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Labels split on demands for DRM-free from Apple?

updated 04:00 pm EST, Mon December 15, 2008

Labels split on iTunes DRM

Hold-out major labels are split on what they want before allowing DRM-free tracks on the iTunes Store, anonymous sources claim. Although Apple CEO Steve Jobs has claimed to want DRM-free tracks on iTunes, only EMI and a host of independent labels have so far offered any material which can be copied without arbitrary restrictions. Apple benefits financially from DRM by forcing iTunes customers to use iPods for many tracks; this is not why DRM-free tracks have been slow in proliferating however, according to the sources.

In reality, Warner, Universal and Sony BMG are said to have separate demands before allowing restrictions to be lifted. Warner is asking for variable pricing on individual tracks, with the aim of pricing hit songs above 99 cents, while Universal wants watermarking as a security measure. Sony BMG is asking for agency, which may be the most controversial request; under this scheme Sony would be considered the real vendor of tracks, not Apple, thereby giving the former authority over how music is sold.

Apple may be extremely resistant to conceding the demands of Warner and Sony. The low cost of iTunes tracks is thought to aid the store's appeal considerably, and Apple has traditionally exercised tight controls over how its content is focused and marketed. The company has made concessions in the past however, mainly in terms of movies and TV shows, where new, old and HD videos can vary in price.

by MacNN Staff





  1. Feathers

    Joined: Dec 1969



    Sony-BMG are free to open their own store selling unlocked MP3's any way they like and they will play on an iPod...

  1. bjojade

    Joined: Dec 1969



    I love the idea of watermarking. If a user knew that their tracks would have a watermark on them so that copied tracks would be traced back to them, they would be less likely to share them. I'd be able to put them on all my devices without concern. Sounds like a great solution.

  1. BWhaler

    Joined: Dec 1969


    Won't take my money???

    I suspect the article is directional correct, but not entirely so.

    Apple already watermarks iTunes Plus songs, so odds are the Warner details are incorrect. (Unless they want additional watermarking.)

    I guess this "leak" is just expectation management that no deal is being announced in January--or any time soon.

    This is a major bummer for me since I would love to upgrade my collection to iTunes plus.

    I just don't get what the labels are waiting for. DRM helps Apple keep their marketshare and giving Amazon, et al., no DRM has done nothing.

    I hope the labels get smart and give their customers what they want--DRM free, high bit quality music. They'll make more money that way.

  1. shawnce

    Joined: Dec 1969



    The are likely requesting a digital watermark in the audio stream itself not just in the tags. Apple isn't doing the former only the later (and always has for all songs purchased from iTunes Store).

  1. WiseWeasel

    Joined: Dec 1969



    So it's looking like we'll see Universal content on there soon with watermarks (no reason for Apple not to do this besides the trouble of implementing the feature), followed by Warner once Apple decides to concede to slightly premium prices in certain cases, and Sony is obviously stalling their negotiations, and we'll have to come back next year, after they've lost more revenue. Now all we need is an awareness drive to drive people to avoid purchasing iTunes non-Plus content, so that these studios are increasingly hurt by their refusal to sell DRM-free, and maybe we'll see Sony on there as well. Apple could also hurry things along by posting a spooky 'DRM-protected' logo with a lock symbol near the regular iTunes (non-'Plus') tracks, to hurt their sales versus Plus tracks, which could be labeled "DRM-Free". 'DRM' should be a curse word.

  1. vasic

    Joined: Dec 1969



    Watermarking is a bad idea and it will degrade the audio. In several studies, test subjects were able to easily tell the difference between the watermarked sound file and clean one. Lables continue to think that people are generally thieves and will steal their content if given a chance. They don't understand that digital piracy spread because labels never offered legal alternative. When iTunes came, people were happy to pay for a download instead of hunting for a free bootleg. This is painfully obvious to anyone but labels execs.

    Also, avoiding DRM content in iTunes is actually counter-productive and a very bad idea. The precise reason why Apple has a strong hand in this negotiation is because people CONTINUED to buy DRM-protected content from iTunes instead of DRM-free content from Amazon. We should force labels to understand that DRM or not, iTunes is their only future right now. That's the only way tey'll let Apple dictate (and hence remove DRM from all).

    Therefore, keep buying from iTunes and ONLY from iTunes. Ignore DRM whenever it doesn't hobble your fair use (which happens pretty much never).

  1. moofpup

    Joined: Dec 1969



    Why don't they make these demands of Amazon? I still think they are full of it (greed).

  1. testudo

    Joined: Dec 1969


    Re: demands

    They got those demands from amazon. Amazon allows for variable pricing (Oh, the horror! Every song might not be the same price! How will people cope!). Which is also why they have some music cheaper than 99 cents.

  1. Guest

    Joined: Dec 1969



    SonyBMG (or Sony Music, as they will be rolling over to shortly) have that concession with Amazon MP3 - the downloads are sold by them through Amazon, meaning they stand to take a larger profit share.

    It's odd, because in the UK, 7Digital, and Amazon MP3 UK are all selling DRM-free MP3 tracks from all of the majors - Amazon's entire catalogue is still in the odd 256kbps VBR MP3, but with the exception of Warner, the other two use 320kbps MP3 (much like EMI did) and it seems the shop itself has just as much influence over price as the label, based on the varying 69p-99p rates for the same song across the sites.

    It's a shame that the labels can't collectively agree to do the same thing worldwide in the same way EMI did - then again, EMI is now in the hands of an established successful businessman, and whilst they run the risk of annoying some of his artists, they want to return their company to a profit-making business once again.

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