Posted by: Peter Burrows on January 04
In his “Thoughts on Music” memo last Spring, Steve Jobs said the only reason Apple used its Fairplay anti-piracy software was because the record labels demanded some protections to ensure songs purchased via iTunes couldn’t be endlessly copied and shared. If he had it his way, he suggested, there would be no DRM, and consumers would be able to use any device (iPod or otherwise) with any music service (iTunes or otherwise). “This is clearly the best alternative for consumers, and Apple would embrace it in a heartbeat,” he wrote. “If the big four music companies would license Apple their music without the requirement that it be protected with a DRM, we would switch to selling only DRM-free music on our iTunes store.”
Well, he might be able to do just that, soon enough. My colleague Catherine Holahan broke the news yesterday that Sony BMG will embrace a non-DRM future. This follows close on the heels of Warner Music Group’s move in this direction in late December, and Warner followed the lead of EMI and Universal Music earlier in the year. As a result, the major labels seem to all be saying they no longer want protection from FairPlay or any other DRM system. Since selling music through iTunes hasn’t extricated them from a miserable industry-wide drop in sales, it seems they’re prepared to let the music flow more freely, and hope that online distributers—particularly Amazon—can convince enough people pay for it.
This disconnect is sure to raise tough questions from Apple critics, many of whom thought Jobs was just bluffing back when he wrote that memo—that while he blamed the labels for DRM, that Apple itself was in fact the primary beneficiary. And on top of the PR problem, there are also legal ones. The latest comes in the form of this well-timed motion (registration to the Federal Court’s electronic filing system required) filed on behalf of one Stacie Somers.
The class action suit, which I learned about through this Information Week piece, was filed in District Court on Jan. 3 in Apple’s home district. It accuses the company of “monopolizing behavior” and anti-trust violations based on its use of FairPlay. It alleges that Apple has improperly used FairPlay to tie iTunes and iPods into a closed system that prevents iPod owners from playing music purchased from competing services, and prevents iTunes shoppers from playing music purchased there on anything but an iPod. Specifically, the suit charges Apple with improperly “crippling” the processors in its iPods so they would only play “Apple’s Fairplay-modified AAC format,” when those chips are used in other music players to play songs encoded in Microsoft’s Windows Media Format.
So will we see big FairPlay news at MacWorld? Will Jobs fulfill his pledge and dump FairPlay? I highly doubt it. My hunch is that he believes it is too strategically important. Heck, I wonder if all of those music execs who are lambasting Apple would even want him to (unless Jobs were to also agree to give them the flexibility to stray from his $.99 per song orthodoxy, as well). In a way, they’ve got the best of both worlds: they’re free to run their various experiments in DRM-free music, comfortable in the knowledge that Apple is maintaining some protections at the only site that really matters. Sure, Amazon, Facebook, iMeem and others have potential. But iTunes still has over 80% market share of digital downloads.
But while FairPlay will still be with us post-Macworld, I don’t think Jobs will be able to skirt the topic entirely. Given all the remarkable changes in the music business in the past few months, I’d say its time for a “More Thoughts on Music” memo from Steve.
For me it seems that you are blaming Apple rather than the big record companies for the use of DRM in the iTMS. Isn't it more likely that the big record companies (except EMI) won't sell DRM free music in iTMS, but only in other online music stores because they fear that Apple will be to powerful.
You're being a knucklehead, Peter.
The music labels forced Apple to use DRM when Apple opened the iTunes Store. Now that the iTunes Store has become far more successful than the Labels ever imagined, the labels have come to fear Apple’s dominance in digital downloads. As a result, several of the labels (Universal & Warners) are trying to stick it to Apple by continuing to require Apple to sell their product with DRM while they make it available to Amazon and Walmart without DRM.
The funny thing is part of their dispute with Apple was that Apple refused to budge when the Labels insisted on pricing schemes that would have cost consumers more money. So in a “cut your nose off to spite your face” move they are letting Amazon and Walmart sell their music for even less than Apple charges.
I think it is ironic how now that Apple has the biggest share of online music and portable music players they are getting attacked by people who want competing formats on their iPods. Before the iPod ever came into existence nobody cared that competing players and music didn't work on Macs and still they don't care.
Job's was the visionary who convinced a scared group of labels that legal downloads were the future. The only way they would agree to doing that and not having another Napster was to have some sort of DRM. At the same time, Microsoft was developing the Janus DRM which changed it's name to "Plays for Sure" when it did ship, and now if you buy a Zune, all of that music will not work on it.
The reason some labels don't want non DRM music on iTunes is that they want to be able to jack up the price once you get hooked on it. Job's won't allow it. You might say that Apple gets a lot of money from iTunes music sales, but I doubt it, the costs involved in keeping the infastructure of iTunes going eats up anything Apple makes from the music, they make it up on sales of iPods.
The biggest reason why I am so tired to people complaining is this: If you are so adamant about no DRM go buy the music CD and rip it to iTunes or Winamp or whatever you want. Don't blame Apple that you are too lazy to take a few extra steps. If you don't like MP3 or AAC, then don't buy an iPod, and if you don't know how to rip a cd then you probably should stick just using CDs.
The Stacie Somers suit, and myriad other grandstanding actions like it, really aren't worth reporting on. I suppose the plaintiff is also suing Microsoft, who does the same thing with its Zune and Zune Marketplace? Or Sandisk, Creative, and others, who use Microsoft's PlaysForSure (or whatever MS rechristened that lame duck)? Last I looked, nobody's player played protected music from other sources. iPods won't play Zune Marketplace tracks and vice-versa. For that matter, Zunes won't play tracks protected by one of Microsoft's own DRM schemes!
These suits are silly and wasteful and should be dismissed as soon as they are filed.
I think that Steve Jobs would get rid of *music* DRM, the instant the record companies let him. The fact is that the record companies have been trying to undermine iTunes by selling higher bit rate DRM free music via other services, while only offering the DRM stuff to Apple/iTunes.
Apple is getting no benefit from selling DRMed music at this point -- it discourages an active, well informed group of users from buying it.
Meanwhile, iPhone/iPod/iTunes don't need DRM lock in to beat the sorry competition. Where are the iPod Touch competitors? There isn't a single one. Zune (and others) are competing against previous generation iPod's... By the time they copy the current ones, Apple will be three steps ahead yet again.
Jobs can't drop Fair Play without the music companies approval. Apple is under contract with them to maintain the Fair Play DRM format until they revise the contract. The ball is clearly in the record companies court. Most have chosen not to release Apple in favor of Amazon.
Please do some fact checking and analysis before you write.
Basic sophmore high school research, I believe.
I truly believe Apple could and would drop fairplay today on all of the FUTURE iTMS purchases, its the entrenched customer that have previously purchased music that Apple will never let go of.
The real story, music is dyeing, video is where they are going, the video industries LOVES DRM. The dance starts over one more time.
Music is dying James? What planet are you living on? Surely not the one that saw 760,000 new albums released in 2007. Roughly 1/10 that number were being made 25 years ago. Maybe the business of selling recorded music is dying because the largest consumers of music were driven to illegal distribution systems by the dinosaurs known as the record industry, but there are more people making and consuming music today than there were at any point in history.
Haven't you noticed that no one besides EMI has given permission to sell non-DRM music on iTunes. So, unless you think that they are going to change their minds in the next 2 weeks or that Apple is going to stop selling music on iTunes, what kind of announcement are you expecting?
Make no mistake, the current actions of the studios to not remove DRM from iTunes shows who is still the roadblock. It is not Apple.
Actually iTunes already offers DRM free Music... EMI's music on iTMS is DRM free and also is finally at CD quality (256Kbps AAC.
I purchased Gorillaz Demon Days from iTMS ... its awesome!
Actually iTunes already offers DRM free Music... EMI's music on iTMS is DRM free and also is finally at CD quality (256Kbps AAC.
I purchased Gorillaz Demon Days from iTMS ... its awesome!
Why is 99 cents for a song Steve Jobs' orthodoxy?
You dismiss the consumer's choice. Remember we had the choice to buy songs for 99 cents or rent them from Microsoft. We've had the choice to use any number of PlaysForSure players.
We've always had a choices, and yet you prefer perpetuating the myth that Steve Jobs has hypnotized us.
Go Stacie Somers.
Before anyone dismisses Stacie's law suit, please read or reread the trial judge's ruling as well as the appeals court's ruling involving Microsoft as well as Image Technical Services v. Kodak (1994). Those three rulings provide the legal reasoning for Stacie's suit.
Apple needs to find the best antitrust attorney because this suit appears tough.
If her suit is successful, and I believe it has merit based on the Microsoft and Kodak rulings, then this opens the door to sue Apple for its Macintosh EULA.
Hooray! The day we can use the best OS (Macintosh) on the best lap top (ThinkPad) instead of the best table top (Mac Book) may be a step closer to reality.
Go, Stacie, Go!
Either the author has no grasp of this subject, or he is just trolling for hits. In either case this article is not worth reading.
Fact: You can play any non-DRM music on iPods.
Fact: Of all the software companies out there, Apple has the consumer friendly EULs.
Fact: Apple has never used DRM to control installation of its own software, unlike MicroSoft. Why would they choose to impose it on music owned by the record labels?
The author should try doing some research or critical thinking for a change!
I think Apple has no interest whatsoever in DRM; either they all drop it, or no-one drops it and from there the future may begin.
"Music distributors" as they existed until now, are obsolete. Music distribution is no longer a matter of "physical goods", like vinyl, being shipped around. Practically, Itunes is the biggest distributor worldwide. It is also "mono-product", unlike, say Amazon who to most people (especially in Europe) is more like a "digital WalMart..
Yeah, a little naive to think that Apple can just drop FairPlay on a whim if they really wanted to. These lawsuits need to target the source of the problem; the music labels.
Even before his open letter last February, Steve Jobs was quoted as saying that DRM would never really work, that someone would always find a way around it. That was back when Mac users didn't even have an option for purchasing music online and a time when almost all the online stores were pretty much renting music.
Microsoft wants you to think their DRM system is open because you can choose from several devices and online stores that support their DRM. However, Microsoft makes a their money off Windows and as such have decided to lock all "Plays for Sure" and Zune content to Windows.
The stupid thing is that Apple's Fairplay is trivial to circumvent, and Apple provides the means to do this.
Using an app like DRM Dumpster you can easily remove the DRM from iTunes purchases. It utilises the fact that Apple allows you to remove DRM from purchases in iTunes - all you need to do to move any DRM iTunes purchase to other players is export them to a CD or DVD. (DRM Dumpster automates this for you)
Now if that is a heavy handed lock in I hate to think what folk will call Microsoft's much more insidious DRM!
"its the entrenched customer that have previously purchased music that Apple will never let go of"
Well, afaik you can convert drm:ed music to non-drm:ed music in iTunes (but You have to pay extra for it), so it's not really a lock in for old buyers either.
A blog on the daily doings of Apple and the many companies in its orbit, with insight and analysis by two longtime Apple-watchers BusinessWeek Senior Writer Peter Burrows and BusinessWeek.com Senior Technology Writer Arik Hesseldahl.
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