Blast From The Past: Oh Look, New Business Models Didn't Require DRM

from the thank-goodness-for-that dept

Fri, Jun 20th 2008 12:41pm — Mike Masnick

Sometimes it's fun to look back on predictions from a few years back. lavi d writes in to point out a 2001 Microsoft press release that he came across while looking for something else. The press release touts new DRM technologies coming out of Microsoft, which is amusing if you know anything about Microsoft's history with DRM. But the really key part of the press release was a VP from the record label EMI insisting:

"Nearly all the new media business models require a robust DRM solution to be successful. Microsoft's continued innovation and commitment to quality sound in Windows Media is helping us develop profitable new ways of connecting music fans with the artists they love."

And how did that turn out? Well, as we're increasingly discovering, very few new media business models require any sort of DRM, and in fact, DRM seems to damage business models a lot more than it helps them. And, Microsoft's forays into the space have hardly done very much in helping musicians develop "profitable new ways" to connect music fans to artists.

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Filed Under: business models, drm
Companies: emi, microsoft

14 Comments

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some old guy, 20 Jun 2008 @ 12:55pm

....
While I agree, the #1 new business model that came about was iTMS, and its STILL using DRM, and its currently the #1 seller of music.

So uh... I agree in theory, except... theory doesn't match reality. And I really wish it weren't so.
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Ummm.... Not exactly, 20 Jun 2008 @ 1:24pm

Re: ....
One of the things from ITMS is non-DRM music...which consists of much of their music.

I personally seek out no DRM or buy CD's and rip the MP3's just to avoid DRM.

There is nothing like losing your music collection because the people I bought the music from didn't trust me enough.

-Chris
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Anonymous Coward, 20 Jun 2008 @ 1:57pm

Re: ....
Why would anyone pay for music anyway?

go TPB
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Jake, 20 Jun 2008 @ 2:30pm

It's worth bearing in mind that in 2001, selling things on the Internet was a relatively new business model, whatever and however you were selling.
Of course, whether you could call resigning oneself to the fact that a certain amount of lost direct income was inevitable no matter how hard one tried to prevent it and settling in to make the best of things a new business model is questionable; didn't we go through all this with home taping?
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zcat, 20 Jun 2008 @ 2:53pm

iTunes is in a way anti-drm
From what I understand itunes only ever put DRM on the music because the record labels wouldn't let them sell it any other way.

It's always been trivially easy to get around, so much so that even Richard Stallman refers to it as only "Digital Inconvenience Management"

And because Apple won't license the technology, anybody who wants to sell music online and have it playable on the iPod has to sell it without DRM. (Although I think DVD-Jon has a workaround for this now)
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Mac Happy (profile), 20 Jun 2008 @ 3:57pm

ITunes and DRM
In order for iTunes to have the licenses it does have from the record labels they were required to have DRM. Only recently did some allow a DRM free version to be sold.

Everything is about making money though (can't blame them for trying). The record labels are not poor, but they are not making money like they used to, and that scares them. They refuse to update and change how the industry works and so technology has now left them behind. Personally I say screw them, they are an aging dinosaur, and unless they adapt to the new climate they are done for.
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some old guy, 20 Jun 2008 @ 4:56pm

Also for apple and DRM
Don't forget the other part of iTMS, the video sales and rentals category. That is 100% chock full of DRM, and the Apple TV is poised to give cable companies a very healthy run for their money. (buying episodes and renting movies is cheaper than basic cable, and its more convenient)
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Anonymous Coward, 20 Jun 2008 @ 5:25pm

Re: ITunes and DRM
"The record labels are not poor, but they are not making money like they used to, and that scares them"

Do you have anything at all to even remotely back your claim up?
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Time will tell, 20 Jun 2008 @ 5:53pm

hahahahaha
Plays for Sure
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Anonymous Coward, 20 Jun 2008 @ 6:15pm

Re: Re: ....
thanks for your support
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Lawrence D'Oliveiro, 20 Jun 2008 @ 9:37pm

Re: iTMS
I believe iTMS isn't actually the largest source of legal downloadable music. That honour goes to the ring-tones business, which is several times larger than iTMS.

OK, so iTMS is the largest source of complete musical pieces.

And of course, both of them would be dwarfed by illegal downloads.
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PaulT (profile), 21 Jun 2008 @ 3:41am

Re: ....
I think you'll find that Apple are the only people to have benefited from DRM. The reason is because it makes t difficult for the average person to replace their iPod with a different brand of player for fear of losing their music. It also made it virtually impossible for people with iPods to buy DRMed music from any store *except* iTunes.

Look at the history of the record industry, and you'll find that the major labels have been trying desperately to control the price of digital downloads. Apple had so much power in the fledgling industry that they're overridden these attempts. So, when music has started to go DRM free, they've not licenced DRM-free music to Apple but rather to competitors like Amazon in an attept to level the playing field. It's not working as far as I can see, because Apple's DRM-controlled store is too widely used at the moment.
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Anonymous Coward, 21 Jun 2008 @ 7:37pm

Re: Re: ITunes and DRM
its trivial to look it up if you don't believe it. just compare profits from one year to another.
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Abdul, 23 Jun 2008 @ 9:50am

DRM can be Good for the internet!!!
Whilst we may be tempted to brand DRM as obsolete and opposes the spirit of the internet, DRM can go along way in shaping up the internet. Tom Nolle, a ver renowned software engineer, in a very clear and explicit makes a case for DRM: The Case For Relunctant DRM (
http://www.internetevolution.com/author.asp?section_id=561&doc_id=144603&F_src=flftwo)
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