Apple's ulterior motive for unlocking music?
Fortune's Brent Schlender writes:

Steve Jobs is calling on the recording industry to unlock music and set consumers free. Why now? Could it have something to do with the iPhone?

So Steve Jobs has written an open letter to the world, suggesting that it's time to do away with the Digital Rights Management (DRM) technology that locks up downloaded music from being played on competing digital music players, such as Apple's iPod, Microsoft's Zune and a bevy of others. How magnanimous. But before you take what he says as gospel, you have to ask a couple of questions: Why? And, perhaps more interesting: Why now?

Let's take the first question. Apple is already the obvious kingpin of digital music players and digital music downloads. It's not as if either the iPod or the iTunes Music Store need more competitive leverage to succeed in the marketplace. Besides, the iTunes Music Store has by far the widest selection of music available for download.

Nor, as Steve points out, is it difficult for users to find other ways to import music into an iPod than simply via the iTunes Music Store. Remember "Rip, Mix, Burn," Apple's early marketing mantra for using iTunes to import CDs into a computer? Well, all any iPod user has to do is "Rip, Mix, Sync."

He contends that 97 percent of the music in a typical iPod isn't DRM protected anyway. Moreover, it's true that adding a layer of DRM is a technological headache and anything but bulletproof. So yes, it would be more convenient for everyone if all digital files could be played by any player or any other digital device. But where's the customer clamor? There must be another reason.

So let's go to the second question - Why now? Especially now that Apple is trying to develop a market for rock videos, TV shows and even movies, how does doing away with DRM for music give video content providers any comfort that their downloaded shows won't be even riper for online bootlegging? That nascent market for video downloads is still unproven, and besides, distribution technology is still a moving target. It’s not unlikely that both wireless and broadband bandwidth will soon be sufficient to simply stream video content in real time, rather than require viewers to acquire it, store it and then play it back.

Most intriguingly, what about the timing of this manifesto in relation to the announcement last month of the iPhone, a device that is primarily a Web-enabled media player? From the get-go (once it goes on sale this summer), the iPhone as it is currently described will be prevented from directly downloading music or video itself, even though it is a wireless broadband-capable device. To get songs or shows into the iPhone, you still have to tether it, via a docking cradle, to a Mac or a PC even though it easily should be able to handle this task all by itself. Something here doesn't compute.

Jobs himself says the "rub" really comes down to its licensing deals with the content providers - the big four music companies, and the TV networks and Hollywood studios. "Since Apple does not own or control any music [or video content] itself, it must license the rights to distribute if from others."

Indeed those licensing agreements are very restrictive, but it was the best deal he could get at the time. Now, however, Jobs is in the catbird seat, at least in terms of doing the best job of demonstrating and delivering to the world a complete digital music and video buying and consuming experience. He's proven the concept, and made it cool. Except for that last link from the new iPhone and other wireless/network-savvy personal digital entertainment devices to the online content stores, that is.

So the real question may be this: Could Jobs' eloquent plea on behalf of consumers all be a gambit to force Apple's content suppliers to renegotiate their deals and make it possible to download music and video directly onto the iPhone? After all, the iPhone certainly has the wireless capability and the processor smarts to handle such a simple online transaction. And Apple has the iTunes Music Store ready to do business.

I wouldn't put it past him.
Posted by Deirdre Terry 2:49 PM 76 Comments comment | Add a Comment

could this have anyting to do with the iTunes court cases in Europe. if there was no DRM on iTunes wouldn't that make the court cases against Apple mute?
Posted By tom rusch, sherman oaks, ca : 3:13 PM  

On one of the podcasts I listen too (i think it was CNET Buzzcast) they made mention that now that Apple secured the naming deal with Apple Corps that could pave the way for Apple to becoing the new owners of content (i.e.: signing direct licensing deals with artists, etc.) Honestly, I think this is Steve putting forth an effort to make this digital download experience more consumer friendly. It'll ease alot of headaches for everyone if they actually just removed all these silly restrictions
Posted By Matt, Philadelphia PA : 3:52 PM  

you can't fault a guy for trying to make a buck. especially when we all get to benefit from it.
Posted By ilovesteve, diamond bar california : 3:52 PM  

In short, I think the problem may relate to Apples DRM software technology. Perhaps one reason Jobs wants to ditch it is because it doesn't work and they don't know how to fix it. I ran into a problem that destroyed all 5 gigabytes of my iTunes library, the majority of which was ripped from CDs. The problem started when I updated iTunes to a new version - but it might also be related to my having copied all of the library files from my old C: drive to a new D: drive so I could reformat and reimage the C: drive. Despite many hours of effort on the phone with Apple, they utlimately refused to find out why my files won't play on the iPod when the iPod is disconnected from a computer but WILL play when it is connected. I think the fact the files are copies and that the new version of iTunes may not be able to recognize them as "authorized" lies at the root of this. I found that none of the Apple techs, even up to the 3rd level techs, could not or would not address this question -- they assume hardware problems where there are none, ignoring software as the root cause. Maybe Apple's software is the reason.
Posted By Ed Burke, Bethesda, MD : 3:53 PM  

It might make the court cases Moot, but certainly not Mute.
Posted By Dave McPhee, Chicago, IL : 3:59 PM  

you can slice and dice his comments all you want, but there's no two ways about it. the man is a visionary genius that actually cares about developing products that make people's lives easier. the Apple premium ($) is actually just the true cost of paying for hardware and software that's worth a damn.
Posted By david, providence RI : 3:59 PM  

"But where's the customer clamor?"...have you been hiding under a rock DRM is every music lover and audiophiles worst enemy!!!! Yes iTunes downloads play on my iPod but i can put them on my phone, or on a new non-Apple DAP which i will soon be upgrading to... know the industry before you write an editoral!
Posted By Don, Bay City MI : 3:59 PM  

I was under the impression that iphone is also an ipod when it comes to playing music and video. If that is true, your argument doesn't apply.
Posted By annamanni, oakland, ca : 4:00 PM  

It's a gesture, a PR thing.
Posted By Cool dude : 4:00 PM  

The problem with downloading direct to phone is that there would be huge tcom services charged for this. It's still the smart thing to store all the audio and video on the computer and sync to that, not use you iPhone as the main or only source for any files.

Or, do you just hate Apple and begrudge them their success? iTunes is the only DRM that stays out of the way, and is not about platform lock-in. It's about as simple as one could hope. If you can operate a toaster, you can get around the DRM just fine. I think Steve Jobs knows this, and doesn't want a bunch of windows biased geeks pushing their government reps to a point that is totally unwarranted (the entire european legal challenge to iTunes is misguided).

If the Norwegians take Apple to court on this now, they will look like total morons, as their case is completely indefensible. The other DRM 'solutions' (microsoft, real) are much worse.
Posted By Brian P. Muncie, IN : 4:02 PM  

Yes, he's calling for the end of DRM to deflect the European court cases, but it's cost-free for him, because he knows full-well that the record companies won't agree to it.

But Jobs would be OK with it if they did because the iTunes store isn't really a significant profit center--it's just there to help sell iPods. At this point, people buy iPods rather than other players because of the whole economy of iPod compatible accessories that depend on the proprietary iPod connector and iPod hardware protocol. Want a boombox that docks with and controls your MP3 player? How about a car with built-in MP3 player controls? If so, you have to buy an iPod, not another player.

People think the lock-in is the iTunes store, but it isn't -- it's the iPod connector and protocol.
Posted By Mark Weaver, Ann Arbor, MI : 4:03 PM  

DRM is a horrible idea FORCED upon consumers by the RIAA/MPAA period. It goes against all consumer rights of Fair Play and is needlessly restrictive. It is not the tech companies responsibility to protect RIAA's dying business model. Steve is telling it just like it is and fortunately for the consumers can garner media attention with his comments. MS Vista is built around DRM and that in the end will be it's downfall. Consumers have the right to do whatever they please with the products they purchased, period. And just in case anyone has forgotten the fact that in the US consumers have the right to backup or copy any media they have purchased by law. DRM is trying to circumvent our rights.
Posted By Stormkrow, Dallas, TX : 4:11 PM  

I think the timing of this plea has very little to do with the iPhone and everything to do with the pending cases in Europe. Since the iPhone runs an embedded version of OS X, there's no reason why Apple couldn't include iTunes, enabling users to purchase music from the phone. The drawback there is that the software itself takes up valuable storage space.

Better still is to treat the phone like another iPod - dock it periodically to charge and sync. There would be no further restrictions by the "big four" preventing that.

I still have a tough time with the European countries penalizing Apple because of their DRM. Yes, I'd prefer that they could get rid of DRM and make the various music stores more open. But in Apple's defense, there was never an intent to deceive. People know what they're buying on iTunes Music Store and they still buy millions of songs. After I buy the song, I really don't have a right to demand that the song I bought play on another MP3 player. Can I go back to EA Sports and complain that the Playstation version of Madden Football doesn't play on an XBox?

It took a lot of work to get the big four to even agree to sell music online. It's going to take an equal amount of work to convince them that DRM has to go.
Posted By Jeff, Indianapolis, IN : 4:11 PM  

Do you seriously think Apple couldn't put FairPlay on an iPhone? The idea that it would be a barrier to them is almost ludicrous.
Posted By Steven Fisher, Langley, BC : 4:14 PM  

So he has identified a business model which is unsustainable and doesn't work anyway and said that it is all those things. If that model were ditched, his company (among others) would benefit. To identify dead weight and try to get rid of it is just business sense.
Posted By Yuri, Boston MA : 4:33 PM  

The real problem is DRM in general. The Record, TV, and Movie companies need to learn to trust their customers. Yeah sure, you say. Oh yeah, if they provide value we will. This is what Apple, the IPod and Macintosh is all about. For example, I’m a “Who” fan. I’d buy everything The Who ever did for a hundred bucks, if it was convenient. Go into ITunes, select “The Who” and in a few minutes all their albums on my hard drive. Burn a CD for a road trip, no problem. Listen on my home stereo, piece of cake. Now look at the reverse: Think I am going to go to a CD store and buy $100.00 worth of Who CDs.? No chance.

Looking toward the future: Hear about good movie? – Ten Bucks, view it on the computer, burn to DVD, put it on a IPod: No problem. I’d download 20 times more movies then I’d ever go see at a movie theater. The pause button here is what matters.

The power, storage capacity, and indexing capabilities of computers today trump everything else. No DVDs, CDs, or tape cluttering up the living rooms anymore. No one wants to trip over five different DRM methods or think a Media Company thinks you’re a thief.

Trust your customers, provide a good value, and you’ll do well. Pound a square peg through a round hole? I don’t think so. This is very simple.
Posted By Richard, Woodstock, GA : 4:37 PM  

The motive you suggest it totally off base. Check out this article reguarding the iPhone and DRM

Brent Schlender is getting paid far too much.
Posted By Evan Reiser, New York NY : 4:40 PM  

Posted By Duhg, Athwype, MF : 4:41 PM  

Jobs goes out of his way to make everything the way he wants it and makes you think you want it to. There are no allowances for the inidiviual modification or personalization of anything apple if you can't change it you don't ever find out there are better ways to do things. Figuratively, you must match the apples on the tree. He only concedes when he is loosing popularity, poor him. As much as DRM sucks i hope they retain it to give him a piece of his own medicine.
It is also unethical to diswade people from upgrading OS products because apple is to slow to upgrade itunes to work with vista.
Posted By john nyc nyc : 4:55 PM  

I find it impossible to believe that Brent Schlender has not heard of Apple's troubles in the EU. The new release from Job's would have you believe that Apple would drop the DRM in a heartbeat if the content providers would let them. He hasn't iphoned his company about his feelings though, because Apple spokeswoman Natalie Kerris said that the move by the EU countries amounted to "state-sponsored piracy." She added that "Legal music sales will plummet just when legitimate alternatives to piracy are winning over customers."

Please check this article out

iPhone and DRM
Posted By Jeff Cohen, New York NY : 4:57 PM  

I think it is more likely this gesture is an attempt to build up resistance to the DRM features built into Microsofts Vista.
Posted By Aaron, Philadelphia, PA : 4:58 PM  

Once the case is moot, there wouldn't be anything left to talk about. Wouldn't that make it mute as well?
Posted By Phil Holmer, Riverside, CA : 5:06 PM  

The sales of Iphone will be nothing compared to IPOD sales. Just compare normal cell phones to expensive smartphone sales. Smartphones are almost nothing as a percentage of all cell phones. Plus those smartphones are a lot less than $600.

So he must be doing it for something that helps IPOD sales.
Posted By Frank, Chatham NJ : 5:16 PM  

Microsoft just spent years developing rights management within Vista and created a nightmare for users to upgrade. Legal DVD's won't play now. Legal mp3 files expire. If Apple could render that technology obsolete and further differentiate their platform from Microsoft as the multimedia solution what a win.
Posted By Russ, Cleveland, OH : 5:26 PM  

It has been a mystery to me since owning an iPod (3 years now) that I can put any music onto the iPod from iTunes Music Store or eTunes or from CDs, but I can't get them off of it. When I import music into iTunes from whatever source, I burn a CD. That CD will play anywhere. But once the music has been transfered to the iPod, it can be listened to but not copied from the iPod to anything, including back to my own hard drive from which it came. So, the iPod is a storage device for digital music, but only for playing back.
If FairPlay were removed, then my iPod would be more useful to me.
Beyond just me, it seems that it would be a technological headache removed for all providers(and consumers) of digital music. Especially, since the step of burning a CD makes DRM for the most part, inconsequential.
Posted By Mark, Dearborn MI : 5:26 PM  

Posted By CHUCK, SAN FRANCISCO, CA : 5:42 PM  

One other point - if digital music were DRM free, one clear result would be that artists who were either unknown, less mainstream or not backed by a major label would receive far more exposure. Stated differently, who wants to take a flyer on an artist they know very little about at $10-16 an album as opposed to non DRM music files which would allow consumers to download music their friends and others have and then buying music from artists they discover they liked. As much as DRM is there to protect profits, one enormous consequence (and maybe intention) is that it allows major corporations to decide which artists' work should receive exposure and which shouldn't. In the day and age of the internet where consumers want as much choice and flexibility as possible, DRM is extremely shortsighted.
Posted By Joe, Andover, MA : 5:44 PM  

yeah thats why i switched to media monkey.. the whole itunes software is very unstable because of drm... and vista .. don't get me started, sounds like big brother gates, perhaps this is the reason for jobs writing the letter... all the work put into vista drm base will be useless. hmm what would be the impact?? thoughts?
Posted By toast, boston, ma : 5:49 PM  

This article is reaching, at best. I guess we all need to make money somehow. You know, we are an innovative species, with niches in professions that allow for most problems (legal, technical, etc.) to be solved. Most certainly the issue you've conjured in you article is manageable. Has it ever occurred to you that in your limited knowledge as a journalist, you could perhaps be dreaming up conspiracy theories about a pop icon company in order to fulfill some quota and attempt to make a headline? Some professions I will never understand.
Posted By nicholaus, berkeley, ca : 5:52 PM  

Why is it that anything DRM with the iPod and iTunes is big news? I honestly think they should get the record companies to get rid of it all. In addition us living in the Linux/Mac OS world needs a much LOUDER voice with other DRM restrictions that we face every single day. Windows Media DRM is much more of annoyance as the DRM media files using the Microsoft DRM is not playable by Linux or Mac OS. Sure Microsoft could license the technology to Apple and force Apple to fork over bucks for it and they could find a way to incorporate it into iTunes, this I am sure. However Microsoft does NOT give people a free player that can handle their DRM'ed music, Apple does. Apple has iTunes for the Mac and Windows platforms (come on Apple give us a Linux version). Originally iTunes was only for Apple's MacOS however they created an iTunes for Windows.On the flip side Microsoft has dismantled the Windows Media Player on the MacOS and has never really supported DRM'ed content. Now Microsoft say use Flip4Mac which still can not handle DRM'ed content. I know more people using Windows who gripe about the DRM that Apple has had to impose but never realize the same type if not more stringent restrictions set by Microsoft's own DRM technology. My 2 cents
Posted By Chris, Columbia MO : 5:52 PM  

This article was stupid... the iPhone being the reason... Please! Their is one reason for this, he is trying to pass the buck/blame from his EU cases. He wants his EU cases to go fight someone thats not Apple
Posted By Jimmy, Chicago, IL : 5:55 PM  

I would surmise that as some people suggested, this is an attempt to deflect what European countries are complaining about.

Namely, European countries want iTunes songs to play on other devices. Such a scheme could obviously work; MS PlaysForSure already does this type of thing, as does the DVD Encryption scheme(plays on any player that licenses the security scheme).

However, Apple has gone out of its way not to do that. An obvious defense is to say "just remove the DRM." They know that's a decision of the copyright owners, not them, so they can say "we're only using this DRM because we have to."
Posted By Mark, Chicago, IL : 6:16 PM  

Posted By XJN DVR , Athens, Georgia : 6:30 PM  

Apple Inc. and Apple Corp. recently ended their thirty year old litigation. Apple Inc. may be ready to become a music industry player.
Posted By Errol, Brooklyn, New York : 6:32 PM  

Why? And, perhaps more interesting: Why now?

Who cares? I'm glad someone with a bit of actual clout is finally making the argument, period. DRM is a useless scourge that we should never have had to deal with in the first place.
Posted By wayne, atlanta, ga : 6:33 PM  

I have not bought an iPod yet because of the DRM horror stories. If Apple opens up, I would surely consider it. Jobs begged the Big 4 for distribution rights before, now it's time for pay back. Either the Big 4 open up, or make room for number 5 - The Apple Music Label. DRM - Defective By Design.
Posted By Ramond, Milwaukee, WI : 8:00 PM  

The primary points of his letter have already been pointed out, but let's put some perspective on things here...

The assult on Vista is undoubtedly hidden between the lines here. That's all Apple has been doing for about a year. Instead of promoting their product, they're trying to make the other players in the game look stupid.

The court case overseas - who really gives a crap? Apple doesn't. It's just another buck - if they lose money, then they can report it as a loss, and profit from it.

DRM itself is INDEED a bad attempt at protecting someone elses dollar by manipulating the law.

Can we copy a videotape? Yes.
Can we copy a vinal record? Yes.
Can we copy a BetaMax (don't laugh) tape? Sure!
Can we copy a CD? You bet.
Can we copy a cassette tape? Yep.
Can we copy a Reel-to-Reel? If you really wanted to, then sure.
Can we copy a DVD? According to our rights, yes. According to the RIAA? No.

Hell, you can RENT a movie, and by law, you're allowed to record! As long as it's not for distribution and you're not going to present it commercially.

Now - look at his companies perspective. The DRM causes Apple and Microsoft, and every other business in the business to employ developers. These developers are guided be an entirely new department (for DRM and other legal stuff) which on the bottom line, costs Apple and whoever else a WHOLE LOT MORE than they want to spend to do nothing other than piss off their customers.

I'm not an Apple user. I'm PC for life. However, the more Steve's that send out this message, the better. We have a right, and DRM has found some twisted way to circumvent our right. Steve is right.
Posted By Justin, Houston, TX : 8:08 PM  

this is a copy of another article I read yesterday, can't people come up with new theories... by the way it is about the europe mess of course
Posted By John Planfield, IL : 8:52 PM  

Or Jobs is setting up Fairplay to become a defacto standard forced upon us by the labels.
Posted By Joe, Albuquerque, NM : 9:16 PM  

Great idea. Just close down your business and give it away. I'm shocked that the business owners can't accept that they don't own anything. Just lay down and die.
Posted By gw, dayton, ohio : 9:16 PM  

Brent, you are an idiot. The restrictions on the iPhone come from the carrier not the Labels. It is more likely that Steve was just sick of being portrayed as wanting DRM as opposed to NEEDING DRM.

Ed Burke - You're are wrong too. If you ripped music didn't play it had nothing to do with authorizing, because there is no DRM on it.

Stormkrow - Wrong, Wrong!
1) There are limits to what you can do with the music you purchase
2) DRM does not stop you from backing up your music library.

In a perfect world people who use something would pay for it so that others don't have to subsidize them. DRM can be inconvenient but so can locks on Doors, but I'm not getting rid of those. The labels have to determine if unprotected music is enough more appealing that the sales will make up for the theft.

Make no mistakes, Apple is in this for the money but because being consumer focused is good business, somethings they do the right thing.
Posted By Doug, San Diego, CA : 9:34 PM  

Apple and for that matter MS are going to find them selves between a rock and a hard place. With Europe calling for an end to DRM and wanting Apple to open up their music, then it would be to Apple's advantage to look like they want to do away with all DRM. By calling on the Music companys to do away with DRM, then it looks like Apple is trying to do as the Europeans want. Apple can now go back to Europe and say. If you want DRM killed, then talk to YOUR Music companys. We will be happy to do it. We are just the middle man here and will be happy to be as flexible as they will LET us be. DRM was just an interim technology untill it was proven by the market place to unneeded. We will be very happy to kill our DRM technology( and consequently set a precident in a market which WE mostly lead), BUT, it is up to you to make the music industry HELP us and for you to kill ALL OTHER DRM OUT THERE(level playing field)!
As for Microsoft, it will remain to be seen if they would get onto a bandwagon that would once again turn LOTS of their (already spent)money and time into wasted effort. They will now be seen as a Music Industry Kiss-a@@ by not saying hell yes to killing their own DRM as well(once again Apple will be seen as leading and MS following- sorry Bill). MicroSoft is not making any money for all the Million$ they have spent on the Zune, and this would just insure more of their money down the rat hole in a market they are not even hitting on one cylinder in.
No matter how it turns out, it will work to Apples advantage and to MicroSofts widening disadvantage.
So Europe: Are you going to help Steve out maneuver Bill once again?
Posted By jan swesey, Richland, WA : 9:38 PM  

So, I guess Fortune nixed that niggly little requirement that authors actually know what the hell they're writing about, eh?

No customer clamor? Get real.

"Broadband" on iPhone? Heh. Type four letters into Google: "EDGE"

Gambit? Gawd. There's nothing to stop Apple from doing wireless delivery, if they had a bigger pipe. Ref. "AirTunes" and "AppleTV".

Whoever wrote this, here's a math problem: Take the download size of a movie on the iTunes Store, divide by the real-world bandwidth of EDGE, and tell me what you get -- while keeping a straight face.

(Heavy sigh)

Kids these days.
Posted By John, Seattle, WA : 9:46 PM  

It's interesting that all the writers are looking for some ulterior motive rather than just accepting the obvious. DRM is a pain for the users and for Apple. It hasn't solved a thing piracy wise and is constantly broken by the hackers. My wife has an iTunes account as do I so to freely get my music to her and have it loadable to her iPod I have to burn the disc to strip the DRM and then reload it onto her computer. Easier just to buy the CD in the first place and rip it on both. The rub for the music industry is that I would buy a lot more music period if I could just buy it from Apple without the DRM. I just don't make the same kind of impulse buy from Amazon as I do with Apple because of the shipping and I certainly don't shop at the record store in the malls. I truly believe that they just aren't cognisant of this. People that steal intellectual property will continue to do so no matter what kind of protection is applied.
Posted By Bill, Minneapolis, Mn. : 9:58 PM  

Steve does not actually care what is good for consumers. After all, he is CEO of a corporation, and corporations are bound by law to be greedy to the core.

Ok I'm being sarcastic. I agree with David, SJ is a visionary and cares what is best for consumers. That is why he is so successful. At the same time, it is probably also why Macs have a small market share compared to the OS of a company that prioritizes their bottom line higher than doing what is best for customers.
Posted By Rob, San Francisco, CA : 10:20 PM  

How nefarious of someone who runs a big corporation to try and think of ways to make their company's market share bigger and costs cheaper! I wouldn't put it past him either.
Posted By Chuck Taylor, Phildadelphia, PA : 10:26 PM  

Given the absurd way in which Microsoft have restricted virtually all media from running within Vista, could this be a move by Jobs to position Apple as the consumer champion when DRM comes back to bite?
Posted By John, Melbourne, VIC : 10:27 PM  

I wont trust Steve who himself cheated the world with his options. Hes aint no hero anymore and I bet he is doing this to further dominate the music industry. Hes showing that hes a messiah for the people when he definitely has an ulterior motive behind this.
Posted By HP, NYC : 10:28 PM  

I think I would buy more music online if the DRM were removed.

DRM freedom is what keeps buying CDs.
Posted By Melvin, London, UK : 10:34 PM  

Ok, let's squash some myths.....

Stormkrow wrote:

>DRM is a horrible idea FORCED upon consumers by the RIAA/MPAA period.<

The MPAA and the RIAA are trade and legal associations for their respective industries. Neither organization sets policy for their member companies. Whether or not a company uses DRM is entirely up to that individual company.

>It goes against all consumer rights of Fair Play and is needlessly restrictive.<

There is no such thing as a consumer's right to "Fair Play." Could you be talking about Fair Use? If so, keep this in mind: Fair Use is not a "right." Legally you have no "right" to copy and distribute copyrighted works. "Fair Use" is a legal defense claim to copyright infringement. In other words, if you are taken to court for copyright infringment, you can claim that you were using the material under the "fair use" defense. It's up to a judge to decide whether your defense is sufficient to dismiss the charge. Look it up if you don't believe me.

>It is not the tech companies responsibility to protect RIAA's dying business model.<

It's also not up to the tech companies to determine the business model that copyright holders may use or favor. Look at it this way, if DRM is removed from music content, the music companies may suffer financial harm, however Apple will continue to sell iPods regardless of the outcome. Why should music companies absorb that risk? No one is forcing Apple by gunpoint to sell music. They walked into this with their eyes wide open. They won't walk away because of the tremendous revenue they're making selling HARDWARE.

>MS Vista is built around DRM and that in the end will be it's downfall. <

This is pretty much a nonsensical statement. If Vista succeeds in the marketplace, will you concede that it's *because* it has DRM? I didn't think so.

>Consumers have the right to do whatever they please with the products they purchased, period.<

Actually they don't. Unauthorized distribution of copyrighted works is spefically prohibited. You need to brush up on your copyright law. However consumers DO have the right not to purchase products they don't like, and that's where their efforts should be concentrated. Vote with your wallet if you don't like it.

>And just in case anyone has forgotten the fact that in the US consumers have the right to backup or copy any media they have purchased by law<

You cannot be prosecuted for making a backup. This is very different from having a "right." Content companies have no obigation to facilitate your making a copy.

>DRM is trying to circumvent our rights.<

Actually no. DRM is a technology. A technology can't circumvent your "rights", especially rights you don't actually have. If you truly did have these legal rights you claim to have, then companies using DRM would have lost in court by now and DRM would be defunct. Courts have consistently ruled that copyright holders have a right to protect their content from infringing uses and to collect damages. See the Napster and rulings. Hint: they both lost.
Posted By Jim, Los Angeles, CA : 10:37 PM  

Of course Steve Jobs has a business motive -- the court cases in Europe making the specious claims that the DRM in iTunes is "anti-consumer" are just part of it. The idea that Aaron in PA made regarding Vista's self-crippling DRM being cast in a negative light was something I hadn't considered, but is more of a side benefit.

The real reason Steve wants to get rid of DRM is to save the extraordinary amount of money dedicated to developing and deploying that DRM. It's a red queen's race that can never be won, and he knows it. Since the record companies are already claiming a reputed 65-75 cents for every download from the music store, after expenses he's making virtually nothing for every song. Yeah, he's making money from iPods -- but wouldn't you want to make money from selling those razor blades to with the handles?

Imagine if he could free up 1 to 2 cents -- sure, not much. Multiply it by a few billion, and suddenly your bottom line improves by tens of millions of dollars.

Copy protection will never work. Let's see if someone takes the bait.
Posted By Yohannon, Alameda, CA : 10:44 PM  

He is desperately trying to beat MS to the punch. iTunes bites. Especially on Windows. With 100GB players just around the corner, the first one to market with a drag-and-drop WAV player wins. No DRM, no compression, no poor quality, no software required, sync if you want. Nothing dead simpler. Drag-and-drop in Windows Explorer. If MS gets there before Apple, Apple is dead. Too many consumers have had too many problems with bad batteries, scratched screens, bad software and Apple high prices. Jobs & Co. are on borrowed time. And they know it.
Posted By Nick, Grande Prairie AB, Canada : 10:49 PM  

He is trying to save himself and Apple from potential lawsuits. Nothing he does is for public interest. He is a money minded monopoly nut that won't let others develop programs fro his plateform but still wants things he cannot resolve free so that he can save his rear end. Never trust that guy!
Posted By Annonymous, Cupertino, CA : 11:00 PM  

As for DRM and "customer clamor", 99% of all users of iTunes Store do not care one whit about DRM. It is not a barrier of use at all. The remaining 1% whines about DRM and its restrictions, but they are most likely the same people who made the original Napster so huge. They want things for free.

Steve is correct that DRM is restrictive, but the most likely outcome of this is the European nations who oppose DRM will simply lose their iTunes stores. The music companies will never allow their content to be sold without DRM.
Posted By Dave, Walla Walla, Wa. : 11:08 PM  

Stormkorn & Aaron are right about Vista. It is� beautifully designed and execute but DRM is embedded EVERYWHERE. Vista is actually slower the XP because of it.

Worse yet, it used to be I could watch a standard issue DVD on my laptop & the quality was acceptable. Now I can't, the M$ video driver is so bad for this laptop (nVidia GeForce FX Go5200) that Vista doesn't install it but uses a SVGA driver. Well that's fine except it sets the LCD screen of the latop to be 'Default Monitor' and refuse to play the 'protected content' DVD on the Default Montor because it thinks it's a 'TV Out' connector.

On my Vista desktop which has plenty of power it degrades the quality so badly of the 'protected content' DVD that it is not even as good as the Standard Definition televions screen. It's MUCH worse in fact.

I kid you NOT! If you own DVDs or CDs you like to play in your computer from time to time forget Vista. REALLY.

After never ripping a DVD ever, I finally did so after that disaster. I ripped the encryption, the Macrovision, and the region out. ENOUGH is ENOUGH.

Hollywood, the Music Industry, and Microsoft are so abusive because they are more as less monopolies. Listen to them preach to us like they are Gods and we are unwashed criminals.
Posted By Asta LaVista, Sierra Vista, CA : 11:26 PM  

Nice analysis but not quite complete. Main reason why Apple wants no DRM is the processing overhead it entials. On a dedicated device like the iPod it's ok. On the iPhone the processing overhead and power consumption will make the phone respond painfully slowly and kill battery time.
Posted By Jason Stevens, San Jose, California : 3:16 AM  

Why does it have to be some nefarious money grubbing motive on Apple's part? Isn't the simplest reason just that Apple finally has the data to back up that DRM isn't helping the Big 4 music labels solve the problem the Big 4 think it solves.

I think if everyone took a step back and examined the actual development history of iTunes and then the iPod, before they became the phenomenon they are today, you get a clue as to what Apple wants. Which is to simplify everything for the consumer, and remove as many what Steve Jobs believes are needless hassles.
Posted By Eric Anondson, St. Louis Park, MN : 3:48 AM  

A small matter of language. Seve Jobs "contends" you say, that 97 percent of the music on iPods is not purchased from iTunes.

Why use the loaded word? Jobs dosn't have to "contend" that. He owns the company that makes iPods, so he has the resources to KNOW, not merely "contend."

Your use of loaded language puts your otherwise excellent analysis in doubt. If you'd stretch the language here, where else would you stretch it.
Posted By Roger Mercer, Fayetteville NC : 5:51 AM  

In Europe we just START having increasing numbers of "all-you-can-eat type restaurants", that have been very popular and SUCCESSFUL on the other side of the pond for decades. Music industry should investigate and learn from a business model, which definitely does not bring bankruptcy or poverty to ist owners, if clients come on a "pay once and eat as much as you can" basis. I am willling to pay a one-time copyright fee for my ipod, as well as for every blank CD, DVD and burner device. Music industry might at some (later?) time recognize, that nobody on earth is able to extend his or her time of listening to music or watching video beyond 24 hours per day. And: every iPod, every harddisk, every CD/DVD will reach its end of life, as well as all food consumed - no matter what amount you are able to fill in at the time of entering those restaurants. Clients will then come back if they are satisfied, or find other ways to get what they want.
Posted By Karl Meier, Bavaria, Germany : 5:53 AM  

This is the next revolution (or elvolution). Jobs has demonstrated that if people have a choice of downloading for a reasonable price or pirating it, people would rather pay for it (again, a resonable price). When the distribution costs, carrying costs, etc... are factored out of online sources, the companies make a tidy profit and the public gets what they want. Everyday another brick and mortar record (music) store goes out of business, where are people going?
Posted By Tim, San Francisco-CA : 9:47 AM  

"The iPhone as it is currently described will be prevented from directly downloading music or video itself, even though it is a wireless broadband-capable device."

EDGE is hardly "wireless broadband." Unless iPhone ships with not-as-currently-described HSDPA functionality, you're really stretching it on this one. EDGE is hardly faster than dial-up in real world terms. Nobody's going to suffer through downloading music and video over EDGE.
Posted By Doug Volkert - Oakland, CA : 10:21 AM  

the word you're looking for is 'moot' ;-)
Posted By charles, fairfield, ca : 11:11 AM  

Unless Apple comes up with a true KILLER APP, the new phone will not be a great success, whether or not it can download and record music. What the device needs, in view of its obvious disadvantages (high price, limitation to Cingular, small memory for music/video, lack of voice dialing) is such a breakthrough.

For this, that app could well be DICTATION SOFTWARE (since a microphone is already present, and a stripped-down OS X) . . . that would let a user dictate an outgoing Email, or a bit of text that could go into a rudimentary word processor (like TEXTEDIT), and thence to a memory file or, by any one of several means, to a printer if desired.

Then, trademark issues permitting, the device could be renamed the POCKET MAC !
Posted By Al Feldzamen, Ithaca, NY : 4:06 PM  

ad hominem - circumstantial

does jobs have valid points? it doesn't matter what his "motives" might be.
Posted By Phillip, Baton Rouge, LA : 4:16 PM  

"Given the absurd way in which Microsoft have restricted virtually all media from running within Vista"

Microsoft has NOT restricted any media in Vista.
The ONLY media restriction is on HD content and it's placed there by the MPAA, not microsoft. You will see the same thing in Macs. And that same DRM exists in your set top HD player and your TV.
So much FUD about Vista and none of it is true.
No, your MP3's don't expire. It doesn't prevent you from playing your DVD's. The only restriction is on HD content, again, place their by the MPAA and all it does is require you to have an HDCP output and a montior with HDCP input for full resolution viewing. No big deal.
Posted By Jason, Gresham, OR : 4:24 PM  

You create a monopoly.
You exploit it.
You see the legal handwriting on the wall regarding the potential monopoly via DRM and related issues.
You cry out, I want to change it, but the others won�t let me.
Crocodile tears...all the way to the bank.
Posted By Rob Jones, Berlin, Germany : 4:25 PM  

You make it sound so sinister, when it would clearly benefit consumers. You wouldn't put it past him? What? Trying to offer a better, more versatile product that would attract more customers, increase stock values, and further push Apple as a player in the industry? I wouldn't put it past him either...
Posted By Sam, Orem, Ut : 4:32 PM  

"Now I can't, the M$ video driver is so bad for this laptop (nVidia GeForce FX Go5200) that Vista doesn't install it but uses a SVGA driver."

That's not a MS video driver. The FX series of cards like what you have is the worst that Nvidia has ever produced. And Nvidia's Vista drivers are horrible. They aren't even out of beta. Your beef is with Nvidia here, not microsoft.
However ATI drivers are final and working fine.
On my system Vista runs faster than XP. And there is no more DRM than XP. It only has support for playing content encoded by the MPAA and RIAA. Nothing more. Same as your set top player and TV, both of which must support HDCP so this is absolutely no different than what is required by the MPAA of computers to play that content.
Actually activation is less restrictive in Vista than in XP.
Posted By Jason, Gresham, OR : 4:33 PM  

For Ed Burke, Bethesda, MD :

When you rip cds in iTunes, no DRM is applied to them. Your problem was probably this: The songs were in iTunes, but not on your iPod (except, perhaps, as copies, which the iPod won't play because they don't exist in it's iTunes database then). If you installed a new copy of iTunes and then synced your iPod with an empty itunes library, it wipes the ipod. It even warns you that it's going to do that.

No matter how you cut it, your problems with music that you ripped from CD yourself had absolutely nothing to do with DRM.
Posted By Steve, Independence, MO : 4:46 PM  

The reason Jobs is trying to get rid of DRM with regards to the iTMS is specifically *because* they're moving into the video market.

Look at it this way.. When you sell music that only works on your players, and you have like 80% of the player market, then you have a market for a lot of music sales. DRM won't be too burdensome to your business.

But Apple just recently came out with the iTV, and frankly, it kinda blows. It's difficult for consumers to use and setup such things, it's overly expensive, and what's worst, it's *necessary* because of the DRM requirement. All other approaches are hard and burdensome.

But there's already hardware that can play these videos, sans-DRM. Sales of them have been going on for a long time. Heck even some DVD players have the capability to do it built right into them, just plug them into an ethernet connection or a wireless connection. Jobs knows that he's not going to take the home video market with the Apple iTV thing. But he still wants to sell those movies, they're major profit to Apple.

So by showing that he can continue to sell a lot of music without DRM, he shows that DRM is not necessary. And this is a step closer to allowing him to remove the DRM from video sales as well, which is the first major step to making it truly easy for buyers to play their purchased iTMS videos on their television sets. Allow the hardware market to be competitive and able to play his videos, so he can sell them. The money is not in the hardware in this specific case, the money is in the content.
Posted By Samuel Wood, Memphis, TN : 5:00 PM  

Very well written, succinct and informative article. I must say though I have a gerat deal of contempt for Jobs, I hope he succeeds in swaying the powers that be. Hopefully it will leave the door open for an alternative to Apple products designed to break shortly after the waranty expires.
Posted By Joe, New York, NY : 5:06 PM  

Well I view it as the music industry is the one area where apple is not aloud to expand ie making marketing music. This is because of the lawsuit with them and the beatles apple lable. soo b.c the do not profit directly from making music this is a sound thing for them to push for.
Posted By Paul, Chicago, Il. : 7:41 PM  

If it is true that there is no way to download a song without docking, then this article makes sense. It doesn't discuss the three different radios on the iPhone: the cell phone, the WIFI and the Bluetooth. Of all three the only one that makes sense to use for downloading songs is WIFI; the others are simply too slow. Right now, I can use my laptop to download a song over WIFI without any problems. If I can't do the same with my iPhone because cellular providers or music labels want you to use an inappropriate technology and have written licensing restrictions as such, you have a story.

Otherwise, the story is the deal with the Beatles and the fact that Apple is really in the music business now.
Posted By Martin Rigby - Brooklyn, NY : 9:54 PM  

> Why now?

Because Finland just this week outlawed the iTunes music store and other European countries are potentially going to follow suit.

Do you really to find another reason?
Posted By Ant, Melbourne, Australia : 1:43 AM  

"we all get to benefit from it"???

well, apparentely that's not happening. and steve jobs himself is saying so.

Posted By nando, rio de janeiro : 11:06 AM  

I personally won't buy music from the itunes store specifically because of the DRM. Or any other online store for that matter. I may be old fashioned but i like the freedom to do whatever i want to music i've paid for.
Posted By Ben C, Bellingham, Wa : 3:54 AM  

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.