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In what is as close to a blog post as you’re going to get from Steve Jobs, Apple’s CEO outlines what will certainly become the company’s official stance on DRM: “Don’t blame us, blame the music industry.” The letter is a worthwhile read, but I’ve excerpted some of the juiciest bits below:

However, a key provision of our agreements with the music companies is that if our DRM system is compromised and their music becomes playable on unauthorized devices, we have only a small number of weeks to fix the problem or they can withdraw their entire music catalog from our iTunes store.

This is particularly interesting fact I didn’t know about Apple’s DRM scheme. This is certainly why they are so reluctant to release it to other vendors: the risks of loosing their licenses to the music catalogs are too great if someone leaks the DRM spec and cracks it. Then the whole world gets to pirate the iTunes store and Apple looses out on their rights to sell music in the future. Jobs realizes this and mentions it later. But the fact that he is disclosing this condition of Apple’s deal with the big 4 is news in and of itself — it is surely something he must not have been happy with from the beginning.

“On average, that’s 22 songs purchased from the iTunes store for each iPod ever sold.

Today’s most popular iPod holds 1000 songs, and research tells us that the average iPod is nearly full. This means that only 22 out of 1000 songs, or under 3% of the music on the average iPod, is purchased from the iTunes store and protected with a DRM. The remaining 97% of the music is unprotected and playable on any player that can play the open formats.”

Apple finally acknowledges that iPods are filled with mostly Mp3s. Jobs’ conclusion, however is ridiculous:

And since 97% of the music on the average iPod was not purchased from the iTunes store, iPod users are clearly not locked into the iTunes store to acquire their music.

3% of one’s music collection is certainly not insignificant when it comes to switching to another DRM scheme. Imagine if your car stopped working 3% of the time if you switched the gas station you purchased your fuel at. While it might be a small percentage, it is certainly enough of a disincentive to prevent users from switching hardware. Jobs is trying to absolve Apple of any wrong doing here, and I don’t buy it: vendor lock in is an attractive trait in any product for any publicly traded company tech company. Jobs hates DRM because he hates the music industry’s bullying over iTunes — if Mp3s suddenly only worked on iPods, I don’t think he’d be that upset about vendor lock in.

” Apple has concluded that if it licenses FairPlay to others, it can no longer guarantee to protect the music it licenses from the big four music companies.”

See above. Again, Apple is trying to place the blame on others for keeping secrets. If they weren’t known for their litigiousness over trade secrets, I’d take this a bit more seriously, but I still doubt Apple would have disclosed anything about their DRM scheme if the music industry didn’t stipulate this guarantee in their agreements.

“The third alternative is to abolish DRMs entirely. Imagine a world where every online store sells DRM-free music encoded in open licensable formats. In such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players. This is clearly the best alternative for consumers, and Apple would embrace it in a heartbeat.

This is what we’ve been saying all along. Perhaps Apple is scared of eMusic. Perhaps they’re waxing philosophical for a PR stunt; bluffing because the music industry would never go for it. Or perhaps they’re for real. I’ll wait for iTunes to start selling Mp3s.

“If the big four music companies would license Apple their music without the requirement that it be protected with a DRM, we would switch to selling only DRM-free music on our iTunes store. Every iPod ever made will play this DRM-free music.”

Indeed.

“… DRMs haven’t worked, and may never work, to halt music piracy. “

Something about pluralizing DRM seems awkward, but I agree.

“Perhaps those unhappy with the current situation should redirect their energies towards persuading the music companies to sell their music DRM-free.”

This is reminiscent of the Google vs. China debate. Why blame Google when China’s the real evil? Some information is better than none, and DRM’d music is better than no music. Except that in a world void of DRM, there still is music — on CDs, on p2p networks, and the web.

Apple exploited an opportunity to gain financially through the implementation of a scheme that unnecessarily encumbers the rights of users and musicians. They could have dug in their heals and kept selling iPods without a music store, and the music industry could have figured out all these painful lessons on their own. Now Apple is an accomplice and has cried wolf: why should the music industry listen to a company that has been profitably going along with their plan for so long? When everyone makes the switch to Mp3 Apple will appear impatient and rebellious, not staid and justified, as opposed to eMusic.

“Convincing them to license their music to Apple and others DRM-free will create a truly interoperable music marketplace. Apple will embrace this wholeheartedly.”

Good to hear that Apple will be ready and willing to hold their hand — and this is a great contrast to Microsoft’s official position on the matter, but it is not enough. As long as iTunes keeps selling DRM’d music the music industry will be able to point to the 2 billion tracks sold as justification for further support of DRM. Apple needs to offer them an ultimatum: no more by DRM by 2008 and we’ll make sure you’re handsomely rewarded in the form of much more business.

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This entry was posted on Tuesday, February 6th, 2007 at 5:35 pm and is filed under Links, News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.