Universal to Sell Music Without Copy Protection... but Not on iTunes

[MacRumors]

NYTimes reports that Universal Music is planning to sell a significant portion of its catalog without copy protection (DRM) "for at least the next few months" according to people with knowledge of the situation.

Universal, the world’s biggest music conglomerate, is set to announce that it will offer albums and songs without the software, known as digital rights management, through existing digital music retail services like RealNetworks and Wal-Mart, nascent services from Amazon.com and Google, and some artists’ web Wites, these people said.

Universal is specifically not expected to offer DRM-free music through Apple's iTunes service.

This plan is described as a "test" and is expected to run into January of 2008 to gauge user demand and if there is any effect on online piracy. The exclusion of iTunes is seen as a push to leverage power away from Apple's iTunes which currently leads the digital music industry.

It was clear that trouble had been brewing between Universal and Apple, with the recent announcement that Universal would not renew their long term iTunes contract and instead be continuing "at will."

EMI was the first label to adopt DRM-free music distribution in a joint announcement with Apple. EMI's DRM-Free tracks are called "iTunes Plus" and cost $1.29/song for the DRM-free, but higher quality tracks.

According to the New York Times article EMI's sales results have been "promising". While no specific pricing has been revealed for Universal's DRM-free music, at least some of the songs are expected to be sold at the traditional $.99 price point.



Article Link

[Peace]

Here's another link :

http://apnews.excite.com/article/200...D8QTQH5G0.html

"Universal Music spokesman Peter LoFrumento said, however, that the company isn't selling DRM-free tracks on iTunes for now so it could use the Apple store as a control group for measuring the impact of sales on pricing, piracy and sales."

[ppc_michael]

That is one huge "eff you."

[sebastianlewis]

Originally Posted by ppc_michael

That is one huge "eff you."

Yep but it won't work. iTunes is the only online music store that is actually selling something besides CDs... they don't even sell CDs

Sebastian

[synth3tik]

So how on earth do they expect to get results from this "test" with out using the largest online music store? Personally any listed place that they are offering this too are places I would not shop for online music. I think Universal is being stupid. They acting like a whinny teenager.

[japanime]

Choice is good. DRM-free is even better.

I like this news.

[Cecily]

Will they get good results not going with iTunes? Probably not. But I think the decision to not use them isn't based on music sales alone but on an attitude that iTunes could monopolize the music downloading business. Perhaps theyre also testing how much clout they have over who buys what and where?

Just throwing a few thoughts out there.

[JonMan]

The stance taken by Universal depicts perfectly the problem facing the music industry -- arrogance and an inability to see the reality of the situation.

They are concerned with Apple gaining too much power with iTunes? Guess what, if not for iTunes, the market for legal music downloads would be virtually non-existent! They are shooting themselves in the foot by playing hardball with Apple on this.

Do they not recognize the severity of the problem? I am in my mid-twenties, and am basically the only one in my circle who pays for music. Everyone else I know -- including my peers in the workplace -- is downloading illegally.

iTunes appeals to me, and millions of others, because it is simple to use and looks nice. Everything else out there, to be frank, sucks!

Let them try their new strategy, whatever it is. If they continue to isolate themselves from Apple, they will regret it. If they wanted to be this aggressive, they should have taken action back in 1999. Idiots.

[RidleyGriff]

Originally Posted by synth3tik

So how on earth do they expect to get results from this "test" with out using the largest online music store?

They're clearly not -- they're just using that excuse as a smokescreen to not make it seem like they're intentionally withholding product from the retailer people like to use most.

I understand their intent -- and if people were actively upset with FairPlay, and the other services worked as smoothly and easily with the iPod as the iTMS does, it may be a very powerful move against iTunes. Unfortunately, it seems they're once again not understanding why the iPod/iTMS combination works so easily, and what music purchasers really care about. (And I am speaking about music purchasers as a whole group; those of us that care about 128kbs and DRM are the minority).

Most people will choose ease of use vs. "DRM-free" -- particularly when the majority of people out there don't seem to be butting about against Apple's authorization/burning ceilings.

Universal is making their stance clear -- they're also wasting all of our -- their customers -- time.

[JonMan beat me to the philosophical punch, but... there you go]

[robertnq]

Sounds dumb...why would i want to go to another music store open an account...download the song/album....and then load it into iTunes...thats just extra steps and more of a hastle for me...thats like driving 100 miles away to get cheaper gas...not worth it...boo universal!

[RichP]

Well, good news is they will be MP3 format, and play on ipods. Bad news is, as stated, most people will gravitate towards the ease of iTunes rather than buying on another service and importing into iTunes.

[mudaudio]

At first this did strike me as being a petty blow at Apple.

But if you think about this objectively from Universal's point of view... iTunes is a proven success with DRM. Messing with this success - perhaps by tentatively 'testing' non-DRM tracks and for whatever reason reverting back to DRM later - could potentially confuse or irritate the customer, or in some other way rock the iTunes boat.

Universal are obviously sceptical about removing DRM, so it makes sense for them to test the market. If they want test a few things out it's probably best they mess with the smaller stores first, see how it goes and roll out to iTunes when if and when they decide its a good call.

If they, and the media, also spin this to be a move to stir up the competition and put pressure on apple, then all the better from Univeral's point of view.

Regardless, the mere fact that Universal are playing with no DRM is a good thing... And even if they do play with apple for a while, im sure they'll make an iTunes deal eventually

[zv470]

Typical... Universal seems to be totally Microsoft aligned. eg: Universal backs HD-DVD, Apple backs Blu-ray.

[Peace]

It will be real interesting to see how Jobs reacts to this.If I were him I'd pull ALL of Universals music and tell them to..You know.

[RidleyGriff]

I disagree mudaudio -- trying this out in every store but itunes is Universal giving people an incentive to try a music service OTHER than itunes -- nothing more. This move in and of itself -- and their press announcement -- is the definition of confusing the customer (some stores have drm, some stores don't, no uniform formatting, etc), so clearly they have no qualms in that regard.

Furthermore, by introducing something in a smaller store, and not the single most successful retailer, all they are doing is ensuring a) that the drm-free files will find their way out into the wild (it only takes one purchase for this to happen), and b) they will lose revenue on DRM-less files because consumers will not easily be able to find them on the store they use most often (iTunes).

If anything, this move is ENCOURAGING piracy.

The public is also not on their side here, as Apple has a very favorable public image (they're the "good guy"), and the record labels have NO reliability in the eyes of the consumers whatsoever. They only public pressure here will be the pressure that Universal create for themselves.

You are right about the ultimate silver-lining; now that they've announced DRM-free files, it will only be a matter of time before they do the same with iTunes. Because like it or not, that is where the sales are for them.

[kitki83]

I want to make sure I understand the situation

1. Universal is starting a drm free service outside of iTunes
2. Its a testing phase to see if piracy is decreased or not.

I dont know doesnt make sense, how can you make a test of this style and discriminate certain sources. Its like making a research paper but excluding all sides of the argument.

[LethalWolfe]

Originally Posted by zv470

Typical... Universal seems to be totally Microsoft aligned. eg: Universal backs HD-DVD, Apple backs Blu-ray.

Apple hasn't picked a favorite. If you have DVD Studio Pro you can burn an HD-DVD onto a SD disc.


Lethal

[minik]

Don't Universal dislike Apple and/or Sony?! (not meant to bring Sony into the topic.. but a big picture.)

DRM-free is a good way to go, but in general I don't really care as long as I can play the music I bought. Meanwhile, I did upgrade all my eligible songs to iTunes Plus, but none of my other devices (Nokia 6682 and Sidekick 3 in this case) recognize the native 256kbps AAC tracks w/o a workaround.

Nokia 6682 cannot playback anything higher than 192kbps and the Sidekick 3 only likes .mp3.

Anyway, let's see how it goes.

[Schtumple]

Record industry companies move in mysterious ways, often, retarded mysterious ways.

Yet more proof of record companies desperately trying to regain control of the industry, it won't happen...

[mudaudio]

Originally Posted by RidleyGriff

Furthermore, by introducing something in a smaller store, and not the single most successful retailer, all they are doing is ensuring a) that the drm-free files will find their way out into the wild (it only takes one purchase for this to happen), and b) they will lose revenue on DRM-less files because consumers will not easily be able to find them on the store they use most often (iTunes).

If anything, this move is ENCOURAGING piracy.

to me point a) makes no sense. It only take 1 CD to ensure drm-free files find their way into the wild. Furthermore, I'm sure some iTunes users would pirate if given the chance. So the files would for various reasons find their way into the wild regardless of what shops they appear in. Completely agree with point b) though.

I'm only speculating. All I'm saying is if I was running the show, and I wasn't sure if something was going to work, I wouldn't test it on my most successful business model.

And for the record, I happen to support non-DRM content and for many reasons do not like Universal one bit

[MacTheSpoon]

Wow, well, I like Universal even less now. The $.99 works for me, and I don't like their champing at the bit to gouge me on new releases, which is what their frustration with iTunes is all about. I'll be curious to see what price structure they set with these tracks on other services...

[BayAreaMacFan]

Wow. IMO this is Universal trying to play hardball with Apple for not raising prices/giving them a share of the iPod, both absurd requests. I see this as a precursor to taking all the Universal music off the store if Apple doesn't cower to their dumb demands, but eventually Universal will do what Apple wants and what all the other studios agreed to because they aren't going to throw away billions of dollars of revenue in some pissing contest. Also, I don't think it'll have that much of an effect for a few reasons:

a) I would say out of the general population that buy off iTunes most don't know/care about DRM considering a lot of people only play it off iTunes, on their iPod, or burned onto a CD. Apple's sales wouldn't suffer at all because out of this population not many would move to wherever they are selling it.

b) For those that do care about DRM, I think most would go the route of stealing the music for the reasons Job mentioned a few years ago. This would be the easiest route and no one would care about screwing over Universal.

[nemaslov]

If I was an artist signed to one of their labels I would be PISSED!!!

[TimelessWind88]

Originally Posted by Macrumors

This plan is described as a "test" and is expected to run into January of 2008 to gauge user demand and if there is any effect on online piracy.

What an senseless way to "test" DRM-free music's impact on the market by bypassing the, without a doubt, largest online music retailer. Clearly this is more of a snub to Apple than anything else. I just don't really understand Universal's grudge against Apple and iTMS. The worst part about all this mess is that it really hurts the customer in the long run through confusion and irritation.

[Eduardo1971]

Originally Posted by robertnq

Sounds dumb...why would i want to go to another music store open an account...download the song/album....and then load it into iTunes...thats just extra steps and more of a hastle for me...thats like driving 100 miles away to get cheaper gas...not worth it...boo universal!

I can understand your anger, but seriously, chill. Life is very short, there is a war going on (amongst other problems) and your comment sounds very petulant.

Lighten up. I have both an iTunes account and a www.emusic.com account. I can attest that you are totally blowing this out of proportion. I enjoy using both services; each has its own strengths and weakness. Nothing in life is perfect.
Relax.

Peace.