The Battle over Music Piracy

When Amazon.com announced its plan to open a digital music store to sell MP3s, you had to really work to get excited about it. It's hard to think of a press release that would be less surprising. At this rate, my 3-year-old daughter will be opening a digital music store pretty soon. And Amazon's selling MP3s? It's a digital music store. What else would it sell?

But Amazon's move was actually a strategic salvo in the great secret war of the $60 billion music industry, the fight over Digital Rights Management, usually known by the spine-tinglingly thrilling abbreviation DRM. What's DRM? An invisible layer of software that bodyguards a computer file and limits what you can and can't do with it. Buy a song from Apple's iTunes Media Store, for example, and you can copy the file to five computers but no more. That's because the song comes with Apple's DRM software, FairPlay, baked in, and FairPlay has its own ideas about what is and isn't fair. Most people don't even notice DRM--who puts their music on five different computers anyway?--but there's something annoyingly unfair about FairPlay even in the abstract. You paid for the music. Who is Apple to tell you where you can and can't stick it?

Nobody will admit to actually liking DRM. Consumers feel retailers are treating them like potential copyright criminals. Retailers say they use DRM only because the labels make them. The labels blame us, the customers, for being such filthy music pirates. And around we go. Steve Jobs even swore that he would de-DRM every track on iTunes if only the labels would let him. (Jobs did broker a deal with one label, EMI, to sell DRM-free music, with higher audio quality. But it'll cost ya: DRM-free tracks will go for $1.29 vs. the standard 99¢.) Amazon is saying it's prepared to go skinny-dipping in the digital music pool: the company will sell all-nude, plain-vanilla MP3 files stripped of any DRM.

This won't make Amazon the iTunes killer. There's no way Amazon will match the silky-smooth user experience of the iTunes store--I mean, interface design and hardware integration are what Apple does--or the depth of its song selection. DRM-free music is a nice perk, and the freedom-loving anti-copyright geekerati will be all over it, but there are more important things in life. And Amazon doesn't need to kill iTunes anyway. Amazon's music store will be a handy tool for setting up package deals and promotional giveaways and such, but that's all it has to be: a loss leader, not a world beater.

But all this does bring into stark relief a basic question that haunts the music industry: Can consumers be trusted to control their own music without pirating the record labels and the artists they produce right into the ground? The answer is yes. People have been buying and selling music for years without DRM, in a form you may have heard of called the compact disc. CDs have never had DRM attached. Off the record, most executives--on the technology side at least--will tell you that DRM is a dinosaur that's waiting for the asteroid to hit. It's just a matter of when the music industry will stop assuming its customers are all criminals.

To be clear: most of us really are criminals. Almost everybody owns a little stolen music. But a little piracy can be a good thing. Sure, O.K., I ripped the audio of the Shins' Phantom Limb off a YouTube video. But on the strength of that minor copyright atrocity, I legally bought two complete Shins albums and shelled out for a Shins concert. The legit market feeds off the black market. Music execs just need to figure out how to live with that. (And count themselves lucky. When it comes to movies, consumers actually do act like hardened criminals. The real pirate war is being fought in Hollywood.)

In the end, the real consequences of DRM may have nothing to do with piracy. One side effect of Apple's FairPlay software is that music purchased on iTunes plays only on Apple products--i.e., on iPods. The result is that DRM helps perpetuate Apple's quasi-monopoly in the portable digital-music-player market, which ironically has a slightly Microsoftesque air about it. (The European Union is looking into an antitrust suit.) If--meaning when--Apple drops DRM for good, the playing field on the hardware side will get a whole lot more level and the iPod will have a whole lot more serious competition. Zunes, Sansas and other exotic digital fauna will all be able to play songs from iTunes. Turnabout, as the saying goes, is fair play.