Wide Area News
If you can’t beat ‘em
by Russell Brown
Digital rights management is going the way of the dinosaur.
For two years, the New Zealand branches of the four major record companies, via their industry body, RIANZ, have been lobbying to ensure that their interests are best served in the endlessly gestating update to the Copyright Act 1994.
Although they have had to swallow a new provision permitting us (with conditions) to copy music from a CD to a computer or portable music player, they have done fairly well. In particular, they have won sweeping statutory protection for digital rights management (DRM) software, which controls how digital media can be copied and used. The provisions are so strong that the bill has been called back for high-level re-examination.
But in the interim, something extraordinary has happened. The major music companies – all of them – have abandoned DRM. EMI broke the line midway through last year, announcing that nearly all its catalogue would be available as paid digital downloads without DRM; it can be purchased as “iTunes Plus” at the iTunes store and in MP3 form from various other digital retailers (including the Kiwi-only amplifier.co.nz). Universal Music followed when the online retail giant Amazon opened its own music store.
Then, in the haze of the holiday season, Warner Music, hitherto the most fanatically pro-DRM of all the majors, announced that Amazon would be selling its music as DRM-free MP3 files. A few days later, Sony BMG announced that it, too, was going DRM-free.
The industry has had its problems with DRM, most notoriously in the case of the Sony CD copy-protection that secretly installed a “rootkit” on customers’ PCs, exposing them to malicious internet attacks.
But it wasn’t consumer problems that turned the majors: it was more the fact that DRM – which they had hoped would allow them to control their markets – had in fact become a tool for others to manipulate markets in ways that stripped the record companies of power.
We need to go back a little here. After Napster established the idea of downloading music from the internet, the majors formed into two cartels and tried to act as their own online retailers. It didn’t work – for one thing, you couldn’t buy one cartel’s releases from the other one’s shop.
Meanwhile Steve Jobs and Apple were making up for a slow start in digital music, with the iTunes software in 2000 and then the iPod in 2001. The iPod was already a tiny colossus in the market when Apple launched the iTunes Music Store in 2003. It had the mark of Jobs. For simplicity, all releases would cost the same. And Apple’s DRM, FairPlay, was far more reasonable than anyone else’s: purchased tracks could be played on up to five authorised computers and as many iPods as you liked. But only iPods.
It would have been difficult to support the competing Windows Media DRM on the iPod. But Apple also refused to license FairPlay to anyone else. It had shares of between 80 and 90 percent in both the music download and portable player markets, and those downloads played on one portable only – Apple’s. Jobs was dictating terms to the industry. And DRM gave him the power.
Warner has frankly stated that its aim is to create – in Amazon – a competitor to iTunes. This should be good for consumers, but there are problems: the Amazon Music Store is available in the US only; it’s not clear what Warner’s terms for going DRM-free with iTunes will be, nor whether Amazon might extend to markets like ours (where, ironically, the dominant retailer is Vodafone Music, which uses Windows DRM); and, on a technical basis, it is daft that the industry should converge around MP3, an ageing format that achieved ubiquity purely because it couldn’t be retrofitted with DRM.
But one thing is clear. For music at least, attempting to tightly control consumers’ use of what they have bought has not only failed to prevent piracy but become more trouble than it’s worth.
Next week: so what does the music industry do now?
Email: russb@dubwise.co.nz
