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Thoughts on “Thoughts on Music”

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By Jeremy Horwitz

Editor-in-Chief, iLounge
Published: Tuesday, February 6, 2007
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Clearly designed as an official response to European governmental agencies that have recently threatened to force Apple to open up the copy protection system shared by the iPod and iTunes, Apple CEO Steve Jobs today published “Thoughts on Music,” an essay on Apple’s views of digital rights management (DRM), its sales of music, and its record label partners. Earlier today, I started to work on a detailed analytical look at the essay, but re-considered halfway through; as interesting as Thoughts on Music initially appears to be, there are only three modestly noteworthy points of interest to iPod users:

(1) According to Apple, the FairPlay DRM system was developed to satisfy the music industry, and Apple says that it’s willing to sell music without DRM - and guarantee that every iPod ever made will play it - if the four major recording labels agree that it’s no longer necessary.

(2) Over 90% of music sold in 2006 - virtually everything sold outside of the iTunes Store - was sold without DRM, in CD format, and that’s not likely to change.

and (3) Despite the prospect of licensing fees and/or forced governmental action, Apple is opposed to opening FairPlay to its competitors on the grounds that doing so will compromise FairPlay’s security. In other words, it will sell FairPlay music without licensing it, or sell DRM-free music, but that’s it.

Ultimately, the reason I opted to stop working on the full analysis was this: the essay ultimately comes across as more of a finger-pointing exercise than anything else, concluding by telling European governments to turn their attention to (European) record companies instead of Apple. The company’s proposal of two equally unpleasant alternatives - Apple DRM or no DRM - makes some rhetorical sense, but obviously doesn’t encompass all of the potential solutions out there, and as neither Apple option will satisfy sabre-rattlers, it won’t stop those trying to force FairPlay licensing upon the company. Additionally, even though the essay includes some questionable assumptions, such as the ones that only 3% of an iPod user’s library consists of iTunes DRM’ed music, and that 3% would be too small of a percentage to lock consumers into remaining iPod and iTunes customers, my guess is that Apple’s intended audience will find them more self-serving than convincing. Readers, what do you think?

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Comments

1

I have to say I agree with Jobs 100% on this issue.  DRM free music would be the best thing for everyone without a doubt, but short of that, the status quo seems to be working just fine.  I see no reason for Apple to license FairPlay to anyone else.

Posted by lancetx on February 6, 2007 at 4:58 PM (PDT)

2

Licensing FairPlay would allow all these new “on demand” video services to work with Macs (even if the record company’s cave in on the DRM point, DVDs do have DRM, and HD-DVD/BRD have increased that so I don’t see the TV/Movie industries agreeing with DRM-free content anytime soon), and that I would like… however I could blame Microsoft for not making their DRM compatible with Macs…

But I’m not blaming anyone; I’m just “stealing” the content. It’s cheaper, there’s no time limit, and the files are platform independent. Do I want to steal this content? Of course I don’t, but if that’s the only option available; I don’t care one bit that I’m not paying these guys for entertaining me when they wont let me pay for it anyway! Take Apple and Microsoft’s DRM out of the loop, and just supply high-quality content, and then you’ll have beaten (my) piracy.

Posted by Levi Pinder on February 6, 2007 at 5:49 PM (PDT)

3

I have purchased 112 songs (well, 112 songs downloaded from iTunes through promotions and sales) and have a library of 6531. So I don’t buy from iTunes very often. 3% sounds about right for me.

Posted by Epyon on February 6, 2007 at 5:50 PM (PDT)

4

Mmm…good point Jeremy. Record Companies aren’t likely to suddently drop everything and say: “Wow Steve, you’re right! We are kidding ourselves!”, even though Jobs is right for the most part in that DRM does next to nothing to stop piracy. Jobs assumtion that an average of only 3% of music on the average iPod is iTunes DRM music, and that even if the percentage were that small, which i suspect it’s not, people would or should be prepared to drop that music and switch music stores if they really want, makes me a bit angry. I posted a quick little bit of maths in the comments thread on the main page, but I’ll put it here as well…

Posted by Nuke666 in Melbourne, Austalia on February 6, 2007 at 6:30 PM (PDT)

5

Using myself as an example, there have been 4 iPods in my household which have all played music from my iTunes Store account. One of these ipods no longer functions, as I suspect a large percentage of all ipods purchased since 2001 don’t. I have purchased 389 songs from the itunes store, making up just under 11% of my 3357 song library. I have a 20GB iPod and a 30GB iPod, neither of which are full, so that’s 11% on two iPods. My sister’s iPod, which is a mini, is full with about 1000 songs, and i think about 200 of them came from the iTunes Store, making up 20% of her iPod’s content.

Using Jobs’ maths, my 389 songs would be divided evenly between 4 iPods purchased, leaving 97 songs per iPod, which would make up, hey presto, just under 3% of my primary iPod’s contents, or just under 10% of my sister’s iPod’s contents. We can therefore say that in my little sample, Jobs’ 3% equates to between 10 and 20% in the real world, when we account for purchased ipods that are no longer used, and multiple ipods that play music from the one iTunes store account.

I for one would not be prepared to give up over $500AU of music if I wanted to switch to say, Sony’s online store (lucky I don’t). Remember, using Jobs’ maths, only 3% of my music on my two main iPods, comes from the iTunes store. This particular point in his argument is really very weak.

Posted by Nuke666 in Melbourne, Austalia on February 6, 2007 at 6:38 PM (PDT)

6

I don’t even have 1% purchased music on my iPod, and most people I know are in the same category. So to me, Jobs’ estimate can’t be too far off the mark.

Posted by patz on February 6, 2007 at 6:50 PM (PDT)

7

Being an ol’ fart (53), I probably have more legal songs on my iPod than the younger set; I can afford to sit and download to my heart’s content, and .99 a pop seems reasonable to me.  My iPod currently has 2020 songs, 205 which have been purchased (10 percent), and probably 60 of them since Christmas (I got several iTunes gift cards).  So, Steve’s estimate of 3 percent is probably on the mark.

I really can’t see much room to argue with Steve’s message, although I wonder why Apple doesn’t sell some music - the stuff from indy labels that don’t want DRM - on the iTunes Store without DRM.  Maybe they could segment the store into “Open” and “DRM” categories, and let the market help “convince” the Big 4 of their foolish ways.

Posted by dave on February 6, 2007 at 7:04 PM (PDT)

8

in my itunes library i have 60 songs purchased….and about 2000 songs. or about 3%. most of my music came from the cds i purchased.  if i ever want to switch i’ll burn the 60 songs onto cds to take them with me.

Posted by lou on February 6, 2007 at 7:07 PM (PDT)

9

3% sounds about right.

Posted by Gordy. in Atlanta, GA on February 6, 2007 at 7:16 PM (PDT)

10

Out of 12,500+ songs in my library; less than 100 are from iTunes, and most of those are are the free single of the week (and some others where free from coupon codes) ... hardly a reason to hold me back should I want a Zune, or anything else.

Jobs can’t be far wrong when there are people like me driving down others’ 10 - 20% of FairPlay music. He obviously knows that the 3% doesn’t apply to everybody; it’s just an average; I think there was news recently of someone having spent $16,000 on iTunes?

Posted by Levi Pinder on February 6, 2007 at 7:23 PM (PDT)

11

I live in Mexico, I don’t have any other option but to purchase CDs and rip them off to my iPod. Imagine all the iPods sold in countries without an iTunes Store.

If the songs are sold without DRM, then maybe Apple could implement a global iTunes Store without restrictions. Then I’ll be spending big time on it! wink

Posted by Korpil on February 6, 2007 at 7:40 PM (PDT)

12

Steve raises some good points, but why don’t we just cut the crap and say it like it is and that is that illegal downloads happen because there is more content available that way, let me illustrate.
I live in australia but don’t have access to fantastic dance music from the west indies because the artist might be only on the french itunes store. The local CD shops don’t even bother to list some artists, therefore my only option is find it on peer to peer networks. There is a lot of music in the world and these online stores only have local content with local copyright which is indeed a label issue not an artist or apple one. I agree with the point above ie a global store.
DRM is fine, at the end of the day, itunes and ipod are doing the job just fine, there’s no need to change them. Can’t really complain, Apple has delivered a great system.

Posted by gab on February 6, 2007 at 9:09 PM (PDT)

13

follow up:

The logistics of shipping CDs are one which I thought would help online sales grow but since the stores only have the same boring content that CD shops stock, we don’t have access to the wonderful plethora of what is actually available. There are plenty of artists out there that are lacking true representation either by CD or online not to mention that other people other than americans watch “Lost” or listen to US music.
I think Apple should get involved with more labels in more countries and offer a world itunes store with a world class catalog. Music Labels need to see the future and that is that we don’t need them, they’re just fat off somebody else’s talent anyway. Or maybe they can stick around but remember that as humans we will always find a way of getting at what we truly desire.

Posted by gab on February 6, 2007 at 9:10 PM (PDT)

14

continued on:

I remember cassette days and that’s how we all discovered music, by making mix tapes for friends and parties. And this is the culture that the peer to peer networks are replicating. If we had the choice to obtain that music legally we would. That’s how it is.

Posted by gab on February 6, 2007 at 9:11 PM (PDT)

15

and finally:
I don’t actually see DRM as a problem, I see big music boss people worried about their house repayments. Apple, why don’t you split your store or flag the good stuff and see how we go, why don’t you sell some music for the rest of us.

Posted by gab on February 6, 2007 at 9:15 PM (PDT)

16

I guess Jobs is right in pointing his finger at the big four. At the same time, if he really really was all for a ‘no DRM’ world I think he would use some of his visionary and business smartness to try and make it happen. For the time being though, he’s just doing what anyone trying to make money would do:‘We aren’t the bad guys, we’re on your side consumers’

Posted by oasis on February 6, 2007 at 10:22 PM (PDT)

17

Here’s another twist. Living in South Africa I don’t have access to Itunes but I wouldn’t buy its overpriced and overprotected music even if I could. But I’ve paid for and downloaded lots of nice, un-drm discoveries from emusic. So, the score on my 60Gig, three quarters full iPod: ITunes: 0%, ‘stolen’: 80%, emusic: 20% and climbing, as I’ll be upgrading my account soon to download more, and cut down on sometimes dicy quality stuff from the networks.

Posted by jones on February 6, 2007 at 11:07 PM (PDT)

18

Whats the difference with buying songs from itunes store and burning it to CD than driving to a Wallmart and buying a CD.  Just because you buy songs from itunes dosen’t mean you are LOCK to iPod.  You don’t even need an iPod to buy song on itunes.  Just listen to it on your computer or burn to a CD and transfer to any format you want.  Its the convinience of being about to discover and download in the comfort of your home is what makes itunes secessful.  This arguement of itunes/ipod lock is weak.

Posted by Bach on February 6, 2007 at 11:16 PM (PDT)

19

I have 7757 tracks on my primary iPod and 0 of them were purchased in the iTunes Store. 7757 of them were bought on CD in regular or online CD stores. And as long as DRM exists, downloadable files are anything less than full 100% digital wav and costing almost the same as a full quality CD that comes with casing and artwork and can be played anywhere the only number that will change is 7757.

Posted by Ericc B on February 7, 2007 at 1:30 AM (PDT)

20

I have paid for 9 songs from iTS out of 3095 songs in the library.  I’m certainly not locked in.  Most teens I know who have iPods have not bought songs from iTS, they get all from owned CDs, shared CDs, and online file sharing.

Fairplay is not very sophisticated.  Compared to MS’ DRM, it is simple.  Apple bought it from Veridisc at the end of 2002 for its store launch in Apr 2003.  So I’m inclined to believe licensing would be a disaster - certainly Apple has to strike the out clause from its contracts if it was to do so. 

The real self-serving reason to dump DRM is that Apple wants to go further (wifi sharing, selling songs direct to player or phone?) but Fairplay’s inadequacies are a hindrance.  Zune has a real edge in DRM; as Bill Gates said, MS is working on making DRM more flexible to meet more usage models.

Posted by mark on February 7, 2007 at 1:32 AM (PDT)

21

I just find it kind of absurd for the EU to force Apple to break open its DRM to licensing is to satisfy other companies with lobbying power. This has little to do with the freedom of using your music the way you want to and more with greed. Steve’s proposition is fine by me.

Posted by gt on February 7, 2007 at 2:34 AM (PDT)

22

Reminds me of when I was a kid.  It’s late at night, there’s half a pie on the counter.  We’d all like to dig into it, but we don’t want to take the blame when it’s found to be gone in the morning.  Solution: send my brother, Joe.  He can be convinced to do anything, and then the rest of us can honestly answer “It wasn’t me.” to questions of who took the pie, all the while licking the sweet filling from the corner of our mouths.  Apple benefits from the DRM, too.  Steve tells the EU that digital music makes up a small percentage of sales, but also tells MacWorld about the continued and increasing success of the iTunes store.  I imagine it does help Apple to keep the music locked to the iPod.  If 3% of my 7,000 song library was from iTunes (it’s not, but we’ll use the number Steve gave us), then that means I’ve sunk about $210 into iTunes-only music, or almost the cost of a player.  Now you’re in the market for a new player, and if you add that $210 price tag on to any non-Apple product, all of the sudden Apple’s gone from most expensive to most affordable.  I’m not saying that Apple wouldn’t drop the DRM if the record companies okayed it, but for now I think Apple is very happy to point a finger to the record companies and say, “It’s all them!”  All the while counting their profits from repeat iPod buyers.  Steve’s point are valid, and I think DRM free music may be on the horizon, but I don’t know that Steve is our champion in this.  I think he just sees which way the wind is blowing, and wants someone else to take the brunt of it.

Posted by Rob E. on February 7, 2007 at 8:31 AM (PDT)

23

Unfortunately Apple’s situation is untenable.  Too many powers that be are afraid that the music and content revolution that Apple started with the iPod will be dominated by Apple.  Therefore, Apple’s empire must be dismantled brick by brick.  Smaller minds will be put in charge and ultimately we will be faced with bewildering trade-offs and stumbling blocks, not to mention higher cost.  The options scandal and EU actions are all to parts of this one goal.  They mean to bring Steve Jobs and Apple down.  I have no great love for either, but I do acknowledge genious.  The only answer is DRM-free music.  Apple has made it possible make iTunes music DRM-free and playable on any platform. That’s all they owe anyone.

Posted by audioguyBOB on February 7, 2007 at 10:45 AM (PDT)

24

I’m all for Steve’s no-DRM option, but I don’t think he’s being completely forthright: As Jon Gruber points out on Daring Fireball, there are “indie” record companies out there who are willing to go DRM-less, but Apple has thus far not obliged them.

More anecdotal data about how much music on an iPod has been purchased from iTMS: 91 of 5402 tracks on my iPod, or roughly 2% (and most of those were promotional items). Like others, I might buy more from iTMS if I had my choice of sampling rates—128 kbps just doesn’t do it for me. Maybe moving to no DRM would facilitate iTMS’s implementation of choice in this area?

Posted by orgel in Falls Church, VA on February 7, 2007 at 4:35 PM (PDT)

25

Jeremy,

I agree with your summation in regards to Jobs’ no-DRM essay; it does seem like finger-pointing, and it really seems as if Jobs is saying the ultimate fault for Apple’s business model lies with the content providers themselves. Touting a DRM-free world does push the right buttons with consumers, but who’s kidding who? The music labels aren’t likely to give in to this sort of public relations end-around without getting some sort of assurances that they’ll be able to maintain some level of control over access to their product. They have their own livelihood to protect. It’s easy for Steve Jobs to proclaim a ‘perfect world’ where DRM wasn’t attached to music downloads, but it sounds like there are EU members that already see how transparent the veneer of the essay really is. That said, it still truly would be a better world if people didn’t have to deal with the barriers set forth by DRM. Kudos to Jobs for saying the right things to customer, even if it may not amount to anything tangible in terms of progress.

I do take a bit of an issue with your comment on CDs and what feels like some downplaying of the influx of DRM into that format. Even tossing aside the Sony rootkit debacle, copy-protected audio CDs are more common than you’ve presented in you posting, particularly overseas. Here in North America, protected music CDs are less common but they do exist, though it’s typically targeted at Windows-based computers. As to how much this really affects your 90% figure—well, that’s anyone’s guess. But it’s somewhat safe to say that even with audio CD content the concept of interoperability has been called into question when it comes to ripping content into DAP-friendly formats.

As for me: out of 22,200+ files in the digital library so far, only about two dozen were purchased off of iTMS, and that was only because the songs were iTMS-exclusives, or the original CD is no longer in print. As for burning such content onto audio CD and then re-ripping into another format…the CD itself was tolerable from a SQ standpoint as long as I tell myself to not be all that critical (easy to do in a car with lots of road noise), but the MP3s for my iRiver and the Gigabeat S with a good set of cans weren’t worth the effort.

Posted by flatline response on February 8, 2007 at 4:14 PM (PDT)

26

the RDF field doesn’t have as wide a range in essay form. obviously this is a self-serving viewpoint, and clearly a reaction to what Apple must see as a legitimate attack on their business. i don’t think it’s unreasonable to believe that he might convince people, however. the argument is self-serving, but that doesn’t make it incorrect (at least the part about DRM being anti-consumer). the discrepancy i don’t see addressed is DRM with regards to video…

Posted by mrfett in Washington, D.C. on February 12, 2007 at 5:14 AM (PDT)

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