updated 05:25 pm EST, Thu February 8, 2007
Warner stands by DRM
Warner Music Group has rejected the concept of abandoning digital rights management (DRM) as suggested by Apple CEO Steve Jobs in his recent open letter. The Financial Times reports that Warner chief Edgar Bronfman refuted Jobs' open letter advocating the end of DRM, attacking Jobs' statement as "completely without logic or merit" as part of the music company's latest quarterly earnings conference call. Bronfman reasserted the idea that DRM is necessary to the survival of his label's business, comparing it to the protections already in place for DVDs and computer software. Warner made the statement as the company simultaneously coped with an especially harsh decline in its financial results, reporting revenues last quarter that fell a whopping 74 percent compared to the same period a year ago, with even online-only downloads experiencing a slower than expected growth.
Bronfman publicly blamed a lack of high-profile albums and the "maturation" of the market, which could affect renewed contracts with Apple later this year. The Financial Times speculates that Jobs may point to the apparent failure of Warner's business as an incentive to switch to unrestricted iTunes songs in the forthcoming talks.