No More DRM?

Album sales decreased in 2007 by 15%. Digital downloads (often single tracks), however, increased — by 49%. And even if that number is figured in with album sales per se — industry standard assumption is 10 tracks per album — album sales overall still decreased by 9.2%. [from New York Times]

Maybe that might account for this ... [from Business Week]

In a move that would mark the end of a digital music era, Sony BMG Music Entertainment is finalizing plans to sell songs without the copyright protection software that has long restricted the use of music downloaded from the Internet, BusinessWeek.com has learned. Sony BMG, a joint venture of Sony (SNE) and Bertelsmann, will make at least part of its collection available without so-called digital rights management, or DRM, software some time in the first quarter, according to people familiar with the matter.

Sony BMG would become the last of the top four music labels to drop DRM, following Warner Music Group (WMG), which in late December said it would sell DRM-free songs through Amazon.com's (AMZN) digital music store. EMI and Vivendi's Universal Music Group announced their plans for DRM-free downloads earlier in 2007. <...>

Many, including music executives, consider the industry's about-face long overdue. "This agreement is the first of many of these types we'll be announcing in the coming weeks and months," Warner Music Group Chief Executive Edgar Bronfman Jr. wrote in a Dec. 27 memo to employees explaining Warner's breakthrough deal with Amazon. "Many have argued that we could and should have done this long ago." <...>

[emphasis mine] "DRM tends to punish the innocent more than the guilty," says Rob Enderle, principal analyst at the Enderle Group, a technology research company. "It was hurting folks who were trying to follow the rules more than the folks who were pirating the music."

Labels used DRM software in an effort to prevent illegal sharing of songs on peer-to-peer networks, such as Gnutella. Instead, the restrictions served mainly to frustrate paying customers, forcing them to degrade the quality of music by first burning it to a CD before uploading it for play on the device of their choosing. <...>

Rather than following EMI's lead, other labels are hoping to create another Apple competitor in Amazon, which is willing to give the recording industry greater pricing flexibility.

Apple has had a holier-than-thou near monopolistic stranglehold on digital downloads, disingenuous at best.

Because DRM tended to tie consumers to the store most compatible with their music device, the record labels unwittingly gave much of the power over music distribution to Apple, the manufacturer of the most popular digital music player, the iPod.

Music industry executives say Apple has not wielded that power lightly. With control of an estimated 80% of the market for legally downloaded music, Apple pushed its preferred price of 99¢ per song over the opposition of several labels, which preferred variable pricing that would allow some artists to sell at a premium.

Apple CEO Steve Jobs also refused repeated requests from the recording industry and iPod competitors to license its DRM technology so that iTunes customers could easily put their music on other devices, without first burning it to a CD or otherwise altering the files.

• I was alerted to the Business Week piece by blog Musick in the Head.
• More from me on this topic: here.
• My most recent digital download (paid-for, of course): Levon Helm's Dirt Farmer. This is the first studio album in a quarter-century for this former drummer of The Band. It's a remarkable collection of music.