Jobs Hits DRM Nail Right on the Head

• By Carolyn April
• 02/08/2007

It's a major flip of positions for Jobs, who has long been thought to have a master plan of shackling iPod owners to iTunes exclusively. And yet, his change of view is not altogether surprising given this very big fact: DRM isn't working. If you're Jobs, why not get out in front of its demise? That certainly seems to be the MO behind his open letter this week on this subject.

So what's wrong with DRM? For starters, as with any security measure, hackers can find their way through DRM encryption codes, which forces each proprietor of these systems -- Apple, Microsoft, Sony, etc. -- to develop new DRMs after each breach. It's a pain.

Secondly, as Jobs points out, the argument for using DRMs -- to protect copyrighted music sold by the major music companies -- is specious. These same songs you buy online through iTunes, and can't play on any device other than an iPod because of DRM, are sold in CD form at your local music store. Physical CDs don't employ DRM systems and are easily uploaded to any computer, where they then can be downloaded to any music player, whether it's an iPod or Microsoft's Zune.

Jobs made another interesting point backed by numbers. Much of the complaining from users about being restricted to one online store's music versus another's is actually much ado about nothing. The vast majority of music downloaded onto iPods -- 97 percent of it -- is not purchased at the iTunes store, but rather is acquired through the aforementioned home CD collection or downloaded from some plethora of non-DRM-restricted music on the Internet. (If I might attest to this reality, having never purchased a song off iTunes, my own iPod is filled with freely and legally available music from the Web.)

To be fully on the level here, Jobs presented three alternatives for dealing with the online music conundrum today: One choice? Keep the status quo, which means proprietary DRM systems, proprietary online music stores and proprietary players that don't interoperate. The next choice happens to be the option that Jobs deems worst, which would be for Apple and others to license their DRM systems to one another to enable interoperability. The problem with this tack is that fixing the inevitable hacking breaches becomes exponentially more complicated when multiple vendors are involved. The third option, which Jobs says Apple will embrace, is to kiss DRM goodbye.

To do this, music monoliths like BMG and Universal must agree to cede at least some aspects of the copyright battle and let consumers buy their music without restriction from online stores of their choice. Whether you lament this or not, the fact is that online music is the eventual death knell for CD sales and there is virtually no preventing this market dynamic from happening. Jobs might be self-serving with his DRM flip-flop, but he's also no dummy in seeing that trying to keep such restrictions in place is not going to work in the long run.

Bottom line: Consumers want choice and variety.

What's your take? Write to me at [email protected].