Head of Yahoo Music suggests labels sell online without DRM

Even though Apple has succeeded in selling over a billion songs as downloads, the head of Yahoo music, Dave Goldberg reckons that music download services could do much better if only one change can be made - do away with the Digital Rights Management (DRM) restrictions!  The RIAA and music labels should give this a try.

At the moment, the reason Apple is doing so well is due to the majority of the market having an iPod, which is only compatible with the iTunes DRM.  Anyone who ventures to another music service will have to get a player that supports it and this in turns affects the music industry since they are more worried about protecting the music itself than its customer's experience.  This likely explains why Apple has around 80% of the music download market.  Yahoo is struggling like everyone else despite its very low cost unlimited download subscription service, mainly due to very few hardware players supporting its DRM.

If the labels were to do away with DRM, music download stores would be able to sell based on features and pricing without worrying about DRM compatibility or the playback equipment.  However, the RIAA and music labels are more worried about trying to tackle piracy with restrictive measures due to their misuse of DRM.  In fact, the only people they affect with DRM measures is paying customers, since it has no effect on consumers who get music from a file sharing services, since obviously this music would not have the DRM measures as the music from music download stores.  Thanks to wildaho for letting us know about the following news: our news submit to tell us

What would happen if all the major record labels had a change of heart and started selling music unencumbered by digital rights management restrictions? The head of Yahoo Music thinks it would be all good. Speaking at Music 2.0 (it's like Web 2.0, but with a beat), Dave Goldberg suggested that the RIAA and member labels give sales of non-DRMed music a try. Using the example of eMusic, which still uses non-DRMed MP3 files, Goldberg said that the current situation is causing problems for consumers. Different DRM measures result in incompatibilities between music services and digital music players (e.g., the iPod and every WMA-using music store). As a result, consumers end up being locked into a single service and music player, which ultimately hurts the industry. If the music industry wants to continue its online growth, it needs to pay more attention to the consumer experience. (further down...) Of course, the labels would have to agree to sell unencumbered music, and that's about as likely as a Chicago Cubs World Series win. Despite the obvious benefits to consumers, the music stores, and arguably the labels, the music industry is so concerned about the bugaboo of file sharing that it's unlikely to ever relent on the issue of DRM. However, the labels are losing sales because of their steps and missteps with DRM. As a Canadian record label executive commented, "why do you want to piss off the people who buy?" Apparently, the answer is because the labels think that if they give consumers no other choices, they'll buy anyway.

With virtually every popular album and single available somewhere on file sharing networks, the music industry would have nothing to lose by offering music free of any restrictive DRM, but a lot to gain from this.  For example, the Russian allofmp3.com site many music labels are against is doing very well and already proves that consumers are willing to pay for DRM-free music.  The advantage here is that they know what they get is pretty much guaranteed to be encoded properly, be the correct song and work with virtually any portable player they may have, particularly when it comes to getting a decent selection of songs. 

Unfortunately, the music labels start complaining and trying to find ways to shut down this 'notorious site' and anything like it, yet don't learn a thing about why many consumers would buy from these sites and not the DRM-crippled sites.  In my opinion, the music labels should give a DRM-free music service a try and publicise its compatibility with iPods and virtually any MP3 player (such as using TV commercials, web banners, etc.) and what see happens! 

wildaho added:  From the Ars Technica site. A momentary glimpse of rationality? Let"s see how long he can keep his job! I particularly liked their conclusions in the last paragraph.

Source: Ars Technica