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Does DRM Enable Online Music Innovation?

chia_monkey writes "An article at the Tech Law Forum asks the question 'Does DRM Enable Online Music Innovation?'. The piece looks 'at the range of legitimate online music distributors to see just how much the presence or lack of DRM affected business models.' It's a rather interesting read as the author breaks down seven online music stores (iTunes, Napster, Yahoo! Music, Zune, eMusic, Amie Street, and Magnatune...four of which use DRM and three that don't). The article mainly focuses on the ownership and 'renting' of the music (which can be seen with the 'buy the condo downtown' and 'rent a mansion in the slums' analogies) and how it applies to innovation and perceived business models. The numbers don't lie ... price-per-download is the clean winner while DRM-based models also take the lead. Will the market shift toward subscription based models in the future? Or, will DRM go the way of the dodo bird (as Steve Jobs has already proclaimed his preference for)?"

6 of 129 comments (clear)

  1. Missing a critical element of the business model by jfengel · · Score: 5, Insightful

    There is a huge difference between the various services that the article does not take into account: mass marketing of the underlying music.

    The companies that want DRM on their music are the ones that they spend a lot of money making popular. Their business model is to get a lot of people aware of certain songs, and then sell the song to each of them individually. That's the RIAA's model.

    The independent labels don't have a huge marketing budget, and so they care a lot less about whether they get paid for each individual download. For them, passing songs between people really is free advertising.

    So the success of any individual music store has more to do with how effective they are at getting you to find the music you want than with the DRM. iTMS sells a lot of the RIAA's music, which the labels spend megabucks marketing (an investment they want to protect). eMusic sells songs that aren't heavily marketed.

    There are a few performers who straddle the line, who got famous on the RIAA's dime and then managed to extricate themselves. They get the best of both worlds: a huge audience without the need to make each individual download pay. But these are the exceptions, not the rule; don't forget how they got famous in the first place.

    That's the key here: promotion. It's way more important to most people's music choices than nearly anything else.

  2. No allofmp3.com? by Anonymous Coward · · Score: 4, Insightful

    ...price-per-download is the clean winner while DRM-based models also take the lead [in profit].

    The fact that they decided not to include allofmp3.com in the "study" should give you a hint regarding how objective this "study" is.

    Personally, I think allofmp3.com is the best of them all.
  3. Oxymoron by SatanicPuppy · · Score: 5, Insightful

    DRM doesn't enable anything...All it does is restrict. So how can it possibly enable innovation? What would happen if there was no drm? Would music stagnate? Doesn't seem to have in the past.

    I believe in limited copyrights to protect an artists ability to profit from his works. I don't believe those copyright should be transferable to corporations. I don't believe those copyrights should have anywhere near the duration that they currently enjoy, and I don't believe I'll pay a damn dime for drm encumbered crap that does nothing more than deprive me of rights that I should have by virtue of paying for the damn content...At least if I stole it, someone would have taken off the damn drm!

    Innovate that.

    --
    ad logicam Claiming a proposition is false because it was presented as the conclusion of a fallacious argument.
    1. Re:Oxymoron by jfengel · · Score: 3, Insightful

      Music used to be heavily restricted. You bought an LP/cassette/8-track and you couldn't back it up, make extracts from it, mash it up with anything, or do much except play it on the device for which you bought it. You could try to make a copy, but you were going to suffer extreme quality loss and after only a couple of generations it would be unlistenable. The Rights Management wasn't Digital but it sure was Restrictive.

      It's only since the creation of the CD that you could do any of those things. The old model has to go out the window; people like the stuff that they can do with the new format. But it's not clear where to go from there, since free copying tends to encourage exactly one pricing model: give it away. It may be the only model, given how ineffective DRM is compared to the old "press it into vinyl" model.

  4. Re:Yes by garcia · · Score: 5, Insightful

    Ack. You have fallen for the conglomerates' campaign. You are now officially brainwashed into thinking that DRM is "good".

    DRM exists for the benefit of the distributors and not the artists as they so readily claim. Why do the various distribution schemes out there have to have DRM in order to be viable? For some reason allofmp3.com worked just fucking fine for everyone (streaming and/or downloading) without the DRM. For me, it worked even better because I could get them in various bitrates and/or FLAC/WAV if I saw fit (and I did at times).

    We need to REJECT at every turn the conglomerates' suggestions that we should bow to their demands. They are businessmen and they will respond favorably when the populace stops giving the fuckers money. It's people like you (and nearly everyone else) that makes DRM laden music viable.

    Me? I'll stick to what is best... Music that is freely distributable by bands that don't make their money by sitting in a studio for one album but instead are out there working their asses off touring. I'm planning on going to see 5 shows in the next few weeks (it's what I can afford right now) and they are all bands that I would support.

    That's what everyone should be doing to "give the artists the money they deserve", not paying the RIAA thieves so that the artists can gain a few pennies after a lower quality DRMd download.

  5. Yes for rent, no for purchase by dupont54 · · Score: 3, Insightful

    I agree with you : I haven't problems with DRM being part of a "renting" or "access to a catalogue" business model, where you pay a monthly fee. Because in this case, if you are not happy with the DRM, you can stop paying and that's the end of the story. So the provider must do its best to keep you happy.

    But like the vast majority of people, I am not interested in these business models. I still like to buy things, build a collection, ... I prefer the classic "buy once for all" business model. And in this model, DRM are completly inacceptable.

    There is not such thing as "BUYING" a DRMed media, those things are just too volatile : change your hard-drive/OS/players too much time and your file self-destroy ; providers can go bankrupt with their activation servers ; buy new hardware which happened to be incompatible with non-standard DRM techniques, have your player key revoked because some hackers found it, etc... And of course, if the DRM is efficient, you cannot make backup or "interoperable" copy. So sooner or later, your media is broken for no reason and you can't do anything about it...

    You cannot buy a DRMed media, you are renting it ; the provider just forgot to tell you for how long... And if you are not happy with the DRM, too late, you have already paid. I suppose that's qualify as a business "innovation".