updated 03:00 pm EST, Tue February 6, 2007
Jobs embraces free music
Apple CEO Steve Jobs in a letter to the world at large has openly embraced DRM-free music, but says his company cannot remove digital rights management (DRM) protection until the big four record labels agree. "Imagine a world where every online store sells DRM-free music encoded in open licensable formats," said Apple's chief. "In such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players. This is clearly the best alternative for consumers, and Apple would embrace it in a heartbeat." Jobs says if the big four music companies would license his company their music without requiring that it be copy-protected, Apple would switch to selling only DRM-free music on its iTunes store. The executive also notes that every iPod ever made will play DRM-free music, and questions why the big four music labels refuse to let Apple follow this path. [updated]
"Why would the big four music companies agree to let Apple and others distribute their music without using DRM systems to protect it?" asked Jobs. "The simplest answer is because DRMs haven't worked, and may never work, to halt music piracy. Though the big four music companies require that all their music sold online be protected with DRMs, these same music companies continue to sell billions of CDs a year which contain completely unprotected music. That's right! No DRM system was ever developed for the CD, so all the music distributed on CDs can be easily uploaded to the Internet, then (illegally) downloaded and played on any computer or player."
Under 2 billion DRM-protected songs were sold worldwide in 2006 via online avenues such as Apple's iTunes Music Store, while more than 20 billion songs were sold completely DRM-free and unprotected on CDs by the music companies themselves.
"The music companies sell the vast majority of their music DRM-free, and show no signs of changing this behavior, since the overwhelming majority of their revenues depend on selling CDs which must play in CD players that support no DRM system," Jobs continues. "So if the music companies are selling over 90 percent of their music DRM-free, what benefits do they get from selling the remaining small percentage of their music encumbered with a DRM system? There appear to be none."
Apple's head notes that if anything, the technical expertise and overhead required to create, operate, and update a DRM system has limited the number of participants selling DRM protected music.
"If such requirements were removed, the music industry might experience an influx of new companies willing to invest in innovative new stores and players. This can only be seen as a positive by the music companies."
Turning to swelling concerns over DRM systems in several European countries, Jobs suggests that those unhappy with the current situation redirect their energies toward persuading the music companies to sell their music DRM-free. Universal -- the largest of the big four record companies -- is 100 percent owned by French company Vivendi, while EMI is British owned. Sony BMG is half owned by German-based firm Bertelsmann, making two and a half of the big four record labels European-based.
"Convincing them to license their music to Apple and others DRM-free will create a truly interoperable music marketplace," said Jobs. "Apple will embrace this wholeheartedly."
A Scandinavian-led effort to force Apple to open its closed iPod/iTunes ecosystem in several countries has continued to grow in recent months, attracting an increasing number of European nations as they lobby for consumer rights. Countries that have expressed interest in the movement currently include Norway, Sweden, Finland, France, Germany, and the Netherlands.
A French law that repeatedly threatened to shut down that country's iTunes Music Store officially went into effect on August 3rd of 2006, following several drafts that would have forced Apple to open its FairPlay DRM to competitors and ultimately leading to the music labels revoking their catalogs of music from the iTunes Music Store. The final revision of the law, which went into effect after the final version was declared unconstitutional, has yet to produce a visible impact on Apple's French iTunes ventures.