Dear Steve Jobs: Set the music free
To: Apple CEO Steve Jobs
From: Greg Sandoval, CNET News
Re: Acquiring DRM-free music
Steve, give us DRM-free songs for Christmas
(Credit: James Martin/CNET Networks)The iTunes music library is looking a little shabby these days. Look around, Steve: iTunes is the last great refuge of DRM-laden downloads. Is this the image you want for Apple?
More than 18 months have passed since you signed your one and only deal to acquire music free of copy-protection software with a major recording company. And that was with EMI, which accounts for less than 9 percent of U.S. album sales and is the smallest of the four top music labels. In the meantime, Apple has continued to wrap the vast majority of major-label music in Fairplay, the company's proprietary digital rights management software, at a time when your major competitors have already signed DRM-free deals with all the big players.
If you cling to this position, iTunes is going to look stodgier than that "PC guy" you're always mocking in your commercials. Zune offers more DRM-free music, signing agreements with EMI, Warner Music Group, and just this week, Universal Music Group, the largest music label. Steve, DRM inspires hatred from all the cybergroovies, many of whom swear loyalty to Apple products. It's time to dump this loser. Even the major labels have recognized this. I'll get back to that.
You now have a golden opportunity to make things right. I've heard about your negotiations with the three largest music labels about acquiring music unburdened by copy-protection software. My sources said that no deals are final but that one top label is closing in on an agreement.
Close them, Steve. Close all of them. I'm going to point out the obvious: striking these agreements would be good for Apple, the recording industry, and certainly for Apple customers.
DRM doesn't fit with Apple image
I realize cutting a deal takes both sides to agree. But you and the music industry have blamed each other for the absence of DRM-free songs on iTunes for more than a year, certainly since you published your now famous open letter of February 2007. That's when you called for the labels to abandon DRM. I'm sure you know music execs always laughed at this and suggested that your argument was a tad disingenuous. They said your DRM fit perfectly with your plans to lock customers into buying music that played only on Apple devices.
I think I can speak for your customers here. They don't care who's responsible. What really matters to them is that it's time to do more than write letters. You must recognize that the time is perfect for you to act. The climate surrounding digital music is vastly changed since you wrote that letter. The labels admit now their DRM strategy has failed.
Check out what Edgar Bronfman, the head of Warner Music Group, said earlier this month: "We're not technology companies...We never came up with a version of DRM that did what we needed it to do."
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Doug Morris, Universal Music's CEO, called you a friend and one the smartest men in music during a recent interview. Sounds to me like these guys are ready to deal. They must know that it's in their best interest for iTunes, the country's largest music retailer online or off, to have everything it needs to move music. Sure, they want iTunes to have some competition. They fear you will grab too much control over digital sales...again.
That's likely why all four major labels have provided music sans copy-protection software to your chief rivals: Amazon.com, MySpace Music, and Wal-Mart Stores. I'm not naive enough to think that's an accident.
But all the signs point to a music industry, at least with regard to digital downloads, that wants copy-protected songs buried.
Take away competitors' advantage
Just consider the benefits to Apple if you acquire DRM-free songs from the three largest labels:
• You snatch away the most important competitive advantage that any of your rivals possess. Amazon, MySpace Music, and Napster have been touting their DRM-free libraries. Amazon appears to be the only place where DRM is making much of a difference. The Web's largest retail store doesn't break out numbers, but in April, research company NPD Group reported that Amazon's MP3 service was showing signs of growth based on consumer sampling.
• You can give iTunes' tech-savvier customers peace of mind. Sure, they represent a tiny sliver of your customer base, but they're also the most vocal. They're the ones who have been calling for an end to Fairplay for a long time and understand that one day Apple could stop issuing DRM keys and leave their music stranded.
Remember, Steve, DRM schemes were proved to be anti-consumer this year. MSN, Yahoo, and Wal-Mart all made announcements that they planned to stop issuing DRM keys. They all were widely criticized when customers realized that without the keys, songs couldn't be moved to new devices or computers. All three capitulated. Sure, Apple appears to be an immovable force now, but who knows about five years from now? Fairplay is DRM and that means it's vulnerable to this key issue.
Do you really want to follow in this group's footsteps?
• Apple also will avoid alienating customers in the case that a company develops a popular music player that people can't play their iTunes libraries on because of compatibility issues. I've always said that in this scenario, Apple could lose a lot of good will.
Apple needs to prove the naysayers wrong and show that the company was never interested in locking customers into buying its music or music players. Apple has to show that it knows the best way to build an empire is to design products people want to play their media on--not players they have to play their media on.
Greg Sandoval covers media and digital entertainment for CNET News. He is a former reporter for The Washington Post and the Los Angeles Times. E-mail Greg.
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Don't you shills have any backbone?
Get real, and stop drinking the kool-aid. It is bad for you.
You mentioned Steve Jobs letter. Obviously, the ball is in the record label's court. They are the ones who will not allow Apple to sell DRM free music and they are the ones promoting antiquated mp3 technology out the door via sites like Amazon mp3.
They are trying to handcuff Apple in order to give other retailers more power.
Every CD I rip, I rip in FLAC and MP3 V0. Without spending $15,000 on stereo equipment, you really are not going to notice the difference in sound... and even then, when you start going into the high end audiophile gadgets, you will get shunned for digital format music.
In related news, I remember about two months ago, when a popular track was shooting up the charts but the record company refused to release it to iTunes, preferring to sell it through other outlets. Immediately some other group covered the track and released it on iTunes, and the *cover version* made it into the top 10 most downloaded tracks! People like the 99¢ model, and people like the integrated functionality of iTunes. There?s no way around it.
(That having been said, I?m personally boycotting Apple for other reasons, but the fact remains that they have the best system out there and, unless something changes, they always will.)
It's so clear - He hates his customers, business partners, and admirers.
That being said, I'm about to buy my fourth iPod and an Apple TV.
What? It fits perfectly! Apple has always tried to control every facet of its hardware, software, and content. That's why you pay a premium for their products compared to a similarly spec'd "open" alternative.
Just ask Psystar
This is par for the course for Apple. I mean, why the heck should the iPod be tied to iTunes? I know there are alternatives, but my mom doesn't (until I told her) and millions other don't
One of the problems with the Internet is that it encourages mob mentality, and rational debate is easily drowned out. This is *exactly* what has happened over the whole DRM issue, especially as it relates to iTunes where the restrictions are the kind of things that *most* people in the real world find quite reasonable.
It's a vocal minority on the Internet that is making a big fuss. Some of them have a legitimate philosophical objection to DRM, but a fair proportion are really just worried that they won't be able to indulge their selfish greed if DRM ever becomes strong enough to convincingly stop them. Not, ironically, that Apple has shown any signs of attempting to strengthen the restrictions on iTunes music to the extent that would be necessary to achieve that.
Edgar Bronfman had said at a conference in Asia last year that the record labels had made mistakes when it came to digital distribution and that Apple's example was the best to be followed for leading the right path. And yet we see Warner holding out on DRM-free music on iTunes. Apple isn't the hypocrite, Sony/BMG, UMG, and WMG are the hypocrites.
And you're just a moron that can't get his facts straight.
I'm sorry you didn't like the story. Everybody is jumping on me but I never said it was Steve's fault that deals haven't gotten done sooner. I'm just looking to Steve to do what's necessary to make sure the deals happen now. He's got the power. The labels look ready.
What's shocking to me is all I've heard from you guys for the past five years is how much DRM sucks. Well, Apple is one of the last places selling DRM-wrapped downloads. Just because Steve wrote that letter in 07 doesn't mean he was willing to make a good faith offer at the negotiating table. I'll stand by what I wrote. It's time for Steve to do more than write letters. Get us DRM-free music.
I'm quite sure if Apple would allow $0.99 downloads DRM free as soon as the record labels say it's ok. I have a feeling though they're looking for a little more money out of the deal than they're already making, and to that I say, beggars can't be choosers.
I know you want to stand by your story in the face of criticism, and I admire your persistence, but: seriously. You need to correct or retract this story.
It's widely known throughout the industry (and reported virtually every week in Billboard) that the labels, led by Universal, are intentionally: (a) sticking to the contract signed with Apple at the iTunes Store's birth in 2003, which mandates DRM, while (b) allowing Amazon and all other major digital music sellers to sell DRM-free music. They're doing this in order to foster meaningful competition to iTunes, as you imply (though not clearly enough) in your piece. Whatever you think of Steve Jobs, this is the labels' position, not his. They will. not. budge. Full stop.
That is, unless Steve Jobs agrees to some other things I suspect you won't like: variable pricing on popular songs; more full-album downloads with a la carte downloading blocked; the end of the 99-cent price point. If you think eliminating those structures are worthwhile in order to eliminate Fairplay, then by all means, write a followup imploring Steve Jobs to back down on those points. But don't naively, vaguely talk about Steve "doing what he has to do."
Dude, I'm no troll (check my byline at Idolator if you like), but this is shoddy journalism. You really need to pull back from the brink on this one. You're getting pelted for a reason.
-Chris Molanphy
Columnist, "100 and Single"
Idolator.com
After 30 years, the Mac OS still has only a 5% market share because early-on Jobs locked up the operating system, allowed only one source for hardware and made it too risky for third parties to create software for the Mac OS--while such software development flourished for Windows.
Jobs is playing the same game with iTunes. Lock out the competition. It's Jobs way or the highway for consumers.
Jobs thinks he is playing a smart game, but sooner or later consumers will turn on him as they did when they overwhelming bought Windows-based computers. Job is no genius, he has just been a proto-Yang.
Jobs locked up the OS... I said that. He is following the same MO with iTunes, a bad thing,
Locking up the OS seems to be working??? The OS has only a 5% market share after nearly 30 years! That's not success. Success is Microsoft having a 93% OS market share during those 30 years. It doesn't look like Jobs "genius plan" is working at all. He could have had the 93% of the OS (and hardware) market if he had opened things up as Microsoft did.
People are unhappy with iTunes because Jobs is playing the same game he has always played. Microsoft looks like open source pioneers in comparison to Jobs restrictive, proprietary, "customer be damned" approach.
I don't think their goal is world domination a la Microsoft. They want to make the best products possible and sell them for a decent price. They seem to be succeeding at that. Microsoft wants to dominate the world and has way too many heads without an ability to focus. This is obvious in the quality of the software and hardware they produce.
You don't have to rule the world to be successful. Also, I hear that while the majority of manufacturers are struggling to make sales and making cuts, somehow Apple is magically selling more laptops and has a butt-load of cash in reserves.
Cavaliers are/were the most popular cars in the US. Does that make them better or a better buy than a BMW or Ferrari? No it doesn't. Ferrari's I'm quite sure sell a lot less cars than Chevy did the cavalier, so it's not always about what's most popular. What's popular doesn't always make it more successful or better.
Bill Gates won the game and retired from day-to-day at Miscrosft. At least he is returning large portions of his billions to society through his humanitarian efforts.
As far as we know, Jobs his keeping his stack close to himself...locking down his money like he did his OS and his iTunes. Maybe it's an anal thing.
Macs, iPods and iPhones are ego-priced for Jobs worshippers. None are better than their competition in any way. Only the Jobs devotees think otherwise.
Your logic has a fatal flaw. You are making a case that the reason why the Mac OS market share is 5% is because Apple locked it up to just the machines they are making. Then you are applying that same concept to the iPod. The problem is that the iPod has a 70-80% market share (if not more). How can you apply the exact same argument to both and come to a different answer? For your argument to be valid, the result would have to be consistent to both. Therefore, the only logically conclusion is that your hypothesis is flawed.
To better understand the results of market share between Mac OS and iPod, you need to thoroughly consider ALL the variables that went into creating those results. There is no one silver bullet that can explain it (as you have just tried to do).
portorikan's logic is quite simple in regards to Apple's business model being successful. The purpose of a business model is to make a lot of money - success is defined by making a lot of money. Apple is making a lot of money.
So, um, wango, if you're struggling with that, it really would behoove you to look up the word "logic."
By the way, I gave him every reason right back to Sunday why I would want one.
So stop moaning to Apple and forward your letter to the labels.
So stop making a fool of yourself by directing your plea to Steve Jobs.
Actually, who hires reporters that don't know **** about the stuff they report about? CNet obviously!
Apple may push for abolishing of DRM, but Apple can't force it. Try to explain to Apple's stockholders (and the market in general) Apple threatening to drop one of the major music houses from the iTunes store and then losing that push and having to carry that threat out.
I appreciate you chiming in Chris. But my sources say that Apple is indeed discussing DRM-free music with the labels. If the music industry was interested only in helping Apple's competitors, why negotiate? I appreciate your concern though.
Those would be firsts.
As it stands, your letter only tells half the story. Even if you're proven 100% right (and, no offense, I seriously, seriously doubt any of the above), you're doing your readers a disservice not explaining how we got here. I don't deny Steve Jobs can be a jerk (and, reportedly, a nightmare to work for), but the deal points he's sticking to against the labels put him solidly on the good-guys side. Your story, as written, is woefully imbalanced.
Firsts at iTunes! Not firsts, period. Oy.
What do you guys think happens in these negotiations? Jobs throws in an all-expense-paid trip to the Bahamas to convince the labels to drop DRM? The labels want a giveback, and they want a big one -- something we've all taken for granted at iTunes lo these five years: 99-cent songs, downloadable album tracks, etc. It won't be something we'll be happy to live without.
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by disposableidentity
November 20, 2008 4:14 PM PST
- @DrtyDogg, he means that's the first time the record companies offered that to Apple in negotiations.
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by DrtyDogg
November 20, 2008 7:03 PM PST
- I guess we just disagree then, as I see it Apple needs that lock in as they have about the 3rd or 4th best player on the market. It's funny you mention MS as there store is primarily DRM free. It's not about assuming that Apple would use their iTunes lock in, it has been witnessed for years now, by not licensing fairplay, or removing DRM
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by disposableidentity
November 20, 2008 8:19 PM PST
- Apple has sold something like 150 million iPods but only 5 billion songs. About 30 iTunes Store tracks per iPod. Are you saying that 30 songs (about $30) is going to stop someone from buying a Zune or some other mp3 player?Apple has lots to gain by dropping DRM and selling more tracks -- the record companies are clearly giving the other stores a DRM-free head start to try to slow Apple's growth.
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by DrtyDogg
November 21, 2008 3:46 AM PST
- So. . . let me get this straight, you honestly believe that they are all trying to "punish" their largest supplier, even if it is affecting their wallets also? That is kind of like cutting off your nose just to spite your face isn't it?
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by dennisobell
November 21, 2008 5:42 AM PST
- DrtyDogg:
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by DrtyDogg
November 21, 2008 7:15 AM PST
- I've heard that argument before about flexible pricing. Yet we have flexible pricing at Amazon, and all that we've seen from that are LOWER prices. Same thing NBC said. they wanted to offer older shows at lower prices.
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by disposableidentity
November 21, 2008 7:21 AM PST
- Exactly. The record companies would much rather deal with a larger number of medium-sized, more or less equal distributors, instead of one dominant one. What's even worse from the record companies' perspective is that Apple has consistently used their position to get good terms for consumers, like 99c pricing, single track purchases, the ability to burn unlimited CDs, the ability to put the tracks on an unlimited number of iPods, the ability to play tracks on 5 different computers simultaneously -- all things the record companies opposed, and Apple had to fight for.
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by disposableidentity
November 21, 2008 7:24 AM PST
- Sorry. My "Exactly" was in response to dennisobell's comments, not DrtyDogg's.
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by disposableidentity
November 21, 2008 7:45 AM PST
- @DrtyDogg
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See all 69 Comments >>The simple fact is that Apple would benefit from DRM free music sales in iTunes -- and they know it. They have the best player on the market, at the best price, with the best distribution in place. Apple doesn't need to protect their iPod sales with any kind of lock-in. We're just so used to MS doing things like that, people automatically assume Apple would want to do the same. On the contrary. iPod sales are safe regardless, and Apple would sell a ton more tracks without DRM.
Steve Jobs' open letter had all of the Kool-Aid drinkers cooing about how that's what Apple really wants, yet while he was teasing you about it other companies went and did it.
Maybe I am a little biased though iTunes was the reason I didn't buy an iPod. I hated the program when I first tried it 5 years ago. I have it installed on 2 of my machines but that is just because it comes bundled on a Mac(Songbird FTW).
Believe it or not, yes, that's exactly what they're doing. They can't pull out of iTunes entirely -- it's now the single largest music retailer in the country.
But, for example, Universal under Doug Morris has refused to sign any new long-term contracts with Apple (unlike in the first three or four years of the store) and is providing new music to iTunes on a month-by-month basis. It's a somewhat empty threat, because no one thinks they'll pull out of iTunes anytime soon, but they continue to dangle that possibility. Since Jobs's anti-DRM letter of early '07, negotiations between the major labels other than EMI over any new terms have basically been at a standstill. Morris et al. (and some artists, most prominently Kid Rock) have openly said they want the power to charge more or less (mostly more) than 99 cents for certain hit songs, and they want the ability to designate scores of downloadable albums as "Album Only" purchases. Jobs refuses to budge on all that -- for which we should be APPLAUDING him.
Again, this is why Sandoval's letter, imploring Jobs to change his stance on DRM, is reductive and naive.
If Kid Rock wants to price hmself higher than everyone else, let him. We as consumers will speak with our wallets.
On another point. I work with a partner everyday that I don't like. But the bottom line is I'm not going to let my disdane for them affect my bottom line. Maybe I'm smarter than the record execs & SJ, I highly doubt it though.
Once again the record companies are cutting off their nose to spite their face. They are offering other stores amazing terms that Apple is not getting. Otherwise there's no way the Zune store could offer monthly all-you-can-eat subscription and still let you download 10 tracks per month for only about $15. Same with the "flexible pricing". Apple would not hesitate to sell older tracks for less -- it's in their interest (more cheap "blades" to help move their expensive "razors"). No, Apple's only concern is that the record companies would likely raise prices on new and hot tracks. Hey, it wasn't that long ago they were telling us a CD was worth $18, when you could buy a movie on DVD for less. Apple knows where the sweet-spot is to move music. In the music business it's pretty clear the best model is low prices, high volume. And yes, I do believe the music industry would use "flexible prices" jack prices and mess it up.
We know how Apple and the record companies split the 99c from iTunes, and there's not much left after the record companies take their cut. So either the other stores are operating at a severe loss, or the record companies are propping them up to provide some competitive pressure for Apple (most likely, both).