For the past year or so, we’ve been wondering if Big Music’s move to start selling digital music without DRM locks has done anything for sales. And while we were sceptical about the move’s benefits to begin with, we’ve grown increasingly so each month, as our request for sales data about DRM-free tracks has yielded bupkis. Our theory has two elements:
- Beyond a handful of vocal Web users, digital music consumers don’t care know or care about DRM, and don’t have any problem with it. That’s because almost all digital music consumers use the iTunes/iPod/iPhone system, so any music they buy, share or steal works just fine for them, DRM or not.
- If the music labels were seeing significant uptake in DRM-free sales, they’d be boasting about it, because they need to boast about any good news they can get. And it would also give them that much more leverage with Apple, since 3 of the 4 big guys aren’t selling their DRM-free tracks at iTunes.
But finally, we have an admission from one of the labels: Dropping DRM hasn’t made a difference. Via Digital Music News, here’s Warner Music’s Edgar Bronfman Jr. at the Goldman conference yesterday: “DRM on the download business hasn’t really moved the needle frankly, growth trends haven’t changed DRM or DRM-free.”
Now, as we’ve said before, going DRM-free isn’t a bad idea for the labels. There are some tangible benefits — chiefly that it allows music stores not run by Steve Jobs to sell music that people can play on their iPods and iPhones. Amazon’s MP3 store now has something like a 5% to 8% share of the digital music market, we’re told, and supposedly that’s been accomplished without eating into Apple’s sales.
So that’s nice. But we think that we can finally put to rest one of the digerati’s favourite myths: That people would love to pay for digital content — but only if the big bad media companies stop trying to lock it up.
UPDATE: BizWeek’s Peter Burrows says he’s heard from a major label that’s reached the same conclusion. Could be Warner Music again, though we’re pretty sure he’s talking about Universal Music Group:
In fact, one major label has been running a test in recent months with around a dozen big music retailers and online music services to gauge the importance of DRM on purchase decisions.
I’m told these include Amazon, Wal-Mart, BestBuy and Napster (before it was purchased by BestBuy); Amazon denies knowledge of any such test, while the others didn’t respond to my inquiries to confirm their participation. What matters is that so far, the results suggest that DRM isn’t high on consumers’ list of concerns. “DRM-free sales are very good at Amazon and Walmart,” says one source familiar with the test. “But DRM-enabled products are doing just about as well. It could be that we’re just in transition. But there doesn’t seem to be this overwhelming consumer demand for everything MP3.”
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