What do you think about DRM?

[hundredstrings]

Here is my take:

What is all the fuss about DRM?  Let’s be honest—if music is available for free, nobody is going to BUY it!  Saying that CDs didn’t have DRM and why we need it now (for online downloads) is an irrelevant point.  In fact, it was the CD (combined with internet & compression technology like MP3) that paved the way for mass piracy.  So, we need to resolve it.

There are three types of pirates:

Type 1: Individuals and institutions who create illegal duplicates for financial gain
Type 2: Irresponsible and ignorant music fans who “spread” the music by freely exchanging them, putting them on P2P networks
Type 3: Consumers who don’t believe in paying for music and want to get it free from Type 1 & Type 2 pirates above!

Let’s look at the evolution of music technology:

1. Prior to LPs --> no recordings, only live music, no chance for piracy!
2. LPs --> recording was done in factories, not available to consumers, so very less or no piracy
3. Audio Cassettes --> more music could be stored per unit (compared to LP), more portable, recording equipment accessible to consumers --> Increased Type 1 piracy and some Type 2 piracy
4. CDs --> Easy to store and transport, extremely easy to copy, selected tracks can be copied since random access is possible, very easy to mass-copy with compression technologies like MP3 freely available, very easy to share with a large number of users using internet --> dramatic increase in both Type 1 [some people put free/illegal content on their sites to attract traffic and earn ad revenue] and Type 2 [ignorant music fans who think they are doing a “service” to the society by “sharing"] piracy; Type 3 community grows without bounds and “free download” tends to become the de-facto option for acquiring music

Who says DRM isn’t necessary?  How do you protect your music if you were someone who has INVESTED his/her money on making music?

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I have been buying music from both iTunes AND eMusic and I find absolutely no problem with iTunes DRM or no advantages of DRM-less eMusic downloads.  What I really care for is:

- Ease of finding the right music
- Ease of accessing content metadata (like reviews, user playlists, artist bio, recommendations etc)
- Ease of downloading and managing the downloaded tracks

Though eMusic doesn’t have DRM, and it is a lot cheaper to buy from there, I still consider iTunes as far superior because it is a “one stop shop” for all music and it is so easy to find what you want… eMusic is designed to let users download AS LESS AS POSSIBLE [obviously, they want your unused subscription money] whereas iTunes is quite the opposite.  It is far easier to sample the music on iTunes.

What Steve Jobs has proven is that more people may like to get the music from “good” places if it is easier and cleaner that way…

I conclude that there should be some kind of DRM, even if it is not as restrictive as the current technologies, music companies should have a way of identifying Type 1 and Type 2 pirates, who are the souce of all piracy.

Some references:
1. Digital Rights Management -> http://en.wikipedia.org/wiki/Digital_Rights_Management
2. Steve Jobs' "Thoughts On Music" -> http://www.apple.com/hotnews/thoughtsonmusic/
3. This Just In: Steve Jobs To Music DRM: Drop Dead -> http://www.paidcontent.org/entry/this-just-in-steve-jobs-to-music-drm-drop-dead/ (my comments posted here as well)

[hundredstrings]

Found this interesting article on Express Computer which also says DRM is required, especially for Indian music & movie industry:

http://www.expresscomputeronline.com/20040202/newsanalysis02.shtml

DRM can help Indian music industry combat piracy

While the digital format helps music companies to expand their market, it unfortunately also reduces the control they have over content. Is there a way that music companies can turn the reach of the Internet to their advantage? Digital Rights Management (DRM) could certainly be one way to hand over control of content back to the rightful owner, says Srikanth R P.

According to a recent IFPI (International Federation of the Phonographic Industry) report, it has been estimated that the Indian film industry alone loses around Rs 3 billion each year due to piracy. The music industry on the other hand has to cope with losses up to Rs 5 billion per year. Given the paucity of good films and music, piracy can wipe out the Indian film industry in the years to come, unless there is a clear-cut mechanism to control easy duplication of content. Additionally, while downloading of files has gained acceptance among music lovers, it is also a fact that legally available digital content for sale on the Internet is still limited. This is because content owners are still not convinced that their copyrighted works are safe in the cyber world.

Is there a solution in sight? Digital Rights Management (DRM) could be one way of taking advantage of the reach of the Internet while maintaining the rights of the content owner. DRM in simple terms could be termed as a technology that enables the secure distribution, promotion and licensing of digital content. DRM could be more effective in a country like India, which produces the most number of movies in the world. But despite the big market potential that exists in a country of more than a billion people and millions of people of Indian origin abroad—the Indian entertainment industry still makes huge losses. One of the big factors contributing to these losses has undoubtedly been piracy. This is where the concept of DRM could help the Indian entertainment industry combat piracy and increase revenues through a medium not yet tapped by them—the Internet.

Looking at the potential of the Indian market, Next Gen Media Alliances, a specialist company in the space of DRM, is betting big on the adoption of the concept by the Indian entertainment industry. The company is pushing its platform called NGMA DIAS for enabling companies to get back control over digital content. Says Jai S Rajagopal, director, Business Development, Next Gen Media Alliances (NGMA), “The NGMA DIAS platform can enable companies to regulate and control the flow of content through mediums like the Web, peer-to-peer, PC and the mobile environment. Looking at the immense market potential, we aim to become the single gateway for Indian entertainment content on a digital platform that caters to the global market through the Internet and mobile platforms. This would ensure a payment for each download.”

In India, typically every ringtone download worth Rs 7 gives the developer only Rs 1.50 in return. The rest is shared between the music company, data carrier and the network operator. If the digital distribution of songs in India takes off, then the same situation could be seen—with no guarantee of regulation of content. NGMA wants to avoid this and is aiming to put control over content back in the hands of the owner.

Besides ensuring encryption of content, the platform even has an advanced search engine that can search the Internet for illegal storage of content on the Web. All an artist has to do is register content on the NGMA DIAS platform. The company is already in talks with a number of musicians and record companies who are looking at the Internet as a medium to grow their revenues. The platform could also be a shot in the arm for young and talented artists in India who have otherwise been overlooked by the big record labels. Using the Internet as a medium, these artists can gain valuable exposure. If their songs can manage a significant number of downloads, the artists can not only earn money by way of a license fee per download, but more importantly, go back to the record companies armed with statistics of downloads.

While the future of digital distribution has always looked bright, the key obstacle was piracy. If DRM can help in curbing this monster, then the Indian entertainment industry surely would be benefited immensely by the inflow of revenues through a medium (Internet) they have never tapped.

[hundredstrings]

Interestingly, CNET started a discussion about illegal file sharing:

Community Newsletter: Q&A: Is peer-to-peer software such as LimeWire legal and safe to use?
http://forums.cnet.com/5208-10149_102-0.html?forumID=7&threadID=237409&messageID=2424370

[ragaworld]

Wow! RIAA has set up this web site, which could serve as a red alert for all those who use P2P software to swap copyrighted material and those who download pirated music from the internet:

http://www.p2plawsuits.com/

[vikram]

I can not understand why people need to download illegal music or for that matter software.  If you spent months or years developing something, would you like if somebody else was freely distributing it over the internet?  One can now buy tracks for as low as 99 cents on itunes so there is no real reason why one should illegally download anything. 

Digital rights management is still in a very nascent stage and various stakeholders in the industry need to come together to develop an industry wide best practice.
Music and software piracy  / illegal download laws should be made stronger and enforced appropriately to ensure that the perpetrators are brought to book.

Vikram

[classical_fan]

I was looking to CrimsonBay.com, the (so called) download service dedicated to Indian music...  It is very far from perfect and lot of users are complaining.  I think piracy should be addressed in two ways:

1. Make all the music available in digital form for a fair price -- the download service should be stable and easy to use
2. Take legal action against pirates (including the ones who download illegal music)

A lot needs to be done in both the areas as far as Indian music is concerned.  One smart technique followed by the music companies in the west is that they put tons of spurious music & video (disguised as "proper" music/video) on the peer-to-peer networks.  For example, if you search for the movie "Titanic" you might find a thousand results, most of which are the "phony" versions uploaded by content owners...  So, the person downloading would get frustrated and driven to change his/her habits -- to get the content from legal and clean marketplace.

Since the legal system is very weak in India, music companies should take the help of technology to address the availability issue (point #1 above) first.  Why not work it out with Apple and get iTunes into India?  Presently, iTunes is the only service that gives you the "complete" experience -- hardware (iPod), software (iTunes), and content (music/podcasts/video/movies/audiobooks etc) -- all under the same roof!  It is not easy for an Indian company to replicate such a thing.

[Sumanth Sharma]

I assume by listening to streaming music listed on "musicindiaonline.com" and not violating DRM

I usually buy music [though am a poor young kid - working for 41 /2 years with lots of commitments ], I buy music albums which I cannot live without [roughly have some 200 cassettes, 40-50 music CD's], rest I listen to streaming content available  in musicindiaonline.com

My father had 500+ cassettes; but many no longer function, he is a great music buff and a even better singer - His advantage - he can sing, but I can only listen

My monthly budget for Music is 1CD/album [assuming it costs not more than 500], I cannot afford to buy everything, at least for another 5years - I have to spend carefully else my Wife will CTRL-X me

Please clarify. What best can I do ?

[hundredstrings]

The best way might be to listen to the music on streaming channels (if one is available) before deciding to buy them.  You can also listen to other fans' recommendations.  Though I used to blow up a lot of money on CDs and cassettes, I was still choosy.  There are only a few artists in the industry who produce consistently great albums.  I believe Shivkumar Sharma (all albums) and Hariprasad Chaurasia (all except fusion music) are two such greatest of the great artists.

BTW, I am also getting all kinds of music from eMusic these days, though it is quite painful to find the albums -- eMusic might be the cheapest (and, of course, legal way of buying music.  It is best for budget-sensitive and die-hard fans of music.  But I don't recommend eMusic generally because it might be detrimental to Indian classical music -- eMusic is built for American/western mainstream music and it is not tailored for long tracks like how we have in our classical music.  eMusic has the most unique online model among all the major players -- it is based on a monthly subscription wherein you get a fixed number of downloads and you get to keep everything you download.  The downloaded songs don't "expire" once you stop your subscription (there is no DRM, it uses high bit rate MP3 files).

[hundredstrings]

Even while we are talking so much about it, see what Apple announced yesterday (02 Apr 2007):

Apple Unveils Higher Quality DRM-Free Music on the iTunes Store
DRM-Free Songs from EMI Available on iTunes for $1.29 in May

CUPERTINO, California—April 2, 2007—Apple® today announced that EMI Music’s entire digital catalog of music will be available for purchase DRM-free (without digital rights management) from the iTunes® Store (www.itunes.com) worldwide in May. DRM-free tracks from EMI will be offered at higher quality 256 kbps AAC encoding, resulting in audio quality indistinguishable from the original recording, for just $1.29 per song. In addition, iTunes customers will be able to easily upgrade their entire library of all previously purchased EMI content to the higher quality DRM-free versions for just 30 cents a song. iTunes will continue to offer its entire catalog, currently over five million songs, in the same versions as today—128 kbps AAC encoding with DRM—at the same price of 99 cents per song, alongside DRM-free higher quality versions when available.

“We are going to give iTunes customers a choice—the current versions of our songs for the same 99 cent price, or new DRM-free versions of the same songs with even higher audio quality and the security of interoperability for just 30 cents more,” said Steve Jobs, Apple’s CEO. “We think our customers are going to love this, and we expect to offer more than half of the songs on iTunes in DRM-free versions by the end of this year.”

“EMI and iTunes are once again teaming up to move the digital music industry forward by giving music fans higher quality audio that is virtually indistinguishable from the original recordings, with no usage restrictions on the music they love from their favorite artists,” said Eric Nicoli, CEO of EMI Group.

With DRM-free music from the EMI catalog, iTunes customers will have the ability to download tracks from their favorite EMI artists without any usage restrictions that limit the types of devices or number of computers that purchased songs can be played on. DRM-free songs purchased from the iTunes Store will be encoded in AAC at 256 kbps, twice the current bit rate of 128 kbps, and will play on all iPods, Mac® or Windows computers, Apple TVs and soon iPhones, as well as many other digital music players.

iTunes will also offer customers a simple, one-click option to easily upgrade their entire library of all previously purchased EMI content to the higher quality DRM-free format for 30 cents a song. All EMI music videos will also be available in DRM-free format with no change in price.

The iTunes Store features the world’s largest catalog with over five million songs, 350 television shows and over 400 movies. The iTunes Store has sold over two billion songs, 50 million TV shows and over 1.3 million movies, making it the world’s most popular online music, TV and movie store.

With Apple’s legendary ease of use, pioneering features such as integrated podcasting support, iMix playlist sharing, seamless integration with iPod® and the ability to turn previously purchased songs into completed albums at a reduced price, the iTunes Store is the best way for PC and Mac users to legally discover, purchase and download music and video online.

[Ram]

In UK, the DRM free tracks will be available for £0.99.  DRM tracks are currently available for £0.79.  Apple is under pressure to reduce the price in the UK store as the Americans pay 50p and Europeans pay 67p. 

Here is an extract from a news article

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Back in the latter part of 2004, The Office of Fair Trading (OFT) referred Apple’s iTunes service to the European Commission on grounds that it was over-charging UK customers. This followed a complaint from Which?, a charity that aims to raise awareness of consumer rights, who pointed out that UK’s iTunes customers pay almost 20% more than its neighbours, France and Germany.

Now, according to icWales, Apple will finally be facing a heavy fine for “overcharging.”

“The European Commission (EC) alleges that agreements between Apple and major record companies violate EC Treaty rules banning ‘restrictive business practices.’ The commission has sent a ‘statement of objections’ about online music sales to Apple and the record companies involved.”

Ignoring the recent price increase for DRM-free music, DRM’d 128kbps music available on iTunes through the UK store costs 79p, while the Americans pay 50p and Europeans pay 67p ($0.99 & €0.99).

Because Apple verifies customers’ countries via their card details they can only purchase songs from their country store; according to the EC, “consumers are thus restricted in their choice of where to buy music, and consequently what music is available, and at what price.”

Apple and the record companies involved, said to be Universal, Warner, EMI, and Sony BMG, now have two months to defend themselves or face a fine of up to 10% of their worldwide annual turnover. To give you an idea of how much that is, Apple’s turnover for 2006 was $19.32bn, which means that they could face a fine of up to nearly $2bn, something I’m sure they could live without.

As present Apple’s only response to the complaint and possible lawsuit is that they “always wanted to operate a single, pan-European iTunes store accessible by anyone from any member state, but we were advised by the music labels and publishers that there were certain legal limits to the rights they could grant us.

“We don’t believe Apple did anything to violate EU law. We will continue to work with the EU to resolve this matter.”

Really iTunes or just a case of “Rip-off Britain?"
As many people know, Apple makes very little profit on individual songs sold through iTunes, so there’s a good chance Apple is going to lose out in two ways if they are forced to reduce their prices and cough up the hefty $2bn fine. But is it their fault?

In the UK at the moment, the cheapest album purchase in ASDA (Walmart) costs £10, while the cost in America is around $10. Translated, the Americans actually pay just over £5 an album, which means UK consumers have to fork out an extra £5 for the same set of songs.

While I’m sure the record labels are partly to blame, the real criminal here is the UK government and its 17.5% V.A.T. (Value Added Tax) that forces the record labels into increasing their prices just so they can make a reasonable profit.

So who do you think is to blame here? Are the record labels being greedy? Are they being forced into raising their prices because of the UK government? Or is it Apple who is overcharging UK consumers?

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[hundredstrings]

I personally have no issue with DRM.  The DRM'd songs that I buy from iTunes can easily be copied onto a CD if I need to.  When iTunes & iPod work so well together, what is the need to take the DRM off?  I can play my music anywhere -- on my home computer, office computer, friend's computer (I have shared my iTunes library and have authorized my friend's computer as well), bed room (I have iHome with a docked iPod mini), living room (have another iPod connected to the Bose Lifestyle system), car (I have an in-built FM transmitter connected to my "car iPod", I have yet another iPod in the office, connected to a JBL Creature speaker set...  Absolutely no issue with DRM.  If I didn't have so many iPods, I would have just carried the same iPod around and played the music on each of the above systems...

Anti-DRM seems to be a far cry from the folks who are outside the cozy world of iPod + iTunes...

When we have no issue with the DRM on DVD, why is Fairplay such a big issue?  I don't have any problems buying the same brand of the DVD player -- even if we had such a restriction for playing the DVD -- as long as the player has a reasonable price and it works well!!

[hundredstrings]

Even Amazon jumps into DRM-Free online music game:

16 May 2007

Amazon Confirms Digital Music Store Plans, EMI Jumps Aboard

Amazon officially confirmed its intentions to open a digital music store on Wednesday, a disclosure that largely coincides with earlier information.  Several weeks ago, executives pointed Digital Music News to an MP3-based destination, one that will launch with or without major label support.  That protection-free agenda was reaffirmed by the official Amazon announcement.  "Every song and album in the Amazon.com digital music store will be available exclusively in the MP3 format without digital rights management (DRM) software," the company stated.  "Amazon's DRM-free MP3s will free customers to play their music on virtually any of their personal devices — including PCs, Macs, iPods, Zunes, Zens — and to burn songs to CDs for personal use."  The etailing giant pointed a vague launch date of "later this year," an expanded window that offers more licensing time to holdout labels.

Jumping on board immediately is EMI, which signaled its involvement alongside the broader announcement.  The major will offer its entire catalog DRM-free, and tracks will carry higher fidelity levels than conventional, DRM-protected tracks.  EMI did not offer details on its pricing plan, though it appears that its downloads will carry an elevated, $1.29 tag.  EMI is the first major to join the Amazon play, part of a larger DRM-free initiative.  Earlier, the company announced a DRM-free deal involving iTunes, though it remains unclear if the pair will launch this month as planned.  EMI is one of 12,000 labels joining the Amazon push, a critical mass that will exert continued pressure on remaining majors to reconsider protection-based strategies.  "Our MP3-only strategy means all the music that customers buy on Amazon is always DRM-free and plays on any device," said Jeff Bezos, founder and chief executive of Amazon.  "We're excited to have EMI joining us in this effort and look forward to offering our customers MP3s from amazing artists like Coldplay, Norah Jones and Joss Stone."