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Yes! They Took the Bait! Music Industry Grumbles About Job’s Vision of a DRM Free Future

A Thing of BeautyA Thing of Beauty Hosted on Zooomr

Jobs’s Music Proposal Rebuffed – washingtonpost.com:

“Edgar Bronfman Jr., chief executive of the Warner Music Group, said in a conference call with analysts yesterday that Jobs’s stance is ‘completely without logic or merit.'”

“‘We don’t think that a wholesale abandonment of DRM is necessary,” added Mitch Bainwol, chairman and chief executive of the RIAA. “I think you’ll see some experimentation, but that’s a lot different from a policy saying ‘forget it.’ “

Ok, so earlier this week when Steve Jobs penned his beautifully crafted anti-DRM missive, thoughtfully entitled, “Thoughts on Music,” I wrote a post about Steve Jobs being a marketing genius. And my point is beginning to be made here.

The quote above by Edgar Bronfman, Jr. (what a name) may have just as well come from John Hodgman in a hospital gown with a cam strapped to his head.

Just like Bill Gates took the bait complaining about Apple’s recent ad campaign that portrays the PC as an overweight sickly virus ridden machine, again, with a hillarious cam strapped to it’s head, Edgar Bronfman Jr. and the rest of the music industry just took the bait on DRM. I’m still waiting for the next Apple commercial that has Hodgman with a kick me sign on his ass.

And the louder they complain, the better it will be for Apple and Jobs. Why? Because at this point if the music labels dropped iTunes there would be outcry and backlash of massive proportion with the winning message being, screw them then, I’m going to Limewire… opps, I mean Acquistion.

The labels are too far immersed into iTunes as the the leading seller of online music at this point to back out now. What’s more, any attempt by the music industry to raise prices from here (and they are still burning up inside about the screwing they took when they didn’t think to ask for a piece of the hardware pie from iPod sales) will only allow Jobs to portray them not only as DRM loving scum but as greedy DRM loving scum. Obviously I exaggerate to make the point. Jobs would be much more eloquent with it all than I am blunt.

At the core, what Job’s anti-DRM missive is about more than anything (irrespective of the fact that he’s totally right and I’m sure believes in what he wrote) is a marketing message that resonates with future buyers of Mac computers, iPods, and most importantly iPhones.

Apple makes the best consumer technology in the world right now. The Mac is vastly superior to the PC. The iPod is better than the Zune. The iPhone will be one of the best phones ever. And… you almost thought I was going to say that iTV was the best way to consume television didn’t you? Psyche. (Although CableLabs watch out, your turn is coming next)

But the point is that making the best hardware isn’t enough. The real genius behind Apple’s business is not even building a better mousetrap — it’s design, style and marketing. It’s fashion. It’s the difference between a hip young nerdy looking Justin Long vs. John Hodgman with a bad haircut alternating between a hospital gown or a suit from the 80s.

Everybody hates DRM and the RIAA. Hating DRM is like hating bigotry or hating racism or hating those horible predators that Chris Hanson grills on NBC’s “To Catch a Predator.” Again, I exagerate to make a point.

The funny thing is that the more that people like Bronfman now bitch about how wrong Jobs is and how important DRM is, the more the volume gets turned up and the more the popular tide shifts to Job’s message (which again, emphatically, is the right message).

Look, after Jobs penned his masterpiece earlier this week you even had Cory Doctorow himself, the father of all anti-DRM, cautiously and suspiciously saying, “well, Ok, that’s cool, I think…”

The music industry at this point has two things that they can do, and in both cases Jobs wins.

The first thing they can do is continue to grumble and bitch about DRM. And every few weeks or so Jobs will let a comment slip here or there about how they are wrong and he’s right, and he’ll get standing ovations over it and believe me, the marketing team at Apple will craft some real zingers for him to drop into the right media moments.

And it’s not so bad if this happens anyways. After all iPods are largely sold based on illegal music. Of the 97% of tunes on iPods that Jobs quoted in his article, how many of those do you think were legitimately ripped from people who still own those CDs (Amoeba Records is a great place to sell your used CDs by the way and they have an innovative 7 day “insurance” plan just in case you buy CDs that you don’t like a few days latter, wink, wink). So who the hell cares about iTunes. It’s irrelevant. It offers Jobs a valid defense to the argument that iPods are basically filled with pirated songs and that’s all that really matters.

The second thing the music industry can do is capitulate and give in, and begin offering DRM free music. This is the right thing to do by the way… but the music industry doesn’t always do the right thing, it’s run by idiots.

Now if this happens everyone will point to Job’s anti-DRM (at this point in the canon of great computer literature) letter as being the catalyst for all this great change.

Jobs wins again.

So, NYPost. Keep printing headlines like Bronfman Rips Jobs. But know that when he reads that he’s slamming his palm down on his granite countertop kitchen (complete with Sub-Zero everything) and jumping up and down yelling, “YES! They took the bait.”

Now that’s what I call a win/win…

…well, unless you’re the record industry — but even there it’s a win, they just don’t realize it yet, just like they thought the VCR would be bad for their business once a very long time ago.

Genius, Jobs, pure genius.

Oh, and if anyone wants to check out my gallery of Apple imagery you can check it out here on Zooomr (which, by the way, is a cool and awesome site built on Macs, hehe).

Disclosure, of course, I’m CEO of Zooomr.

32 Replies to “Yes! They Took the Bait! Music Industry Grumbles About Job’s Vision of a DRM Free Future”

  2. The idea that the labels “took the bait” is hilarious.

    The fact is that many companies have been urging the labels to head in this direction for some time, both privately and publicly. This is the direction the industry has been considering shifting for some time.

    What’s really happening here is that Steve Jobs saw a parade coming down the street, and jumped in front of it waving a baton like it’s his parade.

    If Steve Jobs put out an essay, “Thoughts on Sunrise” and then the sun came up the next day, would Jobs then be credited with making it happen? Seems like an apt comparison here.

  3. From what I understand it, it’s not so much that the music labels didn’t think to ask for a piece of the iPod hardware pie but that Jobs refused to give it to them and they caved.

  4. Do you really think DRM is the problem with online sales?

    I’ve bought some iTunes. They don’t sound bad, but they don’t sound as good as a CD do they? The CD comes with actual (and all of the) artwork and liner notes. Not so iTunes (or Rhapsody, Zune, Music Match, or whatever). Real CD’s have a larger catalog than any of the online stores. Do a little bargain bin shopping and you can get your favorite CD’s for close to online prices with all of the goodies just mentioned; better sound, better artwork, and liner notes.

    I’ve bought iTunes. I’ve burned ’em to CD and played the CD in my car, in my annoying Windows computer at work, in my daughters boom box (Halloween Mix) while handing out Halloween candy. They worked fine … no real DRM hang ups. Personally, I think this whole DRM brouhaha is whining started by a bunch of tight wad techno geeks who like their music like they like their software – free and open source! Then media/bloggers looking for ratings/hits rolled this “terrible” injustice into a big deal.

    If DRM was such a big, fat, hairy deal Apple’s iTunes store would not be the decent sized hit it has become. If the digital download offered a more comparable package to the CD it would probably be an even bigger hit. I like my liner notes: Who is the sax player on that track? Is that Michael McDonald doing background vocals on yet another album? What are the lyrics on that song?

    Trust me, it is the value equation. Saving only about five bucks on an digital album (especially when there are not the manufacturing, packaging, or transportation costs for the music labels when distributing online) in exchange for audio quality, nice & complete artwork, and liner notes is the reason downloads haven’t completely destroyed the CD – not DRM.

  6. Everyone in my house has gone 100% iTunes. No more CDs, period. Now that there’s a way to get tracks from iTunes Japan, even the occassional j-Pop import CDs are a thing of the past.

    Many people are missing the point that for a lot of music consumers, having to shop in a physical store was always a negative. Shopping at Amoeba is a PITA if you’re not a hardcore music nerd. It’s crowded, you have to coat-check anything bigger than your wallet and I don’t particularly care for their organization. And don’t get me started on the “I’m too cool for the likes of you” attitude from many on staff at Amobea. Best Buy/Target/Wal-Mart aren’t even on the radar for music, at least in The City. Independent stores can be good places, but they can also be filled with the “I’m too cool for you” crowd.

    So we use iTunes. The *only* place I’ve ever heard people complain about the bitrate and the DRM on iTunes tracks are on blogs! No one in my wide wide circle of friends has even mentioned it. The DRM isn’t an issue because owning a non-Apple music player is just not an option for the majority of people: “Hey, what’d you get for Christmas!?” “A Creative Zen!” “What’s that???” “An MP3 player!” “Oh. pregnant pause Why didn’t you just get an iPod? confused look“

    Artwork and Liner notes – again – something only the most devoted fan really cares about. Lyrics – most of those can be found with a simple Google search.

    On the other hand not having to pay $15-18 for a CD is very good. Being able to legally get just the two decent tracks from that album, even better! Another no-brainer tradeoff for a lot people.

    I think CDs will continue a steady decline in sales as those who are untrusting or unfamiliar with online distribution continue to get older, replaced with consumers from the other end of the age spectrum who have known nothing but online distribution. It just takes time.

  9. Ah. I was about to take the “Built on Macs” bait until I realized the difference between “Built on”
    and “Runs on”. Well either way, that’s fantastic given there’s no #$%^&* Microsoft in there.

    As for DRM. Screw the RIAA and go get your music from allofmp3.com or some P2P place, because you know little to nada of the money you pay to iTunes actually gets into the pockets of artists anyway.

    Great post btw, Thomas.

  10. As I view it Jobs’ intention i dont believe was to persuade the labels with his words but to claim the facts about DRM and the laws in Europe and how they oppose iTunes with their laws.

    Jobs letter was more to persuade the public if they want DRM free music then it is their duty to rise up to the labels and demand it.

    I think Jobs’ also proposed this idea so Apple does not continue on the same path of being the most major role in portable music players with its iPod and being the largest online digital music distributor with the iTunes Music Store. They want to have a healthy ecosystem of competition and its not happening because none of their competitors can offer anything close to the Apple formula to date, not even Microsoft with the Zune.

  11. Jeff, you said ” …..iTunes are basically filled with pirated songs and that’s all that really matters.”

    I think you mean iPods are basically filled with ….

  12. Make no mistake, the bait wasn’t for the labels, it was for his cult.

    You are right, Jobs is a master of marketing, but not in how he handles the RIAA, it’s in how he has made you love Apple and him in an entirely non-logical way. He has stroked a passion in you that is usually only reserved for fundamentalist nuts. He has you ranting and raving over the glories of all things Apple and now you’re just another rabid, brainless follower.

    The RIAA could care less how the world views them. Everyone already hates the RIAA and have for a long time. There is no bait to rise to, there is only the delusions of grandeur that you’ve projected upon all Saint Jobs does.

    I can’t really blame you though, as the creative crowd always wants bold, passionate moves; they want to color outside the lines, to give the finger to the Man, to draw a line in the sand, to secretly get back at the jocks and to give them validation. Hell, I’m right there with you, I have my fair share of ink and subversive musings but I’m also a programmer so I can’t help but view Apple from a position of logic instead of this burning in the bosom that he lights in the pure creatives. What I find even more hilarious and sad is that the iPod and it’s spawn are the ultimate in generic, they would look right at home with ACME printed across their white bodies. Apple is also the least about sharing and Jobs probably secretly hates the creative commons because he has an iron fist over all things Apple. Want to develop for the iPhone? Forget it. Want to license FairPlay? Forget it.

    The only thing Jobs has done is deftly turn the star-stuck eyes of his followers towards the labels and away from himself. People often decry how Gates and Microsoft should use their power to break the DRM lock, to do this or that, to force positive change YET when that eye starts to drift towards Jobs he waves his hand and magically appears to be the poor David to the RIAA Goliath, his hands tied behind his back, unable to do all the good that he wishes he could.

    Jobs has the power and position to actually make real change, to actually put himself on the line for the ideals he supposedly believes in and his hands are not nearly as tied as he likes to make out. He has conned his core followers and turned not licensing FairPlay into taking a stand against the man. As far as cons go, he is the ultimate grifter.

  13. Eric in SF:

    I agree, the too cool indie scene at smaller music stores can be a drag. Personally I’ve found the best sources are BestBuy if it’s a popular CD, straight from the band’s website if it’s not and then emusic.com for everything else.

    I am confused about paying $15 – $18 for a CD, as I haven’t spent more than $11 for a physical CD on even new releases for years. Usually BestBuy has them the same day as iTunes for $9.99 and often the local indie bands are selling their wares for $10. Actually, I was just in San Diego and picked up a local SF band, “Diego’s Umbrella”, CD for a straight 10 spot.

    I also have a wide circle of friends with music players but none of them question why I bought a Zune over an iPod nor do I question my friend’s that listen to all their music via their cellphone instead of an iPod. We spent all our time talking about music, not the players themselves and the only pregnant pauses come from when one of us mentions our undying love for a hair band or secret crush on some current pop diva. I have noticed that that younger, high school age crowd are still into which device you own but I’ve also started noticing a new trend where many of them purposely don’t want an iProduct because that’s what their parents and all the “old people” have.

    Artwork and liner notes, again, I agree, not really something I spend much time looking at though I do wonder if they’d still produce album art if there were no CD’s to sell.

    I agree in part that CD’s as a distribution mechanism will drop off but I don’t believe it will happen until there is a more standard form of digital distribution. iTunes can never be “The Standard” simply because at that point they are a monopoly and would be forced by the government to either split up (think Ma Bell) or open up their platform (think Microsoft Anti-Trust). Personally I think Jobs knows this and is walking a thin line, he doesn’t want to get too big otherwise he’s subject to regulation yet he still wants to maintain his market share.

    I will say I do think the quality is lacking in most digitally distributed tracks. I never notice it on my Zune or friend’s iPod but I do on my higher end home stereo. It’s also a matter of having something to compare it to. I had no idea some tracks I had were so flat until I heard the actual CD cranked up in a friend’s car and relistened to my digital versions. Some very obvious compression at higher volumes.

  14. Does Jobs take his dick out of fans mouths when they write this shit? “Mac superior to PC, ipod superior to Zune”, he left out itunes. I’m not a fanboy for MS, but in a single gen, xbox 360 has taken on Sony and I wouldn’t overlook gen 2 of the Zune. If you’d read Hodgman’s book, you’d know that he’d make a far superior computer. People copy from nerds, not the cool kids!

  15. My question for Steve is “Why won’t you allow a subscription service for iPods so that people can discover lots more music for one reasonable price. I had a Napster account and loved the ability to listen to ANYTHING I was curious about, and the whole songs, not just 30 seconds that Steve gives you.

  16. My question for Steve is “Why won’t you allow a subscription service for iPods so that people can discover lots more music for one reasonable price. I had a Napster account and loved the ability to listen to ANYTHING I was curious about, and the whole songs, not just 30 seconds that Steve gives you.

  18. Hopefully none of this matters. In a decade or so all of the “major” labels will have closed operations and you’ll just have large communities of artists (much like Atlanta or Seattle) where a musician can make a nice living off local sales, tours, merchandise, etc. If their music can stand the sands of time then they will live on as legends because the music is that good.

    Should someone like Britney Spears really make $20 million from an album she spent less than a month to record? Especially an album she didn’t write or arrange. She’s just yet another tool built by the labels.

    That’s ridiculous.

    btw, if macs had penis’ this guy would have apple sauce all over his face.

  21. Good post and analysis. However, I just had to make a statement about the “Macs make better computers than PCs” statement. As long as I hear Mac enthusiasts ballyhoo around this, it shows how little they know.

    Macs don’t make their computers. It’s the same as a PC, in a Mac shell. And often they lack technical qualities, for example the MacBook Pros hard disks aren’t up to par with the faster ones in notebooks like the LG or Sony Vaios.

    The only things that seperate Mac from Windows PCs is a) the OS and b) the branding. Most Mac fans are victims of branding and propaganda. At the technical level is where critiques should be made.

    And I admit, Mac OS is quite excellent. Their own stances on DRM aren’t, I’m afraid, and this ploy by Jobs is political leveraging with the music industry. Apple wants to protect its proprietary rights and IP just as much as anyone else, and they’re even more diligent in some ways than even Microsoft.

  22. Absolutely brilliant Thomas…it’s insight I had never seen on the Steve Jobs situation. Clearly, music without DRM will benefit the industry but they haven’t realized it yet. And Jobs’ master stroke will surely improve Apple’s prestige in the eyes of music consumers for future generations.

  23. So I guess Apple will be releasing Quicktime to open source to ensure Mr. Job’s DRMless vision is complete.

    NOT!!!

    Please Jobs is doing more harm than good by playing both sides of the fence against each other.

    Everyone knows Steve is doing all this lip flapping to sell more Apple junk.

    Not for consumers, not for artists and certainly NOT for anyone but Apple.

    PERIOD!

  24. Why can’t people just focus on the “No DRM” part of Jobs message, its such a waste of time to over analyse this crap, its only started (being totally ignored) and people are worried who ultimately might gain the most, well F you!! Owning a legal DRM free music library is all I give a crap about. If Jobs gets a shit ton of $, who cares? iTunes is in fact a big player, and they now are open to DRM-free music sales … you uptight fools, straighten your laced panties and look on the bright side!

  25. Thomas, I agree with you…Jobs is a master and he’s getting the effect he wants. As you mention, he’ll drop a few more zingers over the next few months.
    It’s the same thing he did with Eisner (Disney) with the Pixar distribution rights and look what happened, Eisner out, Jobs a few billions richer.
    He’s put the studios in play, they just haven’t realized it yet!

  26. “After all iPods are largely sold based on illegal music.”
    — That’s a bit of a leap. Anyone I know has ripped their CD collection onto their iPod and that form sthe base of their music on it.

    Shawn Oster — you don’t get it, and you’re never going to get it. Programmers rarely do. It’s a fundamental difference in thinking. Saying you can rationalise what’s happening and it’s silly, is like saying a hug is silly because all your doing is being near someone.

    Techies don’t get ‘cool’ — that’s why they’re techies, but they try to dismiss it and rationalise it away, because if it’s silly, then it doesn’t matter anymore.

  29. It may be that the music industry will fail to move away from DRM until it is too late. The folks in charge seem to have little-to-no clue about technology and the online community. They are acting as if they are still in the horse-and-buggy era while the rest of the world has discovered the internal combustion engine. If this is the case, they will either go out of business as the buggy manufacturers of the day did, or they will adapt to the market reality. We—as consumers, or our government—need not intervene in their demise, as obsolete business models need to die quickly so new ones can take their place.

    The Mac is vastly superior to the PC.

    The tool doesn’t matter much if the user doesn’t know what he or she is doing. A heavy-duty Snap-on air hammer (SID: AT148A) in the hands of a chimp might as well be a hunk o’ granite.

    Oh, and if anyone wants to check out my gallery of Apple imagery~ (which, by the way, is a cool and awesome site built on Macs, hehe).

    The quality (or lack thereof) of the HTML of your page illustrates my point exactly.

  30. Great article!

    What If The Big Four Music Companies Tried “A Day Without DRM”?

    What I would like to know is why doesn’t the music industry allow us to put our money where our mouths are? Why won’t ONE of the big four music companies (Sony BMG, EMI, Universal, or Warner) try no DRM … 3 months … 1 quarter is all we ask. Open up the entire catalog on all legal download stores … make [us] the consumer put our money down and PROVE that we would support a system of open DRM. Also make Apple (and Steve Jobs) prove the sincerity of this statement:

    “… abolish DRMs entirely. Imagine a world where every online store sells DRM-free music encoded in open licensable formats. In such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players. This is clearly the best alternative for consumers, and Apple would embrace it in a heartbeat. If the big four music companies would license Apple their music without the requirement that it be protected with a DRM, we would switch to selling only DRM-free music on our iTunes store. Every iPod ever made will play this DRM-free music.”

    Make Jobs write another essay about the full disclosure of the trial deal of 90 Days Without DRM.

    I wrote more on my blog at FIXYOURTHINKING.COM

  31. Jobs’ statement is very interesting.

    Who’s the most invested in DRM? MS!

    They’re shipping Plays for Sure, Zune AND the latest – mobile DRM PlayReady. That’s three, count them.

    Does anyone know how to spell CONVICTED MONOPOLIST USING DRM TO MAKE BILLIONS?

  32. music industry to raise prices from here (and they are still burning up inside about the screwing they took when they didn’t think to ask for a piece of the hardware pie from iPod sales) will only allow Jobs to portray them not only as DRM loving scum but as greedy DRM loving scum. Obviously I exaggerate to make the point.I read this article it is very interesting and useful .
    Click on the page to find similar article
    Music Industry

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