DRM, AAC and iTunes Store lock-in

Onto my first opinion post. Originally when the EMI/DRM news came out I was going to do a post (albeit shorter than this one) all about that. Well in the end I never finished and it ended up as only a couple of lines in my weekly stuff. Since then I have heard and read quite a few media reports on this and most seem to be treating Apple as though they are the Microsoft of music. I think that is completely wrong, so I wrote this new article :)

Now before going into the article it is worth noting that I have owned 4 Macs (2 still in use), Ruby and I each have an iPod and I have purchased tracks from the iTunes Store. So, yeah, I do like my Apple stuff. Hopefully this will come across as a balanced article and not too much of an Apple fanatic...

Digital Rights Management

I think the announcement by EMI and Apple that all their tracks will be available in May DRM free is really big news. To me this is the beginning of the end of DRM. I really don't like DRM as it restricts what you can do with your music and treats you as if you are a thief. This does not really encourage me to buy new music!! I can buy a CD, play it in my car at home or rip it and put it on my iPod, Phone or mp3 player. With Apple's DRM (called Fairplay) I am restricted to playing only in iTunes or on an iPod. However, it is worth noting there are a couple of simple ways to get around this (not that I have bothered).

Now some of the media reports on this announcement have been interesting as well as a bit misleading. They have focussed on the fact that price of individual songs has increase by 30% (this is for the US store, the Australian price has not yet been announced). Some have mentioned that the quality of the songs has doubled. However, very few have noticed that the prices of complete albums has NOT increased.

AAC files and iTunes Store lock-in

Another thing many of the media reports have been focussing on is that Apple's iTunes store locks you into using an iPod and the change in DRM makes no difference to this. Apple does not use the MP3 format for the iTunes Store (though the iPod can happily play MP3s), instead it uses AAC. Now many in the media seem to think this is an Apple only format (Apple Audio perhaps!). It is not an Apple format, AAC is an international standard just like MP3 and can even be thought of as a successor to MP3 (have a look at John Gruber's excellent post on AAC for a good explanation). Other devices apart from the iPod can also play AAC like the Sony PSP and PS3, Sony Ericsson phones , some Nokia phones and the Xbox 360.

Unlike Microsoft, Apple do not want to control music. What a lot of people forget is Apple makes most of their money of hardware sales (Mac or iPod) as these have a generous margin. Apple instead uses innovative software solutions (such as the iTunes Store, Mac OS X, iMovie or Final Cut Pro) to help drive software sales. It is also worth noting that the iTunes Store makes very little profit.

It is also worth reading Steve Job's Thoughts on Music essay. Also, this announcement from EMI is not just restricted to Apple's iTunes Store (see this Q&A transcript). EMI has made the DRM free tracks are available to any of the other digital music stores.

So its really great that we can now buy some digital music with DRM removed! However, this is only the first step, its time for the other large music companies to follow suit. Oh and hopefully EMI will soon make the Beatles catalog available too :)