[Infowarrior] - Universal Music Will Sell Songs Without Copy Protection

[Richard Forno]

Universal Music Will Sell Songs Without Copy Protection
By JEFF LEEDS

http://www.nytimes.com/2007/08/10/business/10music.html?_r=1&oref=slogin&pag
ewanted=print

Signaling another departure from the music industry¹s longtime antipiracy
strategy, the Universal Music Group will sell a significant portion of its
catalog without the customary copy protection software for at least the next
few months, the company announced yesterday.

Universal, the world¹s biggest music conglomerate, said it would offer
albums and songs without the software, known as digital rights management,
through existing digital music retail services like RealNetworks and
Wal-Mart, nascent services from Amazon.com and Google, and some artists¹ Web
sites.

But the music will not be offered D.R.M.-free through Apple¹s iTunes, the
leading music service. The use of copy protection software has become a
major bone of contention in the digital music business, where iTunes
accounts for the vast majority of download sales. The record labels
generally have required that retailers place electronic locks to limit
copying of music files.

But Apple¹s proprietary D.R.M. does not work with most rivals¹ devices or
software ‹ meaning that music sold by competing services cannot play on
Apple¹s popular iPod. Some record executives say they believe that the
stalemate has capped the growth of digital music sales, which the industry
is relying on more heavily as sales of plastic CDs slide.

The offer of Universal¹s music under the new terms is being framed as a
test, to run into January, allowing executives to study consumer demand and
any effect on online piracy. A Universal decision to adopt the practice
permanently would put pressure on other record companies to follow suit.
That could stoke a wider debate about how to treat intellectual property in
the digital era. Universal¹s artists include the Black Eyed Peas and 50
Cent.

The effort is likely to be seen as part of the industry¹s wider push to
increase competition to iTunes and shift leverage away from Apple, which
wields enormous influence over prices and other terms in digital music. A
month ago, Universal notified Apple that it would not agree to a new
long-term contract to sell music through iTunes.

Steven P. Jobs, Apple¹s chief executive, made his position on copy
protection software clear in February, when he posted a statement on the
company¹s Web site calling on the record companies¹ to abandon their
insistence on D.R.M., which he argued had largely failed to resolve the
industry¹s piracy woes.

So far, only one of the four major music companies, the EMI Group, embraced
a wholesale shift away from the usual approach. EMI, which releases music by
artists like Norah Jones and Coldplay, first struck a deal with iTunes in
which songs without copy protection (and with better audio quality) would be
sold at a higher price ‹ $1.29 instead of the usual 99 cents for the
restricted songs.

EMI has said the results so far have been promising. Under Universal¹s
arrangements with digital retailers, at least some of its new music will be
sold in unprotected form for 99 cents, company executives said.