Music Execs Think DRM Slows the Marketplace

MacGod writes "From BBC News comes a story about a Jupiter Research survey conducted before Steve Jobs's anti-DRM essay, indicating that most music industry execs see DRM-free music as a way to expand sales on digital tracks. The survey covered large and small record labels, rights bodies, digital stores, and technology providers. To summarize: 54% of music execs think that current DRM is too restrictive and 62% think selling unencumbered music would be a way to boost sales. Even limiting the survey to the record labels themselves, 48% believe this. Yet, many also believe it's not going to happen without significant governmental intervention — even though most insiders think DRM is harmful, the labels are keen to stick with it. Is this yet another sign of the typical media industry 'head in the sand, refuse to change' approach, or might we be seeing the early stages or some actual change?"

COMMENT PROTECTED

Please enter your authorisation code to view this comment.

Re:COMMENT PROTECTED

muslix64

Re:COMMENT PROTECTED

Windows has detected you clicked on a submit button...

Cancel or allow?

Re:COMMENT PROTECTED

Windows has detected you clicked an accept button?

Do you actually, really not want to not, not click this button?

Re:head in sand vs change

I dunno what their problem is. People WILL always copy songs, and try to get them for free. They did it with vinyl and recording it to 8-track and cassette. Hell, my friends and I did as kids...we'd figure out that each one of us would buy 1-2 albums, each different, and then swap them to record them. That's they way it happens.

However, now that I'm older...I got money to spend...plenty of discrecionary money. However, I have never bought a single song online. Have I downloaded any mp3's? Years ago when I first discovered them on USENET, sure I did a few...mostly bootless Zeppelin/Stones stuff I couldn't find anywhere else...but, for the most part I pretty much own all the CD's of music I like. I have a high end stereo, and I like to play the best version of a song that I can.

If they would offer for sale online...lossless songs without DRM so that I could burn hardcopy backups, and my own lossy versions for my car or portable (no big deal with such a poor listening environment)...I'd be all over that. While I like a good deal and free stuff as much as the next person, I don't mind spending money for things I want. I think there are plenty of people out there just like me that they'd make plenty of money off of if they opened things up.

I just don't want to buy music/video that is of lesser quality and hinders me from doing what I've done with it in the past when a copy I bought was mine to use, play and store as I wished.

Re:head in sand vs change

They don't have a problem. They simply see that with DRM, they can get the honest people to pay several times for the same song. The pirates won't buy their music either way, so I guess they figured they are simply going to get as much as they can from the honest guys. It's stupid, of course, but it probably makes sense for them.

DRM is not piracy prevention.

Your problem is that you're assuming that DRM has something to do with preventing piracy.

That is a fallacy. It is something the music companies would like you to think, but it is not really true. DRM is about "maximizing revenue," principally by allowing the record companies to sell the same piece of music over and over, in different formats. Basically, is purpose is to eliminate format-shifting altogether, because that way they can charge independently for a song on CD, as a digital file for an iPod, as a digital file for a cellphone, as a ringtone, etc. etc.

The music companies have realized that digitization basically means the end of formats that wear out over time, and it will also mean that it's pretty trivial to move your music from one type of playback device (e.g. iPod) to $NEXT_YEARS_DEVICE without them seeing a dime. Since their business model historically has derived a lot of revenue from the repurchasing of music in new formats (45s, 8-tracks, LPs, cassette tape, CD), they want to stop this, even though it's allowed by Fair Use as a simple format shift.

DRM is only nominally about piracy; in truth, it's about squeezing more money from honest consumers.

Re:DRM is not piracy prevention.

Basically, is purpose is to eliminate format-shifting altogether

If that's so, then why is it that most DRM systems allow format-shifting to DRM-free formats?

Since their business model historically has derived a lot of revenue from the repurchasing of music in new formats (45s, 8-tracks, LPs, cassette tape, CD), they want to stop this

Such shifts are too rare to be protected at great expense. The music industry does not live and die based on whether people purchase the same music every few decades -- it lives on lots of people buying different music every year. Consider that the largest group of music consumers today have probably never owned anything but CDs.

Alvislujia

Other than 'its chilly down here' comments, I have to say I think this is record companies trying to pose like they actually care about the consumer, while still loving the RIAA henchmen they employ. I don't buy it for a second.

Re:Alvislujia

Perhaps, but there is a real phenomenon of corporate momentum. It's more than possible that 48% of record executives believe that non-DRM is the way forward, but who actually decides the policies of the company? Partially, it's decided by "this is what we've always done" and partially by the conservative 10% who live at the top. They're the ones that a survey of would be interesting.

Re:Alvislujia

I disagree. I think that they've seen what happened to their MPAA buddies when they spent countless millions developing DRM for HD-DVD and BluRay, only to see them broken before the sales got off the ground.

I always had a sense that while the RIAA execs had the information about the uselessness of DRM all along, their greed and anger was too great for them to admit it to anyone, especially themselves. But this recent fiasco, along with a very high profile essay by Jobs might have just been enough to jolt them into realizing that the reason that they're losing money, is because they're failing at their primary business model - music distribution.

They got so caught in copyright protection that for awhile it seemed like this was their primary focus. It was almost clear that the RIAA lawsuits were becoming a profitable side-business in the form of outright racketeering and extortion.

But perhaps the decreasing sales of CDs in the context of a flourishing DVD business, and very healthy iTMS sales, they've finally come to their senses.

The goal of RIAA is to distribute music at a price to the consumer. So that's what they should be doing. If the labels got together, and opened an online music shop with non-DRM custom-format/bitrate downloads from 96kbps to uncompressed, a-la-AllOfMP3, they'd make a killing!

So perhaps long-term greed reinforced by reality and logic has finally triumphed over old-school throat-ripping greed...

Re:Alvislujia

I think this analysis is correct.

Back in the 80's, we went these particular rounds with the software industry. Software vendors had resorted to putting creative errors on their media, changing the track pitch, sometimes even using lasers to burn holes into floppy discs (the DRM system would attempt to write the sector that was supposed to have a hole in it, and then read it back, and exit if it succeeded in doing so) in an attempt to prevent illegal redistribution of their software.

Ultimately, most software vendors gave up on this whole idea because the finally realised that they were doing more harm than good. In at least one instance, a game title that ran fine on my next-door neighbour's computer, would not run on mine. Both machines were essentially identical (Commodore 128, 512K expansion RAM, 1751 floppy drive). It turns out that the DRM kicked on this software simply because my floppy driver was ever so slightly out of alignment.

At any rate, the software vendors largely gave up, though they are starting to get back into it again. On the part of the MAFIAA, this is a case of them failing to learn from another industry's mistakes. Now, it looks like they are starting to get it. Hallefuckinlujia!

Incidentally, I am still pissed off over HD-DVD and BluRay players downrezzing when connected to an analogue HDTV. I was an EARLY ADOPTER and helped FUND the RESEARCH that made HDTV possible, motherfuckers!

Re:Alvislujia

The goal of RIAA is to distribute music at a price to the consumer.

No, that's the goal of the RIAA-member record companies.

The RIAA's original goal was to establish and enforce technical interoperability standards that would ensure that an album released by any label would play back accurately on any make of record player. Ironically, the RIAA's current efforts are very much the opposite of that original charter.

Re:Alvislujia

And?

That revocation model has a fundamental weakness, one that hasn't improved since they deployed the exact same model for CSS (which they barely touched, because the underlying crypto turned out have many weaknesses, so that got broken instead).

Only one person has to do it. Once. Tamper-resistant isn't good enough, it really has to be tamper-proof. When one of these keys gets leaked, the key has to be revoked, every time (and each time it happens, every disc pressed up to that point can be ripped with only a few bytes worth of leak that someone only has to do once).

And that means that model stops working with newer discs.

And it isn't always going to be a software player where they can just release a new version and the old one stops working, and blame the evil pirates. They're just the first, obvious, easy target you don't even need a multimeter for.

There are still a finite number of keys. Keys that are pressed onto discs. Keys that are flashed or burned into this supposedly-secure firmware which is generally as hard to update as it is to read.

So you target a single model that's popular, vital to the success of the format and homogenous, something they will be reluctant to revoke repeatedly as it would require frequent field service or a vast stream of near-constant, flaky upgrades for millions of sold players.

In other words, target the PLAYSTATION 3.

DRM is fundamentally a trusted-client problem: Give an authenticated party a ciphertext and the key to unlock it, on the condition that they promise to follow a set of rules with them. But like all trusted-client problems, once one attacker becomes or usurps an authenticated party or intercepts the ciphertext and key or plaintext, all bets are off.

It is impossible to sell a trustworthy client (something capable of securely acting as a trusted client) as a consumer platform; the security model just does not work in that scenario! Real trustworthy clients are in secure premises with armed guards on 24/7 response and patrols, not millions of people's homes. They get audited on-site in person, not automatically over the net. The failsafes against physical intrusion are thermite and C4, not epoxy and funny screws. And, crucially, the reason for this is because once an attacker has unrestricted physical access to a trusted client, it's as good as 0wned.

I hope the content industries at large do realise that accepting, not fighting, the status quo and dropping copy-control and other digital restriction mechanisms (because they are consumer-hostile and uneconomical) is a difficult, but necessary step to modernise their approach to the increasingly digital content marketplace. So, too, is calming down their continued hysterical, out-of-proportion approach to copyright infringement, although their corporate culture is going to find that an even tougher transition.

Told Ya

http://slashdot.org/comments.pl?sid=222358&cid=180 11682 [slashdot.org]

"I know many media execs, both music and film/video, here in Los Angeles and have had many discussions with them about DRM.

Every single one of them hates DRM, thinks it is a pain in the ass to deal with, would love to sell all of their content without DRM.

But they all live in the real world."

Re:Told Ya

I think you've hit the nail on the head.

I spent 8 years in the video game industry and eventually wound up as one of two guys in the studio responsible for Copy Protection. I got the dubious honor of dealing with the tools to make sure all our CDs had our chosen form of copy protection "working".

At no point did I think the copy protection was worth the time and money we spent on it. The members of management I talked to about it weren't convinced that it was worth it either. But there was just enough anecdotal "evidence" of pirates completely eviscerating sales of games that shipped without copy protection that management was terrified to try and ship without it.

Next time you hear the **AA's going on about how piracy is killing them, realize that they may be targetting those who make decisions about including DRM just as much, or possibly more, than they're targetting the lawmakers or joe public.

Re:Told Ya

Note: I have a bitter hatred toward MS and their products, but I hate class-action suits and the lawyers that profit from them even more.

As long as the lawyers get their payment in the same form of the people they're representing, I have no problem with it. M$ Pays with vouchers for M$ products,lawyer gets paid in vouchers for M$ products.

Usurpers

Is this yet another sign of the typical media industry 'head in the sand, refuse to change' approach, or might we be seeing the early stages or some actual change?"

Sounds more like preparation for those wretched music execs to put out non-DRM'd music like it was their idea all along; as if their customers haven't been shouting for DRM-free products all this time.

Re:Usurpers

Which would be fine, but thanks to napster, and all the p2p that has come since, they've already been forcibly thrown from the cliff. They better start flapping, or things could get ugly.

OK I am really confused.

I was confused by the summary at first, and now that I've R'ed TFA, I am no more enlightened. The article says that music industry execs think they can boost sales with unencumbered music, but that music labels won't allow this to happen, and that in the future music execs want DRM to allow them to manage their rights rather than encumber music.

So, can somebody please explain:

(1) What is the difference between the music industry execs and the people who run the labels, and

(2) If the music industry execs are saying they do or the don't want DRM?

Thanks.

They should have learned from e-books

Why did the music industry think consumers would accept DRM?

The obvious and total failure of DRM'ed e-books should have warned them: Take a medium that consumers view as a tangible product, that they can buy and sell in an aftermarket, and try to turn it into a limited, licensed, revocable, non-transferable right-to-use at a not particularly attractive price - and it should succeed?

What are they snorting? Oh. Right. Never mind.

I don't understand. Help.

So record company execs are saying:

1) DRM is bad
2) It hurts the market
3) Doggone it, let's get rid of it!

But then they say....

4) But we're not going to get rid of it
5) We're hoping the government will force us to get rid of it?

I may not be as bright as some of you guys around here, but this doesn't make any sense.

They really seem to be saying:

1) DRM *THE WAY WE'VE DONE IT* is bad.
2) No way will we get rid of it, we'd rather have bad DRM than none. We need to be able to resell Elvis tracks every 5 years to the same consumer.
3) What we're hoping for is the government mandates a technical solution, since Apple has really screwed us up, and we don't seem to be able to work together to come up with a viable solution on our own.

Seriously, if you're the government, isn't it reasonable to say "Gee, selling music to consumers is not a core function of government. You guys figure it out. We've already given you eternal copyrights and the FBI to enforce it, what else do you need?". But I guess that won't happen.

Re:I don't understand. Help.

I think it would be benificial for the government to prevent DRM. They wouldn't waste all that FBI money on enforcing it, they would waste all that money in the legal system fighting over it's infringement, and consumers get a product that isn't artificially limited in it's use. And depending on who you believe record sales will actually increase as consumers get a product they're more happy with/are able to let more people experience more music causing them to buy more music.

It's win-win-win... except for the companies that exist only to develop ridiculous DRM schemes... but they were already losers anyway.

Re:I don't understand. Help.

1) DRM *THE WAY WE'VE DONE IT* is bad.
2) No way will we get rid of it, we'd rather have bad DRM than none. We need to be able to resell Elvis tracks every 5 years to the same consumer.
3) What we're hoping for is the government mandates a technical solution, since Apple has really screwed us up, and we don't seem to be able to work together to come up with a viable solution on our own.

The more I look at it, the more the music labels seem to resemble strung out junkies.

They know that DRM hurts more than it helps.

They know that infringing copying is rampant, and DRM schemes do nothing to stop it. I think they even know that the losses due to copying don't really make that much difference to their situation. Some difference, but not much. In fact, the most swapped music tends to enrich the bands at live gigs and sell more merchandise.

They want to stop, but they just can't. They can't make that first step. One of them (EMI, maybe?) will go cold turkey for a bit. Their tracks will then be all over P2P as they already are and always were, but this will be enough for the pushers (DRM manufacturers) to say "See? Do you want that sort of pain for your back catalogue?", and enough of them will start hurting. Enough to continue the sad cycle.

Eventually, they will phase out CD sales, and replace them with (DRM'ed) downloads only. Fine. I don't care. I won't buy them, and I won't even hack round them. And the bands I do buy from will be those who market themselves well enough, and play good gigs.

An old industry dies. A new one lives. It's a fair trade.

--Ng

DRM is good

Personally, I'm all for DRM. If we have a effective and uncrackable DRM system, more people wouldn't bother listening to the garbage hollywood and the music industry force on us (Brittany Spears, etc.) because they have to pay for it. Smaller artists who give their music away and make money by dealing directly with local radio stations concert venus would thrive.

You First!

To summarize: 54% of music execs think that current DRM is too restrictive and 62% think selling unencumbered music would be a way to boost sales. Even limiting the survey to the record labels themselves, 48% believe this. Yet, many also believe it's not going to happen without significant governmental intervention....

The bottom line is that a critical mass of the MAFIAA has figured out that their omerta is no longer viable, but nobody wants to be the first to break it.

The problem is...

if DRM is removed and piracy jumps, the cause-effect logic will be very hard to refute. It probably CAN be refuted (all that has to happen is to have a file successfully ripped once and it's all over the internet) but an observed jump post-DRM removal would undoubtedly end some careers. Nobody wants to take that chance.

The music industry seems to be doing quite well (which is not to say the artists are getting all they really should, but that's another post) since they have money to spend playing around with copyright law. There is no "we need to try DRM-free music before our profits dry up!" imperative which might drive people to take risks and the company to accept risks, so DRM (which is easy to make sound good, whether it is or not) won't go anywhere until the case for it hurting sales AS A CONCEPT (not just a bad implementation) becomes obvious enough to convince anyone.

The only way I can see that happening is an "open source music" phenomena that replaces corporate music trends, star generators, and hits with something just as good (or "effective" if you don't think it's good) but community controlled. That's hard, because opinions are subjective and can apparently be influenced by ads. We need a central site, lots of sources of music people want to listen to (not what they SHOULD want to listen to, mind you, but what they DO want to listen to - no running people down for their (lack of) taste), and quality control that people can trust. When THAT emerges, DRM will become too much of a liability. I don't see anything else that can do it.

Good Cop Bad Cop

The Sales Department of any entertainment conglomerate will happily beat the "DRM is bad" drum because their job depends on it.

Meanwhile, executive management is doing everything in their power to maintain their distribution cartel. DRM serves their end game quite nicely thank you.

Consumers don't care and will accept their DRM schemes because they don't know any better. All the righteous outrage on ./ amounts to absolutely nothing because nothing will ever be done by nearly all ./er's. Most of us on ./ know better but won't do a thing to improve the situation for the uninformed. Myself included.

Grinding Halt

They are 100% correct that it slows down the marketplace, actually it comes to a grinding halt since I'm not buying anything which is DRM'ed.

DRM is ultimately a WASTE OF MONEY

Remember the guy who beat the CD copying by using a black magic marker or macrovision's using the same video scrambler technology they developed in the 80s that can be defeated with a $30 video enhancer unit on eBay? Why is the industry wasting time and money to be encrypting systems that seems to be defeated before they are deployed in the market. DVD Jon has busted DVD's and other alleged "secure" media. Some of these hacks are 20 to 30 lines of code! So much for the millions of dollars invested. Even Legislation has done nothing. What has come from the RIAA suing 12 year old's for downloading music. Limewire and other P2P engines are active now more than ever. The funniest part is watching these music artists bitching about how record companies steal their money and giving a press conference with their million dollar mansion in the background, or coming out of a restaurant most people could not afford to eat at. The reality is modern music sucks, so does most of the content they are trying to protect. That is the real reason why the media companies are losing money, not because of piracy. They want to blame other people instead of the trash they are peddling as entertainment.

As a person who hates DRM

I'm not sure if they are mistaken or not.

A few people revel in ripping things off. The music industry (MI) will lose some money on them.

A lot of people have absolutely no morals and will do what costs them the least. MI will lose some money on them.

A lot of people are as moral as they can afford to be. MI will lose some money on them if people feel swapping non-drm'd titles is okay.

The folks folks who are very moral, it won't really matter unless the basic morality of the action is redefined by the culture (which I see a strong incentive to occur).

It might turn out to be the last big blast of sales income before music sales dry up.

Surveys

Surveys are one of the least reliable ways to get statistics. Why? Even with anonymity, people try to cast themselves in a good light on surveys. If music executives don't like DRM, then where is DRM coming from?

Okay, fine

With all the anti-DRM stuff coming out of these guys who speak out of both sides of their mouth of late, it is easy to be cynical, and I have been cynical on this topic. Every one of the people who have come out against DRM (yes, Jobs too) has been a beneficiary.

They all hate it? Fine, do away with it by mutual consent! Shut up and do it!

Otherwise it is just like one of those ads that say the banks are your friends.

Only DRM Vendors want DRM...

Only DRM Vendors want DRM and their strategy is to create fear that if you release any music without DRM it will be pirated.

Common sense should tell them thats what a CD is, music without DRM, they are not changing the dynamic at all by giving up on that DRM crap.

So FUD is all they have, because their DRM doesn't work and doesn't sell.

FINALLY!!

You know, I have been avoiding buying music over the 'net simply because I don't want to be stuck with some proprietary DRM format that isn't transferrable to my various players. For example, I once bought an album from Lush on Real Tunes or whatever. I then tried to transfer it to my Palm Zire and - bzz! - no luck. Because the Real Player on my Palm doesn't handle DRM files, I cannot play it. Oh, and it didn't play in Amarok either.

I know the industry is afraid of downloads - just look at what you can get on Usenet - but they should just provide what we want in an easy interface (like iTunes) and we'll buy.

Of course, come to think of it, I can't play my U2 or Duran Duran 12" EPs on Amarok either, so I wonder if my argument is moot...

Amusing enough

They fought MP3's for years, they finally "gave in" and implemented restrictive DRM, now they finally may remove it because they think it will "help" sell their product.

Good job fucksticks, if you would have embraced the technology 8 years ago you would possibly have much much better sales right now. You'd think the record industry would learn from past mistakes but no, the same morons keep making the same decisions.

Digital Rights Management huh

This just occurred to me (call me slow), who came up with the abbreviation DRM? Somehow I doubt it was some random blogger. To state the obvious: the goal of the whole bloody concept has become to blur it. Read the words spelled out "Digital Rights Management". Whose rights? Who is managing? The only thing that is clear about it is the word "digital" but I count on the creativity of /.:ers to blur that part as well. As far as the regular Joe is concerned this could be something positive for him -- before doing any research, but why would he think he should?

Point is, in the case of the regular Joe half the battle is already lost, they have no bloody clue what DRM is, it's just another abbreviation along with DVD, HDDVD or whatever else that is `in' right now. For some twenty years DRM was referred to as "Copy Protection" because that is exactly what it is, by renaming it to some nonsensical abbreviation they have created a highway for easier acceptance.

But ah, it's not like it's the first time some industry does something like this...

And now we get to the point where I am considered troll: I do believe there are places where "DRM" is called for, anyone who posts it is all-through evil gets a page-down tap from me (it's usually long rants). Lately it has however been going out of line. Repeatedly.

On an ending note, all according to Google: 46,200,000 hits for DRM. 2,900,000 hits for "copy protection" (quotes included). God, I feel old.

DRM and Piracy

I just don't see that piracy would take a big jump if DRM is removed from the content that is sold at iTunes et al. DRM is already broken and song files appear on filesharing networks. This will likely continue, however, I would prefer to receive a sanctioned, DRM-free, high-quality download for a reasonable price. I will only pay for DRM-free tracks so I could use them with any device I own or may own in the future. The real reason that these files are so readily available on filesharing networks is that once people download the file, the file is left in the share folder and others are able to download it from there. If people can be convinced to use sanctioned download services it may actually serve to help reduce piracy by keeping these files out of individuals' share folders on the various networks. The fact is I (and I believe many others) can afford to pay $1 per track, but I will not pay for something that has been intentionally crippled. Right now, aside from a few independent artists, the only way to get a DRM-free track is by either buying the CD and ripping it (and hoping that there is no rootkit or other nefarious code lurking on the CD) or through the filesharing services.

power

It's because the music executives are realizing that if they insist on DRM, they may well end up at the mercy of a company who's DRM scheme gains monopolistic market share [apple.com] or that other company who wants its DRM scheme to gain monopolistic market share [microsoft.com].

You are coming to a sad realization...

... allow, or deny?

Allow.

Apple is the problem, not the execs

I've heard in multiple articles and reports, one being an NPR interview with the Vice President of Marketing at Apple stating that DRM is in Apple's favor and they don't want to change it (it was a foot in mouth moment you've gotta hear it). DRM is beneficifal for keeping their market share. With all your music locked into an ipod you can't jump to any other hardware product. Practically the day after that interview Apple did an about face and Steve Jobs posted his "thoughts on DRM" article. And I'm not putting all the blame on Apple, DRM is or was in the music industry's benefit too, but right now, Apple is set up to 'possibly' loose if they pull the DRM out now.

iTunes business model flawed

I think that the model of digital distribution, that consists in having the consummer pay about as much for a data file as they would for a packaged physical support with the same content, is flawed at the core. You get at most the same experience as you would by paying for the physical object, and often much less : compare for example a TV show episode on iTunes : $35 for a whole season when a boxset can usually be had second hand for $25 on a C2C website. And then you have no widescreen, no subtitles, no chaptering, no extras, and much worse-than-DVD video quality. And you're very restricted in how you can play it : if in fifteen years you want to watch your show again, assuming the file is not lost to some harddrive crash or computer upgrade or bad backup discipline, you'll have to do it on some Apple hardware, and no other. By that time maybe another company will make much better products, you'll be restricted to using Apple hardware all of your life or you have to give up on your $35 show (and the rest of your collection). Imagine paying for the right to watch The A Team in the 80s and now if you want to watch it again, having to do so on an RCA TV set.

Re:iTunes business model flawed

I think that the model of digital distribution, that consists in having the consummer pay about as much for a data file as they would for a packaged physical support with the same content, is flawed at the core.

Actually, while this may be unpopular on ./, it's indicative of value pricing of the digital product. You may not feel that is 'fair', but pricing isn't about fairness. It's about extracting the maximum amount of value from the consumer of the product while leaving the consumer with enough value that they return as a customer. In this case, the fact that the content is copyrighted generally trumps pricing fairness under anti-trust law (because the effect of copyright is to grant a temporary monopoly).

Digital downloads and CDs are well differentiated products, and they both have an effective place in the market. I suspect the value for the digital content is appropriate. Marketing = Product, Promotion, Price, and Position (or some other form of 4 Ps equating to the same message), so if you are purchasing a season-at-a-time and are price sensitive, you are not their target market. That doesn't mean the market does not exist (e.g. I think ringtones are the biggest rip-off known to man-kind, but I can't ignore that it's a billion dollar market).

Digital distribution is targeted at those who are either cherry-picking or are time sensitive. Conversion from a CD to digital form takes time and effort (worse for DVDs). To some people, this time is worth more than the price difference between the products (and to others, they are so price-insensitive, that they will probably buy the digital version to watch the show during their commute and then purchase the season DVDs once they are available). One could also digital distribution is carrying a premium price at the moment, because it's 'hip'.

One pays MORE on a relative basis for an individual ditigal product of lower quality than they can receive on a CD or DVD. It's 100% consistent with hundreds of thousands of physical products you can buy in a store. Effectively, CDs/DVDs are bundles, where you also receive the benefits of the doctrine of first sale (because you bought a product, not a license). Therefore, by buying the bundle, you get a discount (or you can view it as getting the higher quality for free). Buying the individual songs, you pay the market rate. In the case of TV shows, you may also get a time advantage (this is part of 'Position': it will be out in digital form before the season DVD is available).

Another useful analogy is to look at cost per bit of digital transmission. Try it someday on an SMS (cellular text) message (128 characters) vs. what the cable company pipes to you every month. The cost differential is something like 100,000X on a per-bit basis. That doesn't mean either cable or SMS is fundamentally flawed. SMS is certainly value-priced, but the number of users indicates it still possesses value even at that price.

Note that this judgement is on a relative basis to the cost of a CD, I am making NO judgement here about whether the CD costs are over-inflated due to industry behavior. That is an entirely different discussion which is not required to properly evaluate the relative value of individual digital tracks to a physical CD.

Given the current price of a CD, the prices are pretty close to what the market will bear (they are value priced). CDs can be effectively purchased for about $7-$8 at your favorite music club or other method of bulk purchases. So effectively, if you're buying more than 3 tracks on a CD, it's much more cost effective to buy the CD. For a one-hit wonder or a band where you appreciate a single song, but generally cringe at the music, use a $1/track digital source.

Government does just the opposite today

"significant governmental intervention" ... like, say, the DMCA?

DRM means the end of Microsoft

I don't think it's a much of stretch to say that selling music without DRM will probably destroy Microsoft.

I think *this* -- essentially the end of Microsoft -- is what's at the core of all of this. And the end of Microsoft will be the *result* of DRM-less tracks. Jobs knows this. Everybody knows this. This is the elephant in the room that no one is talking much about.

Vista is all about DRM -- everything about Vista is DRM wrapped in eye-candy. Vista is the DRM operating system.

The end of DRM means the end of Microsoft as the major OS player. It also means a return to the "hobbyist" computers of the 1980s -- the TRS-80s and the Commodore 64s and the Apple IIs. This "hobbyist" market continues to erode as DRM gains a foothold. Drop DRM, and we're back to where we were 25 years ago -- personal computers that were meant to serve users not the corporations.

Just my two cents.

it's a European survey

at first I was confused by the slashdot blurb... if execs surveyed really feel this way, then how can the next breath say that labels are keen to stick with DRM? Aren't execs of labels, and labels, kind of the same thing? I figured, something must be up with the polling.

Then I saw the first sentence in the article:
"The Jupiter Research study looked at attitudes to Digital Rights Management (DRM) systems in Europe music firms."

They only polled European firms. I guess that explains the difference between what people think and what is actually done. So we're only reading about what European execs think, and then comparing it to what the industry as a whole is doing.

I'm sure this is true

Just as some slaveholders were beginning to come out against slavery before the (U.S.) Civil War, mainly on economic grounds. There were not enough of them, however, and they were not in sufficient numbers to prevent said war.

DRM not a problem for me

I used to listen to music during my daily commute and while exercising (cycling). I'd convert my CD's to MP3 and burn mix CD's for the car and load-up my (non-IPod) MP3 player for exercise. After encountering a CD I couldn't rip for MP3's due to DRM (and that the store wouldn't allow me to return) - I stopped buying CD's. I've tried ITunes - but it's too much hassle to get it to work with non-IPods.

Anyway I've switched to listening to podcasts (Thank you Leo Leporte!!). I use 'Juice' to download (via the RSS feed) and just drop it onto my MP3 player. Got a wireless transmitter for the car, which is not great for music, but good enough for voice.