David Emery Online

DRM Free

7 September 2006

In the last week or two, both Windows media DRM and also iTunes FairPlay DRM have been cracked, allowing users to strip out the DRM and convert them to other formats. The windows media crack has already been patched, and I imagine it won’t be too long before Apple patches iTunes as well; I guess we’ll get a new version on Tuesday, with the special event that’s occurring (which I’m going to – the London telecast at least). I imagine we’ll get the iTunes Film Store, along with at least new Nanos, maybe new normal iPods and a small possibility of something else.

However, going back to DRM for a minute – I think these cracks are a signpost that points to the move away from DRM. The main indicator, though, is MySpace’s announcement that they are enabling bands to sell mp3s through MySpace. Now, the deal for artists isn’t that great – from what I hear MySpace’s cut is $0.45 per song, which is more then what iTunes takes (about $0.35), so limits how cheap artists can sell their songs.

While the deal isn’t great, it’s still incredibly compelling – why would you not sell your songs, when it takes so little work and the return – thanks to MySpace’s huge audience – could be so huge?

The main driver at the moment for DRM are the major record labels – indie record labels on the whole couldn’t care less, they just want to sell their music. With the new MySpace proposition, the deal looks so good that it would be stupid for the majors not to sell their songs through MySpace – especially when everybody else will be doing it.

If they do that, they have to forgo DRM, and if they forgo DRM in once place, the house of cards tumbles and they might as well forgo it everywhere.

This also has a large knock-on effect. To start with, it would mean that the majors could get on board with eMusic. eMusic is the second largest online music store, and sells mp3s using a subscription model. They’ve got to their number 2 status – after iTunes of course – without any support by the majors, who won’t get on-board without DRM. Interestingly, eMusic is launching in the UK and Europe next Tuesday, the same day as the Apple event.

If anything is going to topple Apple’s dominance of this market – both online and with the iPod – it’s going to be this one-two blow of MySpace and eMusic, selling major-backed mp3s.