No more DRM on iTunes

Yesterday (Jan. 6) at the annual MacWorld Conference, Apple announced that it will now move towards offering DRM-free songs at its iTunes music store. This move is backed by all four major record labels. Apple abandoned its current business model and began offering 8 million of its 10 million songs in a DRM-free format immediately following the announcement with the additional two million songs expected to be offered DRM-free by early spring. Apple had already begun offering DRM-free content as part of its iTunes Plus service. Now the entire iTunes music library will soon be DRM-free, allowing users to play their downloaded iTunes store content on different media players and devices.

Although, I have not posted any content in months, this recent move by Apple warrants much discussion. With this, Apple will also add a variable pricing model with prices per songs expected to be at 69 cents, 99 cents and $1.29.

This can be viewed at a win for music fans and the record labels that have been negotiating with Apple to get it to change is pricing model in the past. iTune’s music store users can upgrade their DRM content to DRM-free content for an additional 30 cents.

This can be perceived as a sure sign of the failure of DRM as a suitable business model for digital music distribution and in the prevention of online music piracy. Apple is currently the largest music retailer in America.

References:

Krazit, Tom (2009). A quick recap of Apple news at Macworld 2009. CNET.Com Retrieved January 7, 2009 from http://news.cnet.com/8301-13579_3-10133230-37.html?tag=txt

Sandoval, Greg. (2009). Upgrading to a DRM-free iTunes library will cost you. CNET.Com Retrieved January 7, 2009 from http://news.cnet.com/8301-13579_3-10132759-37.html?tag=mncol;txt

Walsh, Chris. (2009). iTunes Dumps DRM, Adds Variable Pricing. BillBoard.Com. Retrieved January 7, 2009 from http://www.billboard.com/bbcom/news/itunes-dumps-drm-adds-variable-pricing-1003927138.story

#1 Music Store

An interesting contradiction to my research shows that even though DRM may be on it's way out; the number one music store in is America is Apple iTunes (according to recent NPD numbers) which is known for it's strong DRM content. Eventhough, iTunes does offer DRM-free audio tracks, that number is small in comparison to the DRM tracks it offers. Apple became the number one music retailer earlier this year, surpassing Wal-Mart.



The top five music stores selling either CDs or digital tracks are as follows:



1. iTunes

2. Wal-Mart (Walmart, Walmart.com, Walmart Music Downloads)

3. Best Buy (Best Buy, Bestbuy.com, Best Buy Digital Music Store)

4. Amazon (Amazon.com, AmazonMP3.com)

5. Target (Target and Target.com)



Amazon MP3 service moved in to 4th place led by increasing sales from it's fairly new AmazonMP3.com and little decrease in the sales of physical audio discs online. As longs as Mass Market fans can get the music they want, there are less concerned with whether or not it has DRM protection. That is until they decide to change music devices and providers and find out that their music collection is not easily transferable. The DRM battle rages on.