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DRM (for music) is dead

Sony is finally dropping DRM from its music. Considering that Sony has been the worst offender for consumer DRM format lock-in -- ATRAC, MagicGATE memory sticks, UMD, Sony Connect music store, and infamous rootkits -- this is truly a historic occasion. It comes on the heels of Warner's announcement of DRM-free music, which means that 2008 may be the year for toppling the iTunes Music Store crown (physical sales plummeted 15% in 2007). The Amazon MP3 store already offers cheaper, DRM-free albums than iTunes: Radiohead's In Rainbows is $7.99 vs. $9.99 on iTunes. Now the selection can truly be competitive.

Even with the rise of the Amazon MP3 store, it doesn't look like the NIN/Saul Williams/Radiohead experiments will move forward. Radiohead has followed their "pay what you want" experiment with a CD release and official release on iTunes + Amazon. I imagine others feel a bit ripped off because I do -- the tracks are much higher higher quality (256KBps MP3) on Amazon than what Radiohead offered in the "pay what you want" model. For bit snobs like me, it means that Radiohead effectively gets to charge double because I went and bought the CD anyways. I guess this counts as a success for Radiohead, but I think people might be more wary in the future.

Meanwhile, Trent Reznor of NIN seems down on the success of Saul Williams' release, citing the fact that only 28,322 out of 154,449 downloaders chose to pay $5 for the album; the rest chose the free download. Only 33,897 people bought Williams' 2004 album, but Reznor is focused on the 71.7% that didn't pay. It seems the natural comparison he's drawing is to someone walking into a CD store and buying/taking your album. The comparison I would make is to the radio -- what percentage of people that hear your music on the radio, for free, actually end up purchasing it? I ended up buying it, partly because I couldn't resist the pirate cat on the cover.

Both Reznor and This American Life cited bandwidth costs -- the latter $152,000 -- as a detractor for the online model. They could have lowered their bandwidth costs by uploading to BitTorrent or asking fans to mirror the content. Instead, even though Reznor used BitTorrent for his free GarageBand tracks, he paid Musicane for 150,000 free downloads of Saul's album. Strangely we'd rather pay money to own the mechanism, even when giving something away. I'm sure this speaks something about human psychology, but I'm not sure what.

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This page contains a single entry from kwc blog posted on January 4, 2008 10:26 AM.

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