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Sony BMG Dropping DRM 295

Lally Singh writes "BusinessWeek is reporting that Sony BMG is planning on dropping DRM from their music. Salon's Machinest had an interesting take on this; 'Actually, what's happened is quite ironic. It was the industry's own DRM mandates that tied many music-lovers in to Apple's music storefront (we all had iPods, and the only way to buy digital music for the iPod was from Apple). Now Apple's become too powerful for the labels. They need an alternative distribution channel — they want to get music to our iPods, but they don't want to go through Apple to do it. The only way to do that is to offer retailers like Amazon the chance to sell songs as plain, unrestricted MP3s, which are iPoddable.'"
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Sony BMG Dropping DRM

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  • by yagu ( 721525 ) * <yayagu@[ ]il.com ['gma' in gap]> on Friday January 04, 2008 @05:39PM (#21915270) Journal

    This should be a nice switch, I've already been purchasing from amazon's mp3 store and find the ergonomics, the quality, and price all to my liking. And, if I find something I really like I purchase the real deal, the CD. I for one welcome our former DRM overlords into the fold.

    This only widens and expands the music industry's audience, it is the logical conclusion to a stupid experiment. I suspect there are other efforts in the works to try and keep a grip on their "property", but this is yet another death knell to the music industry as they (the execs, etc) know/knew it. Wait until some breakthrough artist figures out they no longer need to be beholden to the record labels for their livelihoods.

    Now, if only we could see some of this sanity become contagious and spread into some of the other media. DRM is a pain and it's ineffective. Just 2 days ago I watched on DVD a movie still only in theater-release -- I won't say where (it wasn't at my house), and I won't say who (it wasn't someone I knew). I would never do this, but it's obvious DRM only makes life more difficult for the honest consumers. (Wasn't there an article recently here about someone's collection of media getting wrapped around the DRM axle because he bought a nice new monitor on which to watch his movies?)

    • by LWATCDR ( 28044 ) on Friday January 04, 2008 @05:44PM (#21915386) Homepage Journal
      So when will the drop DRM for video? When will I be able to rip a DVD in iTunes and put it on my iPod?
      One step at a time. This is a good step but not the last I hope.
      • Re: (Score:3, Informative)

        rumor has it, iTunes will support DVD ripping (for 20th century FOX movies) as part of the FOX movie rental deal. It might be announced at MacWorld later this month.
        • If it can decrypt CSS for 20th Century FOX DVDs, wouldn't it be able to do it for any other producer?
          • Re: (Score:3, Informative)

            by Sancho ( 17056 )
            More likely, Fox will include "iTunes" versions of movies on their DVDs which can be imported. They'll probably use the same encryption that downloaded movies use to prevent them from being used in a non-authorized manner.
    • Re: (Score:2, Insightful)

      by Anonymous Coward
      They had to do this. Working with MP3 files are so simple that anything with DRM is a hassle to work with. When its alo more work to pay for stuff that gives you problems, the simpe to use and free stuff is way to tempting.

      http://stld52.blogspot.com/2008/01/drm.html [blogspot.com]
    • by sm62704 ( 957197 ) on Friday January 04, 2008 @05:54PM (#21915578) Journal
      I would never do this

      I would. I have no problem whatever making life miserable for thieves and miscreants like those bastards who run the entertainment industries.

      "The VCR is to Hollywood what Jack The Ripper was to women" -Jack Valenti, head of the MPAA when he made that stupid comment.

      Fuck 'em all. When they start running respectable businesses I'l respect their businesses.
      • by Nerdposeur ( 910128 ) on Friday January 04, 2008 @06:35PM (#21916228) Journal

        I have no problem whatever making life miserable for thieves and miscreants like those bastards who run the entertainment industries.

        In context, I presume you mean pirating their work. Without getting into a moral argument, I do think you should consider the practical effects of your behavior.

        We all know that labels screw artists and DRM is bad and blah blah blah, but what happens if your favorite action films cost $50 million to make, but suddenly all of the customers have "digital content wants to be free" philosophies?

        Frankly, if nobody pays to see movies, no movies will get made - or at least, only cheap movies where the person making them can afford to eat the cost. No more magical Hollywood special effects. You're not going to see Lord of the Rings get produced under a Creative Commons license.

        Even if the whole business isn't "respectable" by your standards, you obviously respect their work enough to watch it. To never pay is to vote for a world where that work is never produced.

        • Re: (Score:3, Insightful)

          Even if the whole business isn't "respectable" by your standards, you obviously respect their work enough to watch it. To never pay is to vote for a world where that work is never produced.

          It's a shame my mod points just expired, or you'd have had one.

          It's about time a few people around here realised the hypocrisy of advocating piracy as a counter-strategy to DRM. If you don't like the way the material is offered, fine, vote with your wallet and tell people why. That's your right. But watching the films and listening to the music anyway just says you want the stuff but aren't willing to pay for it like everyone else.

          • by Sancho ( 17056 ) on Friday January 04, 2008 @07:48PM (#21916908) Homepage

            But watching the films and listening to the music anyway just says you want the stuff but aren't willing to pay for it like everyone else.
            Well...yeah.

            Here's the thing: copyright is a balance between the insanity of allowing ideas to be owned, and the insanity of few people creating art because we need to eat. To maintain that balance, the government (the people) struck a deal with content creators--they get a limited monopoly on their work in exchange for creating it in the first place. But eventually, the people get the work, as they should, because owning ideas is idiotic.

            Unfortunately, the content creators don't feel the need to honor the deal--they just want to own the ideas outright, forever and ever. I don't particularly blame them--everyone's always looking out for number 1--but the fact remains that they're violating it every time they ask for extensions.

            It's not unreasonabe to wonder why one side should agree to a deal that the other side is violating.

            The key is that it has nothing to do with the content. A boycott is generally useful for when you don't like what someone is saying, or even how they're saying it. Copyright is a weird beast that really doesn't fall into either of these areas.
        • by deathy_epl+ccs ( 896747 ) on Friday January 04, 2008 @07:28PM (#21916708)

          We all know that labels screw artists and DRM is bad and blah blah blah, but what happens if your favorite action films cost $50 million to make, but suddenly all of the customers have "digital content wants to be free" philosophies?

          This argument has no basis in reality, though... people are not going to universally stop paying to go to the movie theatre, and they're not going to stop buying DVDs.

          I remember another industry that piracy was going to kill. It used to be called the Video Game industry, and man, were they cool. When we were kids, we used to play the darned things all the time. Unfortunately, rampant piracy put them completely out of business and there are no more video games.

          Of course, in reality what's happened is that the video game industry has become one of the biggest modern growth industries there is... and you know what? People are still pirating the games too.

          I'm not coming out for or against piracy here, but when we have these discussions, we should at least try to look at things from a realistic perspective instead of dogmatic positions.

          • Re: (Score:3, Insightful)

            I'm not coming out for or against piracy here, but when we have these discussions, we should at least try to look at things from a realistic perspective instead of dogmatic positions.

            I believe you're missing the underlying ethical implication of the GPP. The point isn't that it's realistic for everyone to suddenly stop watching movies. The point is that for a behaviour to be ethical, it has to remain realistic if everyone in society did choose to act the same way. In this case, if everyone ripped content illegally and no-one paid for it, there would be very little content available for anyone. That means that the people who do act in that way today aren't just getting the content for

            • Re: (Score:3, Insightful)

              by grimwell ( 141031 )

              In this case, if everyone ripped content illegally and no-one paid for it, there would be very little content available for anyone.

              Maybe more content would be created... have you heard of the Grey Album [wikipedia.org]

              Or maybe

              When in the chronicle of wasted time
              I see descriptions of the fairest wights,
              And beauty making beautiful old rime,
              In praise of ladies dead and lovely knights,
              Then, in the blazon of sweet beauty's best,
              Of hand, of foot, of lip, of eye, of brow,
              I see their antique pen would have express'd
              Even such a beauty as you master now.
              So all their praises are but prophecies
              Of this our time, all you prefiguring;
              And for they looked but with divining eyes,
              They had not skill enough your worth to sing:
              For we, which now behold these present days,
              Have eyes to wonder, but lack tongues to praise.

              --William Shakespeare

              Or put another way...

              Immature poets imitate; mature poets steal.

              --T. S. Eliot

              Strengthening the author's side of the copyright agreement is a folly. It is society's side that needs to be restored.

            • Re: (Score:3, Interesting)

              by tkw954 ( 709413 )

              The point is that for a behaviour to be ethical, it has to remain realistic if everyone in society did choose to act the same way.
              Sorry, that definition of ethical is ridiculous. I don't want to be a garbageman, but it wouldn't be realistic if everyone in society also chose not to be a garbageman. Are you saying that my only ethical choice is to be a garbageman?

              Almost everything you do would be unrealistic if everyone chose to do the same.

        • by Ash Vince ( 602485 ) on Friday January 04, 2008 @07:32PM (#21916728) Journal

          Frankly, if nobody pays to see movies, no movies will get made - or at least, only cheap movies where the person making them can afford to eat the cost.
          Some of us actually prefer low budget, made for the love of it movies just like you describe.

          One example that springs straight to mind is Clerks. I far prefer this to any of Kevin's more recent works. I still like his more recent stuff like Chasing Amy, but it does not hold a candle to the film he made just for the love of film.

          Another example which is not so well known is El Mariachi (http://www.imdb.com/title/tt0104815/). This is the forerunner to Desperado but is far superior in plot and storyline. It lacks the huge explosions (no rpg firing guitar cases) but this is not a loss in my opinion. Far too often the drive to spend huge amounts of the studios money on special effects actually detract from other areas of the film that usually have much longer lasting appeal.

          Another problem with Hollywood movies is the actors. They frequently bitch and moan trying to get their own role "enhanced" just to get their useless overpaid faces on the screen for more time since this will increase their future earning potential. Or they try and get less well known actors with far more talent entirely removed from productions or their scenes cut if they are clearly better actors and show them up on screen.

          Usually the director will have to go along with a certain amount of their whining in case they threaten to walk off set. Unless the director is more well known than the actor quite frequently the lead can get their part substantially changed on a whim.

          Then there is the studios notoriety at tax avoidance. You do not get a type of accounting named after you for nothing:

          http://en.wikipedia.org/wiki/Hollywood_accounting [wikipedia.org]

          So even after all this you want me to feel sorry for them if they go out of business? Be serious.

          The fact is that there will always be an entertainment industry, since people love to be entertained. If the current form of it died out it would be replaced by something else since someone will always fill that gap and try and make a few pennies out of us in the process. This is not a bad thing, but trying to just skip to the pennies without providing original entertainment first is.

          I say original in the previous statement because of the number or sequels or remakes that Hollywood turns out. But this rant has gone on long enough so lets not start on that.
        • but what happens if your favorite action films cost $50 million to make, but suddenly all of the customers have "digital content wants to be free" philosophies?

          From your tone I take it that there must be some drawback that's escaping me?

          Anyway, haven't you watched South Park? When you do that for music, Michel Jackson can't buy his 12th Ferrari. For movies, I assume the governator won't be able to buy his 12th Humvee, nor his reelection.
        • but what happens if your favorite action films cost $50 million to make

          If a film takes $50 million to tell a story, then a lot of Slashdot users would call the film horribly uneconomic at telling this story.

          No more magical Hollywood special effects.

          There exist a lot of moviegoers who would say good riddance.

          You're not going to see Lord of the Rings get produced under a Creative Commons license.

          That's more the Tolkien estate's decision than Hollywood's. Besides, I'm not going to live to see a film adaptation The Lord of the Rings with Tom Bombadil's scenes or without inane jokes at the Dwarves' expense get produced under any license.

          Even if the whole business isn't "respectable" by your standards, you obviously respect their work enough to watch it.

          No. I watch movies because I'm paid to. In my case, the people who pa

          • Re: (Score:3, Funny)

            by bitingduck ( 810730 )

            No. I watch movies because I'm paid to. In my case, the people who pay my rent will stop paying my rent if I do not accompany them to theaters.
            Your parents will throw you out of the basement if you don't go to the movies with them?

            That's harsh.
        • Re: (Score:3, Interesting)

          by UncleTogie ( 1004853 ) *

          In context, I presume you mean pirating their work.

          No. No pirating necessary.

          I'll use Sony as an example. When a client comes in, engage the standard /. rant on Sony. There's MORE than enough material there to hurt their bottom line without a single CD/DVD rip. Remember, folks, people many times trust our decisions on technical matters. If you tell 'em that Sony's not a brand to buy {and why}, many times they'll take that as gospel. Let 'em know where the problem is and why... they'll listen.

        • by dwandy ( 907337 ) on Friday January 04, 2008 @09:33PM (#21917980) Homepage Journal

          Frankly, if nobody pays to see movies, no movies will get made
          I guess all that TV I watch is just my imagination hard at work? 'Cause I haven't paid for any TV content (the signal, yes if you have cable/satellite, the content is paid by ads)

          Don't confuse "how it's financed under the current system" with "the only way content will get financed"

          Beyond that, you're also ignoring the fact that large percentages of the costs of making movies is clearing copyright -- if movies get made using cc content, then they won't cost what they do now. Furthermore, there is nothing that Actor-X does that makes him worth $20-million for a movie. He gets paid that because there is an expectation that the movie will make enough to pay him that. Stage actors make working-type wages (since that is what stage can afford to pay) and they are still able to attract talent. Clearly if movies make less in general, the Big Name Actors and Big Name Producers and Directors will be the first to take massive pay cuts. That doesn't equate to "no more movies being made"

          And then the final question I always ask is: who cares if they don't make $100million films any more? If we actually care about the cost of a movie, then the question of "what could we do to make sure that $500-million movies get made?" becomes an equally valid question. Or perhaps 25% of the GDP should be directed at movies to make sure that multi-billion-dollar movies can be made?

          Purely speaking, "cost" isn't really a factor in determining the artistic merit, or even quality. "Relative cost" seems to be positively related to quality (roughly), but still no relation to artistic merit.

          So if the "cost" bar lowers from $50-million average movie to $1-million, those movies will still have excellent quality - the actors et.al will just be driving Toyota's like the rest of us instead of picking out the Porsche-du-jour.

        • Re: (Score:3, Funny)

          Frankly, if nobody pays to see movies, no movies will get made - or at least, only cheap movies where the person making them can afford to eat the cost. No more magical Hollywood special effects.

          Good. Maybe they'll go back to making movies that are actually worth watching and wouldn't insult the intelligence of even a Congressman. Not that I condone piracy, even if what you are copying is worthless.

          You're not going to see Lord of the Rings get produced under a Creative Commons license.

          It's already been do
    • by Anonymous Brave Guy ( 457657 ) on Friday January 04, 2008 @06:02PM (#21915706)

      It's funny, I went to Amazon the other day to see what was available for DRM-free download. Do you know what the answer was?

      Nothing. For some strange reason, the service is only available to those in the US. The rest of us are still stuck in 2000 or something.

      Still, at least the light bulb is starting to glow. Next, you'll be telling me I can buy legal DVDs that don't make me sit through several minutes of tedious anti-piracy drivel that doesn't even apply in my jurisdiction, just like all the illegal ones I could have bought more cheaply instead...

    • Wait until some breakthrough artist figures out they no longer need to be beholden to the record labels for their livelihoods.

      I just thought about this in reference to my friends band. They are good enough to be signed but have not been yet. They really don't need a record label for distribution. They do however need a company to promote them for a percentage of the profits. They advertise on Myspace [slashdot.org] and their own website [virb.com] and through purevolume [purevolume.com] and through word of mouth. Still, I'm sure nobody on here ha

    • Wait until some breakthrough artist figures out they no longer need to be beholden to the record labels for their livelihoods.

      Actually, artists have a limited choice -- the big this is: wait until some breakthrough recording studio figures out that they no longer need to be beholden to the record labels for their livelihoods. THEN we'll see a revolution in music distribution.

      Just imagine -- a recording studio that will give you access to high quality recording and post-production tools, AND will handle your international distribution and publicity, completely side-stepping the labels. There are a few mid-size indie labels that operate somewhat along these lines, but all you really need for music distribution are the artists, the performers (usually the artists, although studio musicians also play a part), the recording studios and a recognizable internet presence.

      Studios could even modify their recording contracts so that some of the costs to the artists would be offset by website advertising, and the studio takes a (small) cut of every song sold through their site. This gives the studio impetus for doing a good job on the post-production, but also lets artists eat the cost when necessary.
  • by Anonymous Coward on Friday January 04, 2008 @05:40PM (#21915304)
    Back when Sony was putting root-kits in it's music CDs I felt justified in pirating their music.

    Now I just feel OK about it.
  • Powerful? (Score:5, Insightful)

    by earlymon ( 1116185 ) on Friday January 04, 2008 @05:41PM (#21915326) Homepage Journal
    What does it mean, Apple's become too powerful, so Sony needs another distribution channel? Is Apple driving the prices up? Is Apple restricting Sony to only sell DRM'd music? Is Apple incapable of supporting non-DRM formats? Does Apple not reach sufficiently worldwide.

    Like a guy who's murdered his parents pleading mercy as an orphan - Sony pleading innocence over where they're at with ecommerce of their music.
    • I think the expression "hoist by his [i.e. Sony's] own petard" comes to mind.
    • Re: (Score:3, Informative)

      by Sciros ( 986030 )
      The article goes on to explain that this has to do with price control. As by far the leading distributor of online music, Apple can maintain a $.99 price point for all songs. The record labels want variable pricing (more than $.99 for some songs, presumably, and hopefully something like $.01 for things like Britney Spears's new crap but that's too optimistic) and by striking contracts with Amazon and other distributors they might be able to put some pressure on Apple in this regard.
    • by jmauro ( 32523 )
      Apple is keeping prices down, even as the record companies other businesses are losing more and more money. The record labels want to raise the price and Apple told them no. The same issue is playing out in video, but Apple isn't as strong there the video content producers have decided to take their ball and go home for now.
      • Re:Powerful? (Score:4, Insightful)

        by earlymon ( 1116185 ) on Friday January 04, 2008 @06:12PM (#21915890) Homepage Journal
        Sorry, but Apple keeping prices down - on a breakthrough distribution method with a breakthrough product that expanded the market insanely - doesn't equate to Apple's fault that record companies are losing money.

        What do you suppose Sony's income would have been without Apple forcing them into a viable online marketing strategy in the first place?
      • Dropping DRM is really great. I think that what Apple did, using its market power to turn the table on the record labels, game was just great! The big record labels will just continue suffering the consequences of their Holy Inquisition type of business model until they break.

        On the other hand, now that the record labels are going against Apple's power and using Amazon to try to fight against Apple monopoly on iTunes, the other evil player on this game is going to have to adapt as well. Now Apple will hav

      • If the labels want to jack up the prices, why are they going through Amazon, which is generally cheaper than iTunes?
    • Re: (Score:2, Insightful)

      by ivan256 ( 17499 )

      What does it mean, Apple's become too powerful, so Sony needs another distribution channel? Is Apple driving the prices up? Is Apple restricting Sony to only sell DRM'd music? Is Apple incapable of supporting non-DRM formats?

      None of your hypotheticals. It simply means that Apple wants too big a cut of the profit. Sony feels it can't make money selling downloads that don't work on iPod, and Apple has said that they need to either use no DRM, or give Apple a big check to use Apple's DRM. Otherwise no-iPods.

      • Re: (Score:2, Insightful)

        the iTunes Music Store profit is negligible. The record label gets around 70% of the purchase price. The iPod is where the money is at., and Apple has (rightly) refused an RIAA tax on it.
      • Re: (Score:3, Insightful)

        by peragrin ( 659227 )
        Apple makes 9 cents a song. with that they have to pay the credit card company, pay for the bandwidth, storage, ripping costs.

        i would be surprised if apple has made 50 million dollar profit on the 3 billion plus songs sold. Amazon is one of the few who could compete on that level.
    • Re:Powerful? (Score:5, Insightful)

      by tlhIngan ( 30335 ) <slashdot.worf@net> on Friday January 04, 2008 @05:58PM (#21915668)

      What does it mean, Apple's become too powerful, so Sony needs another distribution channel? Is Apple driving the prices up? Is Apple restricting Sony to only sell DRM'd music? Is Apple incapable of supporting non-DRM formats? Does Apple not reach sufficiently worldwide.


      More like, "Apple won't bend over and cede to our demands!"

      Everyone knows that Apple has a standard iTunes contract. Now that iTunes has proven to be the #1 place to get music legally, and is something like #3 in marketshare for music, the labels are worried because Apple has this store that sells to the #1 music player, and no other store has that potential. Apple could very well dictate the terms, basically by saying "This is our offer. Take it or leave it." (whether that includes iTunesPlus or not... I don't know).

      Amazon opens up a store that's DRM free, and backed by a relatively large and well-known company.

      Labels have a choice - bend over and accept Apple's terms, and keep DRM, and be usable on the #1 music player. Option 2 - make their own terms with Napster/Zune/etc, keep DRM, but be usable on the small subset of players. Now with Amazon, option 3 is, negotiate with Amazon (they need music), drop DRM, and be usable on the #1 music player.

      Labels have decided that temporarily, dropping DRM is better than Apple's terms, and hope to make it such that instead of Apple dictating the terms to the labels, the labels will be in the power to dictate terms to Apple ("We have Amazon. We don't need iTunes") and hope that Apple rolls over.

      It's really a power play. The labels are afraid of having terms dictated to them, and see if they can make Amazon a powerful music store, that hopefully they can leverage Amazon against iTunes. If Amazon is too powerful, they can ditch Amazon for iTunes. But in the meantime, they know that by weakening iTunes, Apple won't be able to standard-contract them.

      And if Apple closes the iTunes store, they can ditch Amazon as well, and we'll be back at square 1. So closing shop isn't a real option, but having iTunes and Amazon compete for labels is.

      For the consumer, it's "ain't competition grand?" for now. Once Amazon saps some of iTunes' strength, they'll put back in their demands of "demand pricing" or whatever other crap they want, knowing Apple will want to compete with Amazon.

      Interesting play, interesting times. I say, enjoy it while it lasts...
      • by Rix ( 54095 )
        They'll have to give everything to both. If it's not available at the preferred merchant, people will just pirate it.
      • Labels have decided that temporarily, dropping DRM is better than Apple's terms, and hope to make it such that instead of Apple dictating the terms to the labels, the labels will be in the power to dictate terms to Apple ("We have Amazon. We don't need iTunes") and hope that Apple rolls over.

        And if Apple ever did roll over, these non-DRMd tracks would disappear faster than fried chicken at a weight loss clinic. Which is why I'll still recommend that anybody who wants digital music (personally, I don't -- i

      • by Danathar ( 267989 ) on Friday January 04, 2008 @06:52PM (#21916502) Journal
        Everybody talks as if Apple dies or thrives on Itunes sales.

        WRONG!

        Most analysts agree and Apple has all but confirmed they make almost NO money on the itunes store. Rather it's just a vehicle to sell more hardware (ipods, iphones, isomethings). Geeks like devices that have lots of options, and we like to crap on the ipod due lack of this or that feature. Normal non-geeks have been buying the ipod and associated devices due to other reasons other than for the the online itunes store. The idea if itunes goes away the ipod will vanish into oblivion is crazy. If Amazon gets bigger than itunes and Apple can still make a player that sells better than the others it's a win-win situation for them.

      • Re:Powerful? (Score:4, Interesting)

        by nine-times ( 778537 ) <nine.times@gmail.com> on Friday January 04, 2008 @07:54PM (#21916984) Homepage

        Labels have decided that temporarily, dropping DRM is better than Apple's terms...

        The odd thing is that when you read the executives of the big 4 complain about Apple, what you hear about is how Apple's DRM isn't strict enough and their prices are too low. So their solution, apparently, is to move to a company with no DRM and even lower prices.

        As a consumer, I'm not complaining. Still, it seems strange, and I haven't heard anyone come up with an explanation that satisfies my curiosity. What's the plan here? Run Apple out of the business? Then what?

    • Re: (Score:3, Interesting)

      by Have Blue ( 616 )
      Too much of the world owns iPods. The iPod does not support any DRM system other than the one Apple controls. If Sony wants to sell music that these people can buy, they have 2 choices- release as a DRM-free format, or roll over and sell on the ITMS on Apple's terms. There are no alternate electronic music stores that can be used as leverage when negotiating with Apple, and there are no alternate playback platforms that would make cutting out the iPod audience a serious option.

      The music industry lost the
    • Re: (Score:3, Insightful)

      by flanksteak ( 69032 ) *

      What does it mean, Apple's become too powerful, so Sony needs another distribution channel?

      Even if you're not currently getting screwed, it's usually not in your best interests to be dependent on a single distributor. FakeSteve summed it up nicely a while back [blogspot.com].

      It's almost like iTunes is doing to the record companies what they've been doing to the artists and record stores for so long: maintaining vise-grip control of the channel. Only with iTunes, nobody else seemed to want it in the beginning.

    • by Phroggy ( 441 )

      What does it mean, Apple's become too powerful, so Sony needs another distribution channel?

      Yes.

      Is Apple driving the prices up?

      Quite the opposite - Sony wants to drive prices up, and Apple won't let them.

      Is Apple restricting Sony to only sell DRM'd music?

      No, but the most popular portable digital music player won't play DRM'd music from anyone but Apple.

      Is Apple incapable of supporting non-DRM formats?

      Nope, EMI is selling non-DRM'd music through Apple. Apple would love for Sony to do the same.

      Does Apple not reach sufficiently worldwide.

      Not the issue either, although there are a lot of countries Apple doesn't reach.

      If you want to sell music through Apple, Apple sets the price. Those are the terms, take it or leave it, and because of Apple's monopoly position, Sony

      • The first question was NOT of the yes/no type. The other questions were rhetorical to illustrate the point. I disagree that Apple has a monopoly position, they have a hegemony - your point makes more sense with that substitution.

        You've made my point for me if we allow that substitution, but under that condition I would add that what Sony sees and what reality is, are two entirely different things.
    • ... leverage.

      It's their music, they want all the leverage they can get.
    • Is Apple driving the prices up?

      No, they are driving prices down. The studios did not want to charge 99c per song for the most popular artists, only for the people you had never heard of yet. For the most popular artists they wanted to charge a premium. Apple used their dominance to try and force a flat rate for all artists:

      http://www.businessweek.com/technology/content/sep2005/tc20050929_4235_tc056.htm [businessweek.com]

  • Hopefully the industry will learn a broader lesson about proprietary formats, including physical ones.
  • thanks Apple! (Score:2, Insightful)

    Apple convinced them to sell per-song downloads, then got so successful at it the big record labels had to abandon DRM to spite them.
    • I want to see a leaked Apple memo from their early strategic planning. If Steve Jobs had this all mapped in 2001 and then Fausted the labels, I think some quarter's "miscellaneous earnings" would see a chunk of change if they sold the memo on ebay.

  • they could have built their own portals in 1999. they didn't. they filed lawsuits against soccer moms and college kids instead

    apple came, gave college kids what they wanted many years later, and so the big publishers, by denying reality of the changing business they were in, effectively handed apple all of the power they previously had, and could have retained

    they screwed themselves

    no sympathy
  • See? No Monopoly (Score:3, Insightful)

    by cmholm ( 69081 ) <cmholm@mauihol m . o rg> on Friday January 04, 2008 @05:48PM (#21915460) Homepage Journal
    This plainly shows what was obvious to those who wanted to look, that any monopoly Apple has on electronic music sales is because the record labels chose to give them one. Since they seem to be having second thoughts about that choice, they are looking at an alternative: selling straight mp3 downloads.

    If Apple ever locked down the iTunes application so that users couldn't import mp3s, then we'd have a reason to whine. But, there would still be Sandisk and the rest, as well as places to buy music for them. Choices still! Imagine that.
  • What I find ironic is that the very thing that some of us were complaining about (iTunes DRM) might end up being the very thing that saves us in the end.

    Well played itunes, well played.
  • by sm62704 ( 957197 ) on Friday January 04, 2008 @05:50PM (#21915500) Journal
    I was hit by the Sony Trojan [mcgrew.info] when my daughter played a BMG title she'd bought from the music store she worked at at the time (she manages a Gamestop now).

    I'll never EVER buy a Sony ANYTHING again, and the only way I'll get a Sony-BMG CD is used. And the only way I'll download any BMG artist is from P2P "piracy". That God damned rootkit was a damned stupid move. Someone should have gone to prison for it. If I rooted their computers I'd be with Linda [slashdot.org]; well, actually not since Dwight is a maximum security women's prison, but I'd be behind bars.

    And all she did was have some dope on her, she didn't hurt anyone, threaten anyone, or cost anyone any money.

    If you own Sony stock, please do me a favor and sell it. Sony is EVIL in all capital letters.

    -mcgrew
    • by sconeu ( 64226 )
      [AOL] Me Too! [/AOL]

      The other day, I was just explaining to my wife why I won't even look at a Sony this summer, when we have to buy our daughter a laptop for college.

      The explanation was simple. "I'm boycotting Sony. Remember last year when I told the girls to check with me before playing any CDs on their computer? That was because of Sony."

  • by db32 ( 862117 ) on Friday January 04, 2008 @05:50PM (#21915514) Journal
    Is anyone surprised at this? Let us examine the Sony portfolio of media...

    Betamax - fucked themselves - now deal with VHS gear
    Minidisc - fucked themselves - now deal with CDs
    Memory Stick - fucking crap - everyone else deals with SD, waiting for them to realize they are fucking themselves
    Blueray - nothing exciting - everyone is still basically on DVDs with no incentive to change

    Now we can add

    DRM digial music - fucked themselves - now drop DRM to sell more.
    • Re: (Score:3, Informative)

      by mrchaotica ( 681592 ) *

      Memory Stick - fucking crap

      Yep. Memory Stick is why I wouldn't buy Sony electronics before the rootkit/DRM/etc.; the rootkit/DRM/etc. is why I'll continue to boycott them even for products that don't have Memory Stick readers.

    • Blueray - nothing exciting - everyone is still basically on DVDs with no incentive to change
      Blu-ray is clearly the dominating format and in at least my (and quite a few others I've heard) case hampered in adoption primarly from the uncertain format war. If HD-DVD would only die, and the discs were slightly cheaper, I'd go Blu-ray.
  • This is why Apple wouldn't license their FairPlay DRM to competitors. Kudos to Steve Jobs for pulling this off. He's always said from the beginning that DRM is a bad idea.

    How will this impact Apple? Sales through the iTunes Store may dwindle a little, but sales of iPods will continue to climb.
  • So if Sony is the last holdout in the DRM space, what's the point of the RIAA again?
  • Getting rid of DRM is excellent, but going to MP3 is kind of like offering GIF instead of JPEG. Sure, it works and all, but AAC is the improved successor to MP3. Apple is going to have the audiophile* edge by selling unencumbered AACs if its competitors like Amazon.com stick with MP3. Not sure if that's going to be a big sway, but I personally prefer AAC.

    *I'm aware of flac, et al, and the audio purity arguments, but I'm talking about dominant market conditions.
    • Re:I still want AAC (Score:4, Informative)

      by STrinity ( 723872 ) on Friday January 04, 2008 @07:30PM (#21916718) Homepage
      Amazon uses VBR with the average song being between 196 and 256kbps. At that quality an MP3 is indistinguishable from a CD even on high-end speakers. The only advantage of AAC is that it can achieve those rates with smaller file sizes. Since the vast majority of files sold by Apple are ony 128kbps with DRM, there's no contest here.
  • by prostoalex ( 308614 ) on Friday January 04, 2008 @06:00PM (#21915696) Homepage Journal
    AllofMP.com has been pioneering the model all along.
  • by compumike ( 454538 ) on Friday January 04, 2008 @06:04PM (#21915730) Homepage
    They want to protect their intellectual property, which is understandable (although I'm sure some slashdotters will argue this point). But I think fundamentally we're going to have to accept one of two mechanisms by which they can do that. The first is DRM, and the problem is that it undermines lots of legitimate (fair, free) uses of the content. The second is lawsuits for civil or criminal copyright infringement, which have significant statuatory damages.

    So I'm happy that people are waking up to the problems with DRM, and that companies are realizing it too. But realistically this means that more enforcement burden will be on legal action, which tends to be economically burdensome on individuals, although it is more likely to produce a socially acceptable result (allowing certain cases of fair use).

    --
    Educational microcontroller kits for the digital generation. [nerdkits.com]
    • Why do "we", which I'm going to define as society at large, HAVE to accept one or the other? How about if society decides that mechanical reproduction, and sharing, should be essentially free and that money should be made on live performances and original sales of physical media only?

      It's people like you that leave me scratching my head. You have apparently forgotten that it's we, the people who make up society, that decide what the rules (laws) of the land are going to be!
  • by jhfry ( 829244 ) on Friday January 04, 2008 @06:04PM (#21915748)
    What I don't understand is why the labels have such influence in the sales of music. Contrast it with retail sales and you will understand what I mean. In typical retail sales, the retailer purchases X items from a distributor or direct from the manufacturer and sells the for whatever they choose, allowing the retailer to compete and allowing the manufacturer sell the items for their desired profit margin, the only people who's profit margins are influenced by competition (of the same product) are the retailers.

    In the online music world, the Label places all kinds of stipulations and requirements on the seller. Wouldn't they simply be better off selling X licenses for Y cents per license to as many online sellers as possible and let them duke it out over selling as many as possible. You would see Apple's, and many other sellers', profit margins drop as competition raged. Consumers would be buying at lower prices, which would increase overall sales, and advertising would increase as different sellers tried to attract new buyers.

    Overall, a simple Manufacturer -> Distributor -> Seller -> Buyer structure where the manufacturer is hands-off on the sales end would probably make the most money for them. Even with piracy raging in the background, I guarantee that if I could pick up a bunch of music for $.25 per song (with $.24 going to the label), I'd be all over it. If the label want's more money for a newer track, simply sell it to the distributor/seller for a higher price and let them figure out how they want to move it.

    I would imagine you would see 2 for 1 deals, free downloads, and all kinds of other schemes where sellers would take a loss on the low cost music to see higher profit margins on the higher cost tracks.

    All I can say is... stop letting the labels set the retail prices, let competition and demand dictate the price. It's worked for almost every industry since the dawn of trade and there is a good reason, it makes everyone happy because they feel like they are getting a fair deal.
    • Reduced price flexibility for retailers is less common in the non-music world, but it's not unheard of. Apple itself is a good example. They rigidly control the retail price of all their hardware. That's why when Fry's has an ad touting a sale on iPods or MacBooks the sale price is $294, down from $299. Whoopee.

      Price control by manufacturers is supposed be illegal, but it's pretty common in the electronics/computer world. I'm not exactly sure how it's done, but it happens.

  • Unless they didn't get the memo, there must be something else at play here, likely just adding channels.

  • by headkase ( 533448 ) on Friday January 04, 2008 @06:09PM (#21915818)
    If you go to Nine Inch Nails [nin.com] website you'll find the results of an experiment they just ran through. They offered an album for free with the option to pay if you felt like it. To cut to the chase, 18% paid for it (at $5 a pop). That may sound like a poor result and it would have been if it was fifteen years ago. Today however, the game has changed, the music industry used to be based around the concept of scarcity. They had a physical product and the only method of distribution involved moving that product around. Today, information can be replicated for almost zero cost instantly world-wide. Scarcity as a assumption in the business model no longer applies. So if traditional media companies are to save themselves they need to radically change their mode of operation or go extinct. Without scarcity, the only other tangible benefit they have to offer is the experience itself. This means shifting where they expect to get the majority of their revenue away from what is no longer scarce - the music itself - to what is still in short supply: live concerts, t-shirts, mugs, unique (signed?) physical items and such. The music itself can almost be written completely off as a promotional expense to attract business to the items that for are still scarce. Information networks have completely changed the rules of the game in many areas and media companies are just the people to experience it first. If they lack the vision to capitalize on products and services that are still scarce then they will remain as relevant as the steam engine. And there's nothing they can do to stop it - no matter how much "protection" they place on their wares there is a whole new generation of artists growing up right now that don't really see a pressing need to sign with a big label in the first place so if the labels don't adapt and continue to offer something of value then, well, economics is a bitch.
    • Re: (Score:3, Interesting)

      by headkase ( 533448 )
      Sorry, got so wrapped up I forgot to mention the fundamental scarcity that has been pulled out from under the feet of media: scarcity of manufacturing - e.g. cd-pressing plants. It used to cost big bucks to get your music into the hands of people who wanted to hear it. Now it just requires a web server, some audio software and talent.
    • by vimh42 ( 981236 )
      Sounds to me like Trent was a bit disappointed in the numbers. As he put it, they were 'disheartening'. I'm not sure what to make of that. As he states that he wasn't sure what his expectations really were.

      I had not heard of this effort or the artist and the album. Now that I have I will download them and listen to them. If I like it, I will buy it. If I don't, I will delete it. Doesn't that skew the numbers? Isn't that what a large number of people will do or have done?
    • by xaxa ( 988988 )
      Thanks for that, I hadn't heard about it. The album is available from http://niggytardust.com/ [niggytardust.com] -- and I just bought it. I have no idea what the music is (I haven't heard of Saul Williams) but Nine Inch Nails were the best major band at the Reading Festival this year, so hopefully it'll be something I like :-)

      $5 (£2.52 for me) for 427MB of FLAC -- that's an excellent price!

      What does $5 get you as a student in, say, New York? In London, £2.50 would buy one of:
      - four cans of coke from a vending
      • by xaxa ( 988988 )
        No, I really don't like it.

        For sale: "The Inevitable Rise and Liberation of NiggyTardust!" by Saul Williams. Any offers? I can only upload it to you at 1.3Mb/s (bits). I don't want the money, give it to a local charity instead :-)
  • when? (Score:2, Funny)

    by pak9rabid ( 1011935 )
    So they either shaft the consumer with DRM, or shaft Apple by removing DRM. Granted the latter is friendlier to the consumer, but when will the labels put and end to shafting people and just give their customers what that want without ulterior motives? Probably when their shit turns purple and smells like rainbow sherbet.
  • by Cajun Hell ( 725246 ) on Friday January 04, 2008 @06:31PM (#21916178) Homepage Journal

    the only way to buy digital music for the iPod was from Apple

    WTF? This isn't 1992; CD-ROM drives are ridiculously affordable, and even Macs aren't locked into Apple-brand drives. This guy is wacked if he thinks iTMS is the only place where someone can buy digital music that can be loaded onto an iPod. Even Sony has been selling it. For decades. Without any DRM.

    • by sconeu ( 64226 )
      Even Sony has been selling it. For decades. Without any DRM.

      Even Sony has been selling it. For decades. Without any DRM -- except the rootkit.

      There. Fixed that for ya!
  • by earlymon ( 1116185 ) on Friday January 04, 2008 @06:36PM (#21916236) Homepage Journal
    From http://www.apple.com/hotnews/thoughtsonmusic/ [apple.com]

    Apple, Microsoft and Sony all compete with proprietary systems. Music purchased from Microsoft's Zune store will only play on Zune players; music purchased from Sony's Connect store will only play on Sony's players; and music purchased from Apple's iTunes store will only play on iPods. This is the current state of affairs in the industry, and customers are being well served with a continuing stream of innovative products and a wide variety of choices.
    and also

    Perhaps those unhappy with the current situation should redirect their energies towards persuading the music companies to sell their music DRM-free. For Europeans, two and a half of the big four music companies are located right in their backyard. The largest, Universal, is 100% owned by Vivendi, a French company. EMI is a British company, and Sony BMG is 50% owned by Bertelsmann, a German company. Convincing them to license their music to Apple and others DRM-free will create a truly interoperable music marketplace. Apple will embrace this wholeheartedly.
    That's from 11 months ago - so please, no sympathy for Sony's actions in this.
  • Why do I need special downloader software from Amazon.com? Can't I just pay for it & then download the song or album?
    • I believe the MP3s are compressed when you download them and the DL manager uncompresses them for you. It also interfaces with iTunes and adds the files to your library so you don't have to go into the "Add File" dialogue.

      It also helps if you experience a problem while downloading. The way it works, you download a file which tells the DL manager how to get the MP3s. If your connection craps out or Windows crashes in the middle of the download, you only have to open the file and it'll restart the download.
  • The iTunes music store is a great motivator to get customers to get iPods. While Apple keeps a tight lid on it's operating expenses, most analysts, and plenty of slashdot "pundits" have said that Apple could not possibly be making any significant profits, if any, on the store itself, it's the hardware they make money on.

    Okay so the iTunes music store becomes less relevant and is less of a selling point for Apple. Was it that relevant to begin with? Apple's next plan? Integration with Safari to download
  • by theurge14 ( 820596 ) on Friday January 04, 2008 @07:47PM (#21916884)
    The iTunes store already has DRM-free tracks available. It's called iTunes Plus and they're 256kb AAC tracks with no FairPlay restrictions. So far the only major taking advantage of this are EMI. Sony BMG could be using this right now if they so desired. Steve Jobs has said so [apple.com].

    What this is about is that Apple refuses to let the majors set the prices of the singles. One of the major selling points of the iTunes store since it began has been that the single tracks are 99. The majors want to charge more for popular tracks. Apple refused. A similar event already happened with NBC leaving iTunes over pricing control issues.

    Sony BMC will come crawling back to the #3 distribution channel again once their own project fails. A quick Google reveals that Sony has an online store of their own called Sony Connect [slashdot.org]. Let's see... requires Windows and Internet Explorer. Well, looks like I'm out of luck...no thanks Sony.

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