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?

[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?

[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.

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.

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.

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.

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: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.