Jobs to Labels- Lose the DRM & We'll Talk Price

eldavojohn writes "Apple CEO Steve Jobs has been talking smack about DRM and has recently issued a verbal offer to major music lables stating that if they are willing to lose the DRM, he'd be willing to raise his 99 cent price for those iTunes songs. These tracks (such as the recent EMI deal) would also have better sound quality & cost about 30 cents more."

Comments

Are consumers that dumb?

[seanadams.com]

While on the one hand it is nice to see this pressure to get rid of DRM for "purchased" tracks, it is pretty disappointing to see that the move will also come with an increase in price. They gave us something we didn't want in the first place, and now they're using the taking away of it to justify a higher price? WTF?

This is just a continuation of the trend towards higher prices for music, in spite of plummeting costs for media and distribution. Wax cylinders -> Lps -> tapes -> Cds -> downloads - it just gets easier to move the data, but the price never goes down!

Re:Are consumers that dumb?

[jimstapleton]

actually, from TFS, not just TFA, the higher prices will also come with higher quality audio.

No DRM + higher quality audio = possibly worth a 30% increase in price

Re:Are consumers that dumb?

[neoform]

two things:

A) He needs to entice them to move forward with technology since the various RIAA labels are clearly run by dinosaurs.

B) Want to point out when in the past century you could buy a single song (without DRM) for $1.29 (keeping inflation in mind)?

Re:Are consumers that dumb?

[Anonymous Brave Guy]

They gave us something we didn't want in the first place, and now they're using the taking away of it to justify a higher price? WTF?

They're giving you something you do want at a (higher) price they think it's worth. The lower price you never paid for something you didn't want is irrelevant.

Re:Are consumers that dumb?

[Stamen]

Love or hate Apple, at least they are using their current power to apply pressure in the right direction; no DRM. I don't mind the increase in price as much, because eventually they will increase it anyways based on inflation; so the bone Jobs is throwing them isn't very valuable, but he'll sell it like it is.

I hate monopolies, personally, but in this case it takes Apple's virtual monopoly in this space to fight the other monopolies (I know they are really a group of companies controlling everything, but you understand what I'm saying) in the media space. So I'll stand next to Apple on this one; for the time being.

Re:Are consumers that dumb?

[garcia]

No DRM + higher quality audio = possibly worth a 30% increase in price

And yet CDs, which are DRM free, have the highest quality audio and will cost about the same, offer a physical medium, and packaging as opposed to what will be available online.

Re:Are consumers that dumb?

[Lockejaw]

Some of this crap isn't even worth $0.99. I get the higher quality encoding and dumping the DRM, but why pay a higher price?

Because, unlike when you buy a CD, you can just pick the good tracks and not pay for the crap.

Re:Are consumers that dumb?

[Kandenshi]

CDs force you to buy all 10/15/20 tracks though. I don't mind paying (CD price) / ( # of tracks) for an individual song assuming the other factors are constant or close to it. I like being able to pick these 6 songs and ignore the rest.

The physical medium is pretty worthless to me. Maybe even negative value since they create more waste and pollution than an additional file download does.

There are occasions where the packaging is nice, but not very often for me. Most of it's just sitting in the garbage or in a drawer where I'd tossed all my CD cases. How much more would you be willing to pay on every CD for the inserts and such? 50 cents? $1.50?

Re:Are consumers that dumb?

[pla]

in this case it takes Apple's virtual monopoly in this space to fight the other monopolies (I know they are really a group of companies controlling everything, but you understand what I'm saying) in the media space.

You want the word "monopsony" rather than "monopoly", in the sense you used it (a single buyer, or in this case broker, exerting pressure on sellers).

Re:Are consumers that dumb?

[Lumpy]

There is NO drm on the music on the Audio CD that can legally be called a Audio CD.

there are half-assed attempts to make a PC not read them, which are in fact NOT DRM.

So the OP is actually right, you are the one that is mistaken.

And I agree with him, I'll pay less for far higher quality on CD without paying anything to the RIAA.

I buy all Cd's used :-) and it upsets the RIAA more than the pirates.

Re:Are consumers that dumb?

[Dogtanian]

I could buy whole albums in the 99 cent bin at the local music store. Mmm... yeah. Cheesy compilations of disco songs that have been "re-recorded to maintain quality [to save money more like, save me the weasel-ish excuse] by as many of the original group as possible", and a few obscure (reached #47 in 1986) non-hits!

Re:Are consumers that dumb?

[glas_gow]

Cd Audio is sampled at 44100 Hz, at 16 bits per sample. While sampling at a higher rate and bit depth than that will improve on the quality, the average pair of 25 year old ears will not be able to hear the difference.

Most recording studios these days use, at the very least, 24bit audio at between 96-196+ khz. While I agree with you that most people won't hear a difference, audiophiles will hear a difference. My mother can't tell the difference between a hissy cassette tape and a CD, but that doesn't mean there isn't one.

The interesting point here is that online music sales could potentially supply consumers with higher quality audio than currently is available with CD. Changing the way CD's play audio would take years. Whereas many people already have good quality sound cards capable of delivering higher quality audio.

The obstacle is obviously file sharing. People sharing sub-CD quality audio is one thing, having them sharing studio-master audio is a completely different thing.

Jobs is playing the PR game, trying to unalign Apple from DRM. That said, any move away from DRM, PR motivated or not, is to be lauded.

Re:Are consumers that dumb?

[Rei]

You can still improve, though, without using any more space. Sample at a faster rate and using more bits, then use standard audio compression methods to drop the least audible frequency components. Same file size, better quality. Basically, you're choosing that you want *all* frequencies up to 22,500 hz, *nothing* more than that, and all frequencies stored with equal bit resolution. By going with audio compression, you can avoid being so artificially limited; your algorithm can pick out the most important components to store.

The 44,100 hz/16 bit sampling rate isn't bad. It's just not optimal.

Re:Are consumers that dumb?

[Archangel Michael]

Apple doesn't have a "Monopoly" in any sense of the word. They have a complete vertical market solution, which is not the same as monopoly. You are free to choose other market options that are reasonably close facsimile of what Apple produces, but you'll be giving up the virtually seamless integration by doing so.

Apple's iPod and iTunes both handle two INDUSTRY standards for encoding, and ONE proprietary DRM feature, a DRM feature they (via Jobs) are trying to remove.

I never got the gripe of you Anti-Apple whiners. Go, use Rio, or Zune, or whatever else is out there for playing MP3s and WMA (proprietary format) nobody is holding a gun to your head. Go, Use allofMP3 and any other source for Downloading Music. Hopefully you don't have to be a technical genius to get it all to work right, because if you do, then you're obviously missing the point of iTunes, iPod, iTMS and the whole integration thing. It Just Works (TM).

I gave my wife an iPod last year for her birthday, she didn't even know what it was! The she picked up and used it, and started Ripping her CDs to the iPod right away. It just works for her, and it is "easy" for her. Which is the whole point, isn't it? Point Click Rip Sync.

We got it hooked into the car, the iHome in the kitchen, the Main Whole House Stereo system, because "It Just Works(TM)".

If you want to call that a Monopoly, fine, go ahead. I call it building a better mousetrap, and Apple has done a great job in making a Music Player Experience that is pleasant. Sorry if it doesn't support Ogg or Linux or whatever else you think it ought to. It does support MP3 and ACC, both open formats, and can rip, burn CDs quickly and easily, and support from many third party add-ons, and works both on Mac and Windows.

So, I don't know what the beef is all about. It isn't the monopoly you think it is.

Re:Are consumers that dumb?

[suv4x4]

Most recording studios these days use, at the very least, 24bit audio at between 96-196+ khz. While I agree with you that most people won't hear a difference, audiophiles will hear a difference. My mother can't tell the difference between a hissy cassette tape and a CD, but that doesn't mean there isn't one.

Recording studios don't do 24bit 196kHz because they "hear a difference". They do it for the same purpose that Photoshop (for ex.) supports 48-bit images: when you're going to edit this material (filter, change dynamics, amplify, process, speed up/down, remix etc etc), you need extra precision, since from all the twisting and processing, deffects on a 44khz/16-bit piece start to show much sooner than with 24-bit 196kHz.

For studios, the flexibility to tweak the material endlessly without perceptible loss is important, since recording in a proper isolated room with all the proper technicians, musicians, singers, equipment, isn't cheap (cheaper than before, but not cheap).

Audophiles are in the majority losers who can be convinced that 900kHz sounds much better than 800kHz, even if you actually played the same thing to them, but with two different labels. Quality at those levels is subjective, and people's senses are unwillingly manipulated by what they're told.

It's basically the same reason why some people admire paintings like this one. they don't all pretend they understand/like it.

Some are convinced they see something incredible, maybe the author is also convinced he thought of something incredible, thing is, I can put my 5 year old kid and it'll draw the same in 2 minutes and they won't be able to tell the difference and admire just the same.

Re:Are consumers that dumb?

[d34thm0nk3y]

Microsoft doesn't have a "Monopoly" in any sense of the word. They have a complete vertical market solution, which is not the same as monopoly. You are free to choose other market options that are reasonably close facsimile of what Microsoft produces, but you'll be giving up the virtually seamless integration by doing so.

Microsoft's Internet Explorer, MS Offfice and Windows handle many INDUSTRY standards, and ONE proprietary data format (*.doc).

I never got the gripe of you Anti-Microsoft whiners. Go, use Apple, or Linux, or whatever else is out there for operating your computer, nobody is holding a gun to your head. Go, Use Firefox, Open Office and any other source for editing documents and surfing the web. Hopefully you don't have to be a technical genius to get it all to work right, because if you do, then you're obviously missing the point of Windows, IE, Office and the whole integration thing. It Just Works (TM).

I gave my wife Windows last year for her birthday, she didn't even know what it was! The she picked up and used it, and started Surfing the web and editing documents right away. It just works for her, and it is "easy" for her. Which is the whole point, isn't it?

We got it hooked into the Media Center in the kitchen, the Main Whole House Stereo system, because "It Just Works(TM)".

If you want to call that a Monopoly, fine, go ahead. I call it building a better mousetrap, and Microsoft has done a great job in making an Operating System Experience that is pleasant. Sorry if it doesn't support Ogg or Linux or whatever else you think it ought to. It does support MP3 and ACC, both open formats, and can rip, burn CDs quickly and easily, and support from many third party add-ons, and IE and Office works both on Mac and Windows.

So, I don't know what the beef is all about. It isn't the monopoly you think it is.

Re:Are consumers that dumb?

[Kjella]

While I agree with you that most people won't hear a difference, audiophiles will believe they hear a difference.

There, fixed that for you. I've read double-blind studies all the way back to c't in 2000, which said that twelve audiophiles and one sound master at a record company couldn't tell CDs and 256kbps MP3s apart. english / german. Let me quote from the summary:

In plain language, this means that our musically trained test listeners could reliably distinguish the poorer quality MP3s at 128 kbps quite accurately from either of the other higher-quality samples. But when deciding between 256 kbps encoded MP3s and the original CD, no difference could be determined, on average, for all the pieces. The testers took the 256 kbps samples for the CD just as often as they took the original CD samples themselves.
(...)
This article will not end the ongoing debate of whether the use of MP3 compression is a reasonable or unreasonable procedure. Audiophile fans that concern themselves with brand names and are status conscious will never listen to MP3s, no matter how many tests may prove that the sound experience is equivalent in both cases. Skeptics (They are all sissies at ct; I would certainly have heard the difference) should get encoders and CD burners and then submit themselves perhaps even using the same pieces and under similar conditions to their own Pepsi-Test.

Re:Are consumers that dumb?

[FiloEleven]

As someone else pointed out; CDs usually come with 7/10 tracks that aren't worth listening to. Good lord! What kind of shitty music are we talking about here? What kind of band has so little self-respect as to put seven filler tracks on an album?

So if you like the full CD, buy it. But if you like that one song on the radio-- Aah, that explains it. ;)

On a more serious note, track-by-track purchases are a good thing for the music market. Bands who fill their discs with junk and rely on their hit single to sell records will no longer be able to get away with it. I think that means we'll see some talented acts picking up the spotlight instead of the industry-created fluff of recent years. I just hope that artists don't abandon the idea of the album as a cohesive whole - when you're in the mood for something a little deeper than top 40, nothing beats putting on a well-executed musical journey from one of your favorite bands.

No DRM cool, higher price not so much.

[dcskier]

Can we still have the option of DRM w/ the lower price? I'm all for getting rid of the DRM on iTunes, but not for the expense of another $.30 a song. Plus the sound quality is fine for me right now, I'm not a audiophile and I'm sure those who are weren't using iTunes in the first place. This just kinda feels like when the cable company adds new features or channels and then feels free to raise your rates since they're making 'improvements' to your service that you didn't ask for.

I thank Jobs for a step in the right direction, but it still has strings attached. Why should I have to pay a premium to own my music, errrr sorry I meant the RIAA's music.

Re:Defeats the point

[Echnin]

...Except albums are still $9.99 without DRM and at the higher bitrate.

No!

[n6kuy]

The labels have already loosed the DRM.

We want them to lose the DRM.

Attribution?

[Infonaut]

How do we know Jobs verbally stated that he'd drop the 99 cent pricing restriction? There's no attribution in the article to such a statement. Is this from an anonymous source? Was the writer there when the statement was made? The AP usually does better than this.

Re:Nice, but...

[geek]

You do know Apple is still charging the same 9.99$ for the whole album right? They only increased the per song price. The songs also come with the album art embeded in the file. You aren't paying more, period. You also get the convieniance of buying online and getting immediate delivery.

Re:So... *More* than buying a CD?

[geek]

If you buy the whole album, even if it has 20 tracks, it's $9.99. Please do a little research before spreading this FUD.

Jobs, where are Disney's DRM-free movies?

[I'm Don Giovanni]

Jobs is the single largest shareholder in Disney, and he goes on and on about DRM-free music, but doesn't push for Disney to release its movies on unprotcted DVDs, HD-DVDs, and/or BRs, nor DRM-free online web releases. When asked about it, he hemmed and hawed, "Um, well, you see, video is different than audio...". Bull. Jobs, stop grandstanding about music and start releasing your own company's movies in unprotected fashion. THEN you'll have some credibility on this issue.

Re:Jobs, where are Disney's DRM-free movies?

[tm2b]

Oh my fucking god, you people are unbelievable.

A couple of months ago when he published his DRM views, it was "yeah, right. Until you start selling DRM-free tunes on iTunes, you have no credibility." Now, it's "gimme DRM-free Video from a public company where you're a tiny (a few percent) shareholder, NOW!"

What the hell is it with you people? He's used his influence and control (which everybody constantly complains about) to engineer the largest single rollback of existing DRM in history - can you see Bill Gates doing that? Cut him some fucking slack.

ringtones anyone?

[Anonymous Coward]

Sure, $1.30 might seem like a lot, but consider the thriving ringtone market, where people spend $2+ for retarded 30 second clips of fergie or whoever, that have ultra-crappy quality, and can't even be listened to anywhere besides a tiny cellphone speaker!

These songs will sell fine.

Re:Here are some figures

[shawnce]

The "30%" only applies to song purchase. Album purchases haven't changed in price when buying 256kbps sans DRM.

Lose vs Loose

[mad.frog]

How did you manage to get this right in the headline and STILL get it wrong in the summary?

Geez!

Re:Lose vs Loose

[g0at]

And "lables"? What the hell is a lable?

Salsdhot: Folklore edtied by ilitterates.

b

Sounds great.

[jshriverWVU]

A year ago, people were arguing "why should I pay $15-$20 for a Cd when I only want 1-2 songs, because musicians suck now adays only have 1-2 good songs" so iTunes starts up. You can buy that one or two songs and save the "crappy filler songs tax". People were happy but didnt like the DRM (which I agree with). So not they're removing the DRM, increasing the quality of the encoding and only adding $0.30 to it. Now people are crying "why should I pay $0.30 more when I can buy the CD for less".... *shakes head* if you want a complete CD then buy the CD, if you want 1-2 songs buy it online. I'm not flaming it's just a perfect example of you can't always make everyone happy. For me this sounds great. When an artist I really like comes out, I grab the CD at a local store, if it's a one hit wonder I hear on the radio, I'll buy the one song online. How is this not a good thing? No this isn't a flame, just frustrated when people ask for things, get it, then complain against their own argument.

Soundbite society

[dazedNconfuzed]

Gotta like how someone participating in a soundbite-oriented society (/.) will criticize another for not writing a comprehensive tome detailing the limits and degrees of a statement which is, for 99% of purposes of discussion, true in just a few words.

OF COURSE some CDs have DRM. MOST DON'T. This in contrast to the subject at hand, being songs downloaded from iTunes, which practically all DO have DRM.

Re:Soundbite society

[Just Some Guy]

OF COURSE some CDs have DRM.

OF COURSE no Compact Disc Digital Audio disks have DRM. There are a few non-audio discs that contain some audio information that may be so infected, but it's impossible for a CDDA disc to be ruined that way.

A/V heading in opposite directions?

[HockeyPuck]

Has anybody noticed that for the general public, audio and video quality is heading in opposite directions? Head down to your local "big box store" and you'll see that they're pushing products that have superior VIDEO quality:

digital/satellite cable, HDTV, LCD/plasma screens with 1080i/p.

However, when it comes to audio, the sources for audio (mp3s for the majority) are worse quality now, then at any other point. Records, tapes, even plain old CDs have better quality than some down sampled mp3.

Are we getting complacent with our audio quality? Or is it just that the jump to HDTV from non-HDTV video is so great that it's an easy sell? Walk over to the AudioDVD/SACD section and you'll see almost nothing. Companies push for you to buy a $2000 stereo system, and then feed it with 128kbps mp3s...

Re:A/V heading in opposite directions?

[ThousandStars]

Audio has reached the point at which most people can't hear the superior quality. If you can't tell, does it matter? Video hasn't reached that point and still has a long way to go. Even so, I wouldn't be surprised if it takes a while for next-gen video formats to take off because the improvement they offer over DVD is relatively less than DVD offered over VHS.

You haven't seen much improvement in book tech over the last 100 years, and those improvements have been incremental. The same thing is happening to audio and video; once you've made things as nice as people can perceive, there isn't much more to be done.

Re:So... *More* than buying a CD?

[SnowDog74]

You say: An album worth of tracks on iTunes cost more than a full price new release.
I say: Buy the album at the album price, not the tracks individually. Whether there are one track or twenty five on it, it will cost you less than the CD.

You say: iTunes will not let you mix and match an album worth of tracks for the price of an album.
I say: No one else will. Not Amazon. Not Best Buy. Nobody.

Oh, and by the way... if you already bought a couple tracks of an album and want to complete the album, iTunes will let you grab the rest of the album for the album price less the money you already paid toward the tracks you already have... even THOUGH as a portion of a full album the per track price is less than 99 cents, they're still letting you apply what you have paid thus far to an album price, rather than a prorated per-track album completion price. The same model will likely apply when the per track price is $1.30 and the album prices are still $9.99 even for the higher fidelity (as Apple has stated they plan to do).

Care to identify a single music retailer other than Apple who will do this?

The problem in your assumptions is that you think that the entire price of a product is associated only with the tangible materials that went into it. As if there are no other people to be paid other than those who work at the manufacturing plant, and as if there's no inherent market value to the INTANGIBLE content... (i.e. lyrics, music) in a musical work, and as if there are no costs to maintaining data centers with global load balancing that can serve millions of customers worldwide without crashing to a grinding halt.

Also, you're saying it starts to look worse and worse for individual singles. Do you remember when a single cost $1.49 to $3.49 just to buy it on a crappy analog cassette? I sure as hell do... and then you could only buy the singles that the studio released AS singles. You had no option of buying almost any track off an album, much less digital. It has only gotten better.

There is also a premium associated with the convenience of the iTunes model. Amazon will charge you shipping unless you want to wait an indefinite period for their SuperSaver shipping by which time you could have downloaded many times that amount of content from iTunes. Your time is worth money... how much? That's open to debate depending on the individual but I would imagine it's no fun to wait days on end just to get that one song you wanted... and when you do, Amazon won't let you have just that one song. It's got to be the entire album... one song you want, and a bunch you might not.

There is no direct analogy between what Amazon offers in terms of product and service, versus what Apple offers. And you are overlooking a very important competitive edge here because the ability to mix and match whatever tracks you want at a fair market price is one of the key attributes that makes iTunes so much more convenient and consequently hugely popular and still increasing in popularity.

The Apple business model can command a premium for the non-DRM tracks because of the limited alternatives to having their a-la carte purchasing options and the convenience of their user interface, search capabilities and purchasing system.

Re:Where are the EMI songs?

[TheRaven64]

According to every press release and article about them, they will be appearing 'in May.' The end of May has not been reached yet, so you may have to wait for up to three more weeks.

Free markets people, it's not rocketscience

[dk.r*nger]

With DRM, iTunes has a defacto monopoly on legal online musictrade. Not only that, it's tied to the iPod.

When labels open up and start making their catalogs available in non-DRM versions, the barrier of entry to the business will drop significantly, since a music store will no longer need to own a hardwareplatform and maintain a quirky DRM system. This will create more actors on the marketplace, and the price will drop. At first the price will be $1.29, but soon someplace will come along and sell the tracks at $1.20, maybe even $.99. That will force Apple to match this, and in turn, there will be pressure on the labels to lower thier prices.

Jobs doesn't mind that - because he know that he owns the Walmart of musicplayers. Your one stop shop for anything that makes a sound. Therefore he will get the volume, everybody else will just be the long tail. It's much easier for him to be in the front of non-drm music, than to play catch-up after some bored european "consumer"(*)-organisations forces non-drm.

(*) They're all government-run, so it's not like consumers get to decide how, when or if they will be represented.