A bigger piece of Apple's pie
The first crack has appeared in the DRM (Digital Rights Management) armor hastily thrown on by the entertainment industry to fight the unseen dragons of piracy. EMI and Apple announced yesterday that most of their catalog already released digitally will be available on iTunes without DRM protection. This does not include The Beatles.
Granted that this experiment may fail. EMI may not see any measurable gain from it and drop the experiment. Or they mail see billions of copies of their music on piracy sites and rethink their decision. Other music publishers may see this as an aberration and not jump on the bandwagon, rendering the EMI decision a business quirk and not a trend. Apple may decide that they don't like it either. After all, DRM protects them more than the music companies, in some ways. Music purchased from iTunes cannot be played on other players because of the DRM scheme.
Yet, lets look at the big picture; the company and Apple split a bigger pie. DRM-free music will be $1.29, not $.99 per song and I predict that there will be no price resistance from consumers to paying it. Apple continues to establish its industry dominance by showing that they can crack the whip and get everyone to jump. If this works, then they're the ones to break DRM's back. The consumer clearly benefits because Apple will be providing higher quality music for downloading and of course, because there will be no DRM encoding.
If Apple's efforts are successful and that can be judged by watching to see if other music companies join in, then they own the digital music industry for years to come. This also sets the stage for the importance of Apple's iTV box, because they will eventually try to do the same thing in Hollywood.
Posted on April 03, 2007
