Monday, April 2, 2007

Let the Revolution Begin

In yet another groundbreaking announcement involving Steve Jobs and the digital music industry, EMI and Apple came together earlier today to announce the beginning of a new era in digital music sales. In may, Apple will begin selling EMI's entire digital catalog without any DRM wrapper. Alongside the DRMless format, the unprotected tracks will feature "higher fidelity" than the previous offering. However, there is a catch for all these great new features. The consumer is going to have to hike up a little more cash. These new tracks will cost 1.29, or 30% more than the previous offerings. These tracks are going to be marketed as premium tracks, and will be sold alongside the regular tracks that are already on the iTunes Store.

I am feeling such a mix of emotion regarding this announcement. Lets start with the positives.

This has dealt a huge blow to the digital music industry. When one of the biggest label groups, which accounts for "70% of songs sold today", decides to go against the grain and offer there music in an unprotected format, the implications and the stakes are at an all time high. Apparently, EMI has done their research and found that people would prefer to buy unprotected tracks at a higher price at about a rate of 10 to 1. EMI's confidence entering the digital market without any armor to protect them is quite inspiring and will definitely be closely watched by the other big 3 label groups.

Another positive that should have happened a long time ago is the increased fideltiy in the audio tracks. This is long over due, and should help EMI sell more music for all those high fidelity nerds out there. I think that for some, the increased fidelity will prove to be as much as a selling point as the DRMless format. The details are a little scarce on the increased fidelity, so it will be interesting to see how this turns out.

Now to the negative aspects of this announcement.

Obviously, the price hike is not a positive to this development. I think that music has become so ubiquitous and a part of our daily lives, that the last thing the digital music market needs is a price hike. EMI and Apple are banking that the pros outweigh the cons of the price hike.

Another problem with this is that this is the first time that Apple has really strayed from its consistent pricing model of $.99 model per song. I think the labels will now see this as a weakness in Apple's seemingly impenetrable negotiating armor, and they will definitely try to exploit this.

For some users this could be seen as a step in the wrong direction for those who iTunes to have an optional subscription model. Apple has always been dedicated to the idea that people should own their music, and this announcement is just one step further into that model.

Its obviously too early to really see how the public will react, but the promise for the digital music industry seems a little brighter without the darkening shadow of DRM looming over.

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