tracks? Well, I heard from a friend that the quality of ripped CDs on free services is subject to wide variations in quality. People buy bootlegged DVDs from guys who go into a noisy theater with a hand-held camcorder, too. Let's face another fact: the people who download free music and buy bootlegged DVDs aren't going to buy this stuff at the prices the media companies need to charge, no matter what. If it's not available at ultra-low-cost, they will just do without. I think it's time to start considering the viral effect of these sharing activities and start counting it as a marketing expense rather than as outright theft. (In my humble opinion, certain top-selling stars could afford a 1-2% pay cut to subsidize this free publicity.) I certainly don't condone piracy (hey, I'm a software guy; plenty of people could steal the stuff I've written over the years at zero cost, and I wouldn't like it!). But when it comes to DRM, it didn't work for the software industry (at least the first time; the media industry has inspired companies like Microsoft to try again, this time with the network instead of a box you plug into your serial port), and I don't think it's likely to work out for the media industry.
Labels: apple, drm, free music, riaa
