Frankly, it's kind of astonishing.
Breaking with established practice, the EMI Group announced today that the record label’s digital catalog would go on sale over the Internet without built-in copy restrictions. EMI, the world’s third-largest recording company, will start selling the songs in May through Apple’s iTunes service and other online music retailers. “It was clear what we had to do because we hold the consumer at the center of our focus,” Eric Nicoli, EMI’s chief executive, said at a news conference. “We take the view that we have to trust our customers,” who had asked for their digital music purchases to be unencumbered by limits on copying them.
Individual songs without so-called digital rights management software will be available at a higher fidelity and cost 30 percent more — $1.29 for each song instead of 99 cents. EMI said its price for a full album without copy protection would be the same as lower fidelity copy-protected albums.
Mr. Nicoli said early market tests showed EMI that consumers widely preferred to buy songs without copy protection, even at a higher cost. Unrestricted tracks outsold the others at a rate of 10 to one, he said.
Steve Jobs, the chief executive of Apple, who shared the stage with Mr. Nicoli for the announcement, predicted that half of the songs available on iTunes would be sold without restrictions by the end of the year. None of the other three major record labels, which with EMI account for 70 percent of songs sold today, have said how they might react.
“Today, EMI is taking the next big step forward in the digital music revolution,” said Mr. Jobs, whose online music store has more than 70 percent of the market for downloaded music. “This is something that will become very popular.”
Analysts largely agreed. “This move will send shockwaves through the music industry,” said Mark Mulligan, a London analyst at the research firm Jupiter....
I suspect the other labels will simply take a wait-and-see approach, at least at first, to see just how much, if any, competitive advantage EMI gets from this. For one thing, the 99 cents price point seems to be something of a flash point as well; Apple and other music services have hit a fair amount of resistance when they try to increase either single track or album prices. For another, the idea that leaving music unprotected is just not going to sit well with them; it's likely to go over badly with some artists as well. It would be interesting to see if, say, Madonna or Metallica (are they even still around?) would withdraw their catalogs from any service that mounts them as unprotected files, or if they work their recording contracts such that the files must be protected. (The difficulty with that being that copy protection on CDs themselves is either ineffective, easy to defeat, or so user-hostile that it actually damages computers, and it's not terribly difficult to get unprotected recordings off of most CDs.)
I'm moderately puzzled as to why EMI made this announcement with Apple, rather than pulling together a coalition of the big music services to make the announcement. It's clear from the article that all music services with EMI music, and not just Apple, will be receiving unprotected files to encode as they will. (Purely a side note: I wonder if emusic.com has EMI music, and if they can afford to purchase the catalog if they don't? As the one real supplier of unprotected music, they could stand to gain quite a lot. Since they use MP3 files, emusic also has the one notable service that can be used with either iPods or Windows-based players.)
...Asked whether movies and TV shows sold on iTunes might also lose their copy protections, Mr. Jobs said two industries could not be compared. “We are offering nothing really new here since people can buy music without D.R.M. on a compact disc,” Mr. Jobs said. “Video is different from music because the movie industry does not currently distribute 90 percent of its content without digital rights management.” [...]
Yeah, video and movies will go unprotected over the MPAA's and video producers' cold, dead bodies. Or, more likely, over many many consumers' bankrupted, desperate bodies, because what's the point of protecting something after you're dead? Much better to make several thousand pointed object lessons, really.
Posted by iain at April 02, 2007 03:06 PM
