IN THE BLEAK WORLD of digital rights management, wireless service providers may actually serve as a beacon out of the darkness.
But don’t count on it.
Anti-piracy software may be nearing a crossroads. A handful of record labels are beginning to experiment with DRM-free music, releasing singles without the restrictive technology, and distributors are eagerly jumping onboard.
Yahoo Inc. made headlines in July by offering “A Public Affair” from Sony BMG artist Jessica Simpson as a standard, unrestricted MP3 file. The $2 price tag allowed music lovers to download the tune to a computer, burn it to a CD and play it on nearly any digital music player.
The Internet giant continued the experiment by selling an entire album by artist Jesse McCartney without copyright-protection software (the company also sold the offering as a DRM-wrapped Windows Media Audio file), and in December Yahoo began selling a DRM-free version of Norah Jones’ “Thinking About You” for the
industry-standard 99 cents.
The movement-if that word is merited-has been hailed by bloggers and music lovers who’ve long crusaded against the technology. But experimenting with DRM-free music is a dangerous game for the music business, according to Mark Kirstein, vice president of multimedia content and services for iSuppli Corp.
The DRM nightmare
“In my view, it’s an absolute disaster for the record labels,” Kirstein said. “I think we have bad DRM in the market right now-there’s no interoperability, it’s not consumer-friendly. DRM should be invisible. But at the same time, the answer isn’t to open the floodgates.”
Indeed, nearly every player in the value chain-artists, record labels, distributors and consumers-seems to hate the current state of anti-piracy software. The handful of “solutions” has resulted in a fragmented market where users often buy an iPod, Zune or other device and are locked into a proprietary DRM and committed to a single online music provider.
Even Bill Gates blasted DRM, complaining that it’s easier to “just buy a CD and rip it.”
“No one has done it right,” Gates told a group of bloggers.
Nowhere is that more obvious than in wireless. Behind-the-scenes haggling over royalties continues between MPEG LA, which holds patents for Open Mobile Alliance-supported DRM technology, and industry associations such as the GSM Association. Amazingly, the groups have been at odds since January 2005, when the licensing clearinghouse’s proposed royalties were blasted by the GSMA as unreasonable and excessive.
The standoff hasn’t stifled the race to deploy protected content, however. In their haste to move music and other goodies to market as quickly as possible, carriers have embraced a variety of anti-piracy solutions-often leaving consumers unable to take content with them as they upgrade phones or switch service providers. And network operators sometimes use different DRM software for varying types of content, requiring one media player for music, for instance, and another for video.
Marlin pushes for solution
The music industry is increasingly looking to wireless as a key distribution platform, though. Four of the world’s biggest consumer electronics giants last week pushed what they hope is the solution, releasing its DRM offering to commercial adopters. The Marlin Trust Management Organiz-ation-comprising Panasonic, Royal Philips Electronics, Samsung Electronics Co. Ltd. and Sony Corp.-released certification, management and renewability services for its Marlin technology.
The group hopes to provide “flexible sharing of content both in a consumer’s home networking environment and in situations where a consumer wishes to share content across networks” by replacing the current assortment of electronic locks that allow content to be used only on a single manufacturer’s device. Sony and Philips are also behind the Coral standard, which reportedly is fully compatible with Marlin.
And content owners are looking to network operators to somehow find a way to embrace Marlin or another platform that can move beyond wireless into the larger arena of digital music.
“Although they haven’t shown themselves particularly attracted to an open environment, wireless operators have the potential to be very important in the marketplace,” Kirstein said. “I think the recording industry has already recognized this.”
Of course, mobile network operators appear unwilling to play nice. In their efforts to become a kind of wireless iTunes, Verizon Wireless L.L.C. and Sprint Nextel Corp. have each adopted proprietary DRM solutions for their full-track download services. And Cingular Wireless L.L.C. has integrated with several online music distribution services, each of which uses proprietary DRM solutions.
But analysts say carriers likely haven’t made any long-term commitments to specific copyright-protection technology, and optimists hold out hope that the wireless industry can come to terms on the OMA-supported solution. As carriers continue to add subscribers to their music offerings, though, they’re less likely to embrace an open platform, opting instead to force “stickiness” with DRM that serves as an obstacle for users looking to switch wireless service providers.
“I’m not certain they have the motivation (to adopt a standard technology); their tendency has been more or less like Apple’s,” Kirstein said. “They’ll mimic what’s been happening in the marketplace . which is terrible for consumers.”
