In a press conference today in London, Apple and EMI Music announced that starting in May 2007, EMI Music's entire digital catalog of music will be available for purchase in DRM-free versions from the iTunes Store worldwide. Removing Apple's FairPlay digital rights management system from the tracks comes with a price, though. DRM-free tracks will cost $1.29 rather than $0.99, although they will also feature higher quality 256 Kbps AAC encoding, which Apple claims makes them indistinguishable from the original recording. 128 Kbps versions with Apple's FairPlay DRM will remain available for $0.99, giving users the choice of which track to purchase.
All EMI music videos will also be available without DRM, with no change in price. iTunes will provide a one-click option for customers to upgrade previously purchased EMI songs for 30 cents per song.
Commenting on the announcement, Apple CEO Steve Jobs said, "We are going to give iTunes customers a choice - the current versions of our songs for the same 99 cent price, or new DRM-free versions of the same songs with even higher audio quality and the security of interoperability for just 30 cents more." The move comes a mere two months after Jobs posted his widely read open letter about the ills of DRM and Apple's opinions about it (see "Steve Jobs Blasts DRM," 2007-02-12).
The removal of DRM from EMI's content sold through the iTunes Store is a significant event in the short history of online music sales, given the iTunes Store's leading position in the market. Customers purchasing DRM-free songs will be able to play them on any digital music player that supports unprotected AAC (and you can bet that the capability will be added soon to any that currently don't), thus starting to eliminate the complaint about how Apple required the use of the iPod to play iTunes Store purchases. Other usage restrictions that disappear for EMI songs include being able to play purchased songs on only five computers and burn playlists containing purchased songs only seven times. Needless to say, the removal of DRM does not mean that it's legitimate to copy music in ways that violate copyright law, but that's not new.
The increased price presumably helps EMI feel better about the possibility of increased copying, and I wouldn't be at all surprised if Apple and EMI will be tracking the number of songs from the iTunes Store that appear on the peer-to-peer file sharing services. More important, increasing the price to $1.29 while keeping the DRM-protected versions available for $0.99 creates additional revenue, which the music labels had been pushing for, while letting Apple hold fast to $0.99 as the base price.
From the research perspective of determining consumer attitudes to DRM, it's a little unfortunate that Apple increased the encoding rate for the DRM-free versions of EMI's songs. Had DRM removal been the only change, it would have provided a clear-cut answer to the question of how customers value the legally granted rights that DRM restricts. Of course, since quality has never been a significantly limiting factor in working with digital music for most people, the popularity of DRM-free music will still offer worthwhile insight into consumer attitudes. Personally, I plan to pony up the additional 30 cents per track for all the EMI music I've purchased from the iTunes Store.
It's unsurprising that the first chink in the iTunes DRM armor comes from EMI, since EMI has been dabbling with DRM-free music since late 2006, selling a few songs without DRM via Yahoo Music. The question is, will EMI's move to the anti-DRM camp convince other major labels to follow? Jobs said that Apple expects to have more than half of the five million songs on iTunes available in DRM-free versions by the end of 2007, so the implication is that Apple is negotiating with the other major labels as well. Even so, the terms - FairPlay DRM or an additional 30 cents per track - seem quite set now, since I can't see Apple offering music from different labels for different prices.
Despite the removal of DRM from EMI's music videos, Jobs made no comment on whether Apple would be negotiating with the TV and movie studios to remove DRM from other music videos, the 350 TV shows, and the 400 movies currently available through the iTunes Store. (And for anyone following the numbers, Apple says it has sold over 2 billion songs, 50 million TV shows, and 1.3 million movies from the iTunes Store so far.)
Staff Roundtable -- [Glenn Fleishman] Adam's research curiosity aside, I'm especially happy Apple and EMI coupled an increase in audio quality with the increase in price and removal of DRM. For me, this makes the decision to upgrade my EMI content even easier. At 256 Kbps, according to several audiophile sites I checked, an AAC should be indistinguishable from the data encoded in a typical audio CD. I suspect the quality will be even higher, though, because preprocessing - optimizing audio or video quality for a particular compression algorithm - from the original digital masters could produce even better results. Apple and EMI haven't said anything on this front.
The other question for me is whether EMI and Apple will digitally watermark the non-DRM audio files. Digital watermarking subtly modifies the media data to overlay encrypted or in-the-clear information that can be retrieved. The idea is that the watermark can't be removed without also affecting the overall quality of the music encoded in the file. One attempt by the record industry at watermarking was definitively defeated by Princeton professor Ed Felten, a notable critic of DRM and other schemes.
[Jeff Carlson] Glenn points to the potential for dramatically higher-quality recordings, but so far we don't know whether Apple or EMI are using masters to create the files. It wouldn't surprise me if there are three interns grabbing CDs from the archives and ripping them in iTunes (I doubt that's the case, but it wouldn't surprise me). The first movie I purchased from the iTunes Store when video became available, Grosse Pointe Blank, didn't look like it was encoded from any sort of master print, even taking into account video compression.
Frequent TidBITS contributor Andrew Laurence noted that this shift to non-DRM music makes it possible to play back music purchased from the iTunes Store on hardware devices such as the Slim Devices Squeezebox or the Sonos Digital Music System.
I also wonder (without any information to back it up) whether other music companies or services are planning to announce DRM-free offerings soon. The Apple/EMI event wasn't announced until the day before it happened, and the new tracks won't be available on the iTunes Store until May. To me, it sounds like Steve Jobs hopped a quick flight to England to make sure Apple and iTunes garnered the first headlines.