Lessons from iMeme

At 8:30 AM on Friday, July 13^th, I found myself at the “Lessons of the Digital Media Revolution” breakout session almost by default. I don’t listen to a lot of music, so the way the Internet is changing the music industry interests me primarily because of possible parallels to other industries, like print publishing. And, given the recent furore about changes in music licensing fees for Internet radio stations which has had many For Immediate Release listeners up in arms, this panel seemed more likely to be of use than the one on venture capital. (Neither the Asylum, nor my other two businesses, nor FIR, is seeking VC funding, after all.)

I found myself fascinated by the discussion of digital rights management, because all five panelists agreed that DRM is bad for the music industry.

Terry McBride, CEO of Nettwerk Music Group, argued that DRM is the reason there’s no one-stop shop for downloadable music. Record labels have deals with certain resellers, and you can’t play the songs you download through iTunes on your Zune, or the songs you download from Urge on your iPod. The music you pay for and download legally is far less portable than the music you download illegally, and where’s the sense in that?

Indeed, the trusty iriver I used to record the interviews I conducted at iMeme will not let me transfer MP3 files to my computer, even if they are DRM-free podcast files with Creative Commons licenses. I was not in the least amused when I discovered that, and it’s one of the reasons I use it only as a recorder and not as a player.

Rob Glaser of RealNetworks had it absolutely right when he said that DRM for digital downloads of music is “asinine.” As he pointed out, record companies have been releasing digital music in DRM-free form since the first CD was produced in 1982. (And we all know how well Sony’s experiment with building DRM into CDs was.)

What’s more, analog music was also DRM-free. When I was in high school, people used to make tapes from their vinyl albums and give them to their friends. Or even make tapes for their own use, to play in the car, or to create a dance mix for a party. Before I had a CD player in my car, I used to copy my paid-for CDs onto cassette so I could listen while driving.

Lauren Berkowitz pointed out that EMI realized they were in the music business, not the record business, and that their job was to “enable consumers to have proper access, to buy and enjoy their music wherever whenever and however they are.” This is what the people want, and what they’ll get, one way or another. We’re paying for the music, not the format.

I bought a song from iTunes once. (I told you I don’t listen to a lot of music.), Silly me, I expect to get an MP3 file. I got something called an M4P file, which I could only play in iTunes (since I use a non-iPod MP3 player). Generally speaking, I don’t want to be listening to music at my computer any more than I want to listen to podcasts at my computer. I promptly recorded the file into MP3 form and then put it on my MP3 player.

A client once bought me a copy of his e-book. I had endless hassles trying to get that document to open, to the point where my client called the CEO of iUniverse at home to get it straightened out. (And it was still inconvenient, and I couldn’t print it.) The argument for DRM in books is really no better than for music CDs; I remember plenty of fellow graduate students happily photocopying entire books—on the departmental machine, so they didn’t have to pay for it. And, of course, there’s the library, which makes it legal to read books without buying them.

DRM serves primarily to irritate and inconvenience the honest people who pay for your music, e-book, video, or whatever. Just look at the widespread use of “cracked” software if you don’t believe me. And most of the people with illegal copies of your intellectual property never would have paid for it in the first place. Even if you could make absolutely tamper-proof DRM, they would either do without or use something else that’s free.

Now, almost a month after the conference, Universal is about to join EMI in selling DRM-free music online. Neville Hobson, adjunct professor at the Podcast Asylum and co-host of FIR, argues that DRM will not go away because everyone on the planet is downloading illegal music.

I think—the panelists from iMeme think—it’s the other way around. DRM is one of the main reasons so many people prefer downloading music illegally. Unless DRM can get out of its own way, it’s only going to slow sales down.