Fri Aug 10, 2007 11:32 am

I suspect if this is a modest success, we'll see Universal DRM-free songs on iTunes. If it's a failure, Universal will incorrectly assume that selling DRM-free songs is not viable (where the more likely reason it wasn't successful was because iPod owners, in majority, want to purchase from iTunes). If it were a raging success, Universal would not sell DRM-free songs on iTunes, and maybe even pull their catalog entirely, because they wouldn't need iTunes to sell music online. However, I find that scenario extremely unlikely.

Fri Aug 10, 2007 12:42 pm

2 thoughts:

1) how many people buy music online at Walmart, RealNetworks and Amazon compared to iTunes? Doesn't everyone already have an iPod (and therefore iTunes installed on their computer)? Apple has made it so easy to buy the music in the first place. That's why they have been so successful. I doubt this will go very far.

2) Will the buyer's info be encoded into the songs like Apple does (even with the DRM-free tracks)? If not, I'm sure we'll see this stuff hit the P2P networks as soon as it's sold. I actually like that Apple left the info in the tracks. Overall, I think it will make it less likely that someone will share it with the world. I think casual sharing is not so bad. Remember copying CD's to tape? Or better yet- tape-to-tape "dubbing" as it was called? (I bet some of you don't.) It didn't bring down the music industry. But sharing music with everyone on the 'net is just plain wrong.

Fri Aug 10, 2007 3:16 pm

Of course, this was the huge gamble in Jobs' DRM elimination gambit. Nobody saw it at the time, and apparently, Apple didn't game this scenario or didn't think it was terribly risky. What Universal is going to try here is to act as power broker to make the other stores more popular. The problems for Universal are that (a) DRM'd music is still selling well as evidenced by Apple's consistent march toward 200 trillion song, and (b) at $1 or $10, buying experience comes into play for most consumers and you flat out cannot beat iTunes and iTunes Store. Or if you try, you end up terribly niched with a second class playback device.

Whether you like how the music industry treats customers -- I happen to think they are fair players in a tough game -- you have to admit that they are beyond stupid when it comes to embracing real channels (as opposed to old Napster). iTunes Store is a growing channel tossed right in their lap, and they're rebelling by trying to seed other stores in their image. When you talk to old guard music execs (as I have since I know a couple), they are still in 2007 fearful of the Internet and the iPod. Yeah, they're a "threat", but they're the market people. These guys were fearful of the CD in 1990 no doubt.

Fri Aug 10, 2007 6:53 pm

Guest, I was talking about paying customers, not your Dungeons and Dragons club.

Fri Aug 10, 2007 9:37 pm

Universal's scheme is clear. These other services a subscription based service where the consumer is renting the music. When the customer leaves, they can't play the song anymore unless it's re-ripped somehow. Besides, Universal wants a tier pricing structure where the newest and most popular music goes for the higher price. That's what they want and that's why they don't want to deal with Jobs. They may succeed if they apply enough pressure to the other labels.