2008 really is proving to be the year that we finally lose DRM – in music at least! Earlier this week Sky announced that it had done a deal with Universal to be part of its forthcoming music subscription service. Seemingly, for a monthly fee, subscribers will be able to stream what they like and download a set number of DRM-free tracks. It’s an interesting proposition and I think that the really important part is the "DRM-free" part.
We’ve reached a point where consumers know that when they download music it’s not just going to be for their iPod. Their mobile also plays mp3s, as does their Xbox, their SatNav, their LCD picture frame, their PSP and of course their PC. In the same way that when I buy a CD, I know it’ll work in a number of devices and I can quite readily convert it into a format that works in more devices, consumers expect their music to work beyond their iPods.
It’s no accident that Play.com launched its music download service with mp3s, and Amazon’s forthcoming UK download service will also be mp3 based. eMusic has been around for a number of years solely offering mp3s, and Random House now allows mp3s of its audiobooks to be sold via various suppliers. Naxos offers its music and audiobooks as mp3s, as does Deutsche Gramaphone with its classical music offering. Even Apple has finally got on board offering a so far limited range of tracks in a DRM-free format.
It’s interesting that Universal has taken an equity stake in Sky’s new service. Sky will undoubtedly be looking to sign up the other major labels before launching, but the labels realise that they need to try different things and no end up beholden to Apple’s iTunes store where it sets the price and the rules.
The reality is that physical music sales are falling, and the shortfall is not so far being made up by digital downloads. iTunes maybe the biggest source of music in the US, overtaking Wallmart, but that’s not enough.
Where does this leave non-Apple, DRM’d tracks, and by that I mean the only real alternative DRM system – Windows Media? Not in a great shape to be honest. While there is a wide variety of music players available that support the WMA format, combined they make up only a fraction of mp3 player market share. These businesses to work hard and fast to turn themselves into DRM-free services. That’s all but impossible for those that offer unlimited download rentals while a monthly subscription fee is paid, but that’s only part of the market. Apple is always rumoured to be offering a similar service, and I wouldn’t be surprised if they launched a subscription scheme at some point in the near future with full downloads as part of that offering.
In the end, DRM really doesn’t work anyway. It simply works to infuriate people who’ve legitimately purchased music and then find themselves having to dig out weird and strange workarounds to get their music to play on the players they want to hear it. And it does nothing to stop piracy. Are kids still going to trading CDs packed with mp3s in the playground? You bet they are. Will torrent sites continue to exist full of new and old releases? Yes. The industry needs to work at other methods to stop that (Although it’s instructive that even Feargal Sharkey of the BPI admitted recently that he traded cassettes at school and recorded the top 40 off the radio. Somehow the CD equivalent is different).
One short coda: DRM can and still does work for movie and television downloads. There’s no real demand for the iTunes store to offer its video offerings on a DRM-free basis yet. But the keyword there is "yet."