eMusic Can’t Sell Their Product: Whines About Apple’s Potential iTunes Plans.

Back when Apple announced the Safari web browser for Windows, Mozilla missed a great opportunity to plug their Firefox browser, choosing instead to whine like sniveling babies. I called them on that tack, and suggested what they should have done.

Now it appears that eMusic is following the same path. Showing zero confidence in their own offering, they’ve shriveled up at mere rumors of a possible iTunes subscription model and, avoiding the rush, got in line immediately with cries of Antitrust. Pathetic.

EMusic, I’ve been a subscriber for over two years. I love your service and think it’s great. You’re whining here is ridiculous. David Pakman, CEO of eMusic had this to say:

“They’re basically saying, ‘Let’s give a piece of every iPod sale to the record labels in exchange for bundling in all the music you can eat with every iPod'” said Pakman. “That’s classic Sherman Antitrust Act behavior. It’s called tying, and it’s where a company with a monopoly position in one market uses that monopoly position unfairly to compete in another.”

Nonsense. First, all DRM music (by definition) is tied. That’s been the legal digital download landscape for years. In fact, your site is one of the bright, shining exceptions to this rule. Amazon has come on board as well (because the labels let them), and parts of iTunes (again, as the labels let them).

The company’s bundling of Internet Explorer with Windows “killed the browser market, it killed Netscape.

I’m no fan of Microsoft, but Netscape had as much to do with killing Netscape as Microsoft ever did. IE gradually overtook and exceeded the Netscape browser in terms of features, speed, and functionality. Microsoft corrupted that advantage with ActiveX, etc., but that came later, after Netscape delivered bloated releases of crap and lost their market, deservedly so.

My beef with Pakman’s comments is the same as I had with Mozilla and Safari. Why don’t you turn this occasion into a chance to sell your product? It’s a golden opportunity to get your service in front of people — since you’ll be asked — and ride the free publicity to make it clear what you offer that Apple doesn’t. How about something like this:

EMusic has been offering titles for an average of only 30 cents a song for years. And these are DRM-free, high-quality MP3s that can play anywhere.

Apple’s possible subscription service is clearly a move to better compete on price — after all, they’ve charged over three times what we do from the beginning. However, I feel when the details are revealed it will still be an unpalatable choice to many consumers.

A subscription model, by necessity, must carry very restrictive DRM. Even Apple’s already restricted FairPlay would be too “generous” to support such a model. Reports are that the new model would require streaming only, and certainly CD burning and transportability will be limited, if not banned outright.

Our music has always been, and will continue to be, DRM-free. You buy it, you own it, you do what you want with it. We have over three million titles, and growing. And since we do not charge Apple’s high prices for ownership, hundreds of thousands of consumers have seen the benefits to our approach.

When eMusic can’t say something like the above, and instead runs to hide behind some scare-mongering FUD about “antitrust”, it makes me think that they’ve already given up. I’m surprised they have this little faith in their service.

Fearing your opponent is never a good strategy. Respect them. Don’t ignore them. But running scared is not a smart move.

DRM-Free Music: NYT Gives Steve Jobs Credit, Win SuperSite Does Not.


Paul Thurrott attempts to set the record strait on DRM-free music. And in Paul’s world, the move to DRM-free tunes had nothing to do with Apple or Steve Jobs. You see, Paul’s been re-writing Microsoft history for so long he’s not above trying to re-write Apple’s as well.

So, on his completely unbiased (*cough, cough*) Super Site for Windows, Paul comments on a New York Times article that gives some credit to Apple and Jobs for the recent moves by the big labels to DRM-free music distribution. Paul, of course, cannot allow this, so he accuses the NYT of “pro-Apple history re-writing” and provides his corrections.

Before I even go any further, doesn’t this already make your ears perk up? I mean, why would the NYT be “pro-Apple”? And even if they were, there are so many good stories to publish about them why would they need to “re-write” their history? Further, why in the Hell would I think the NYT has it wrong, but a shill running a Windows Super Site would somehow get it right? OK, as all that sinks in let’s go on…

After mentioning that Jobs is the one who called on the industry to stop its DRM practices back in February, Paul steps in and gives us this:

“No it wasn’t. Anyone who believes that Jobs somehow led the charge in DRM-free music is living in a fantasy world.”

Mmm, yes. For the CEO of the company running the largest (by far) online music store to call for this halt was pretty trivial. Mind you, most people were accusing Apple of not wanting to ever get rid of DRM because of the alleged (and false) “lock-in” it provided Apple. So for Jobs to take this stance showed at once that those accusations were ridiculous, and those making them (and some still do) pretty much automatically disqualify themselves from intelligently discussing this topic.

“The outcry against DRM had been going on for years.”

Of course. And all those peons were critically listened to by the labels, making this sea change out of the goodness of their hearts. Hmmm, but isn’t there a huge outcry about all the lawsuits being filed by the labels as well? I wonder why we don’t see the labels stop that. Or what about the various pricing in Europe? The labels don’t seem to care there, either (though Apple is now calling them on it).

Why would the labels listen to the DRM outcry, as Paul is suggesting, but not other customer complaints? Could it be because the CEO of the largest online music store joined in the battle? Yes, I do believe so, even if Paul isn’t bright enough to see it.

Oh, and where was Microsoft’s CEO (or any other prominent media CEO) in all this, Paul? I can answer that. They were all in bed together with DRM schemes to strangle as much fair use rights out of the consumer as possible. Gates or Ballmer would never have called for the removal of DRM because they’ve been trying to sucker users into theirs (which was written solely to placate the content providers) for years.

“Jobs only jumped in when it became obvious which direction things were moving. This is a great example of Apple marketing winning out over reality.”

I wouldn’t believe this if I hadn’t read it, but Paul really is towing a new Redmond line that says the labels would have done this anyway. That’s a crock. Just as they haven’t stopped their other offensive practices against their own customers, they would never have even considered removing DRM had a major figure as important as Jobs called them on their BS.

Further, there’s plenty of proof that Jobs was against DRM long before his Thoughts on Music. The idea that he went where the wind was blowing is the real fantasy, Paul. I have no doubt you’re aware of this, but you increasing need to live in a fantasy world to avoid providing any credit to Apple, don’t you?

What I’m seeing here is nothing more than an Apple-bashing MS apologist and shill refusing to give any credit to Jobs/Apple even when it’s clearly due. In the process, he pretty much invalidates most of what he may have to say on this topic.

After refusing to give credit where it’s due, Paul (as is so often the case) simply plows forward. When the NYT article mentions that Apple insists on “selling all single tracks for 99 cents”, Paul is there to spew this garbage:

“Another bit of commonly-repeated fantasy. Contrary to Apple’s claims, tracks on iTunes are not consistently a single price (i.e. 99 cents). The company regularly offers sales and prices movies, especially, at a range of prices.”

Aside form when iTunes Plus was announced — tracks of which were initially $1.29 — I don’t know if I’ve ever seen a music track on iTunes for other than $0.99. And now, all tracks, including iTunes Plus, are at that price. Further, I’m not sure a “sale” necessarily qualifies calling the NYT quote “fantasy” anyway. Isn’t the definition of sale somehow selling for less than usual?

Besides, in Paul’s ridiculous quote he mentions movies — “especially” — at a range of prices. Thanks Paul, but the NYT was talking about music tracks. I hope you didn’t hurt your back moving those goalposts.

Ironically, Paul then goes on to quote what may be the only real myth in his entire post:

“But seriously, folks. Apple makes no money from iTunes anyway.”

It seems Apple pulls in around 30 cents a tune. From that, they need to support the infrastructure of the online store. I don’t think that’s 30 cents a song. The rest is profit. For a store that’s sold over 3 billion songs I think there’s some money in it for them, and I wouldn’t exactly call it insignificant. Yes, hardware sales are much, much more important, but it’s hard to believe there’s little or no net to Apple’s bottom line from music sales.

Finally, Paul closes the post as silly as it began:

“In fact, Apple would probably love to back off from the content distribution angle anyway: It’s a lot of work for no direct return at all.”

No, Apple wants to back off from DRM because it’s a resource-sucking hog for no gain to Apple, consumers, or anyone except content providers and companies like Microsoft who want to build their next monopoly upon it. If DRM were out of the way, there’d be nothing but basic ongoing maintenance and Apple could make even more money from the store.

Seriously, Paul, do you think Amazon is in this business to not make money? How is it they can make money from this (you do believe Amazon is making money, right?) and Apple cannot?

I hope your head doesn’t explode when you realize you can’t answer that question without a whole lot of history re-writing and/or fact juggling. Still, I’m sure you’ll try. And when you do, I’ll be here writing about it. See you then.

Sony Is Stupid, but Also Predictable and Still Shining Bright.


What a busy week for Sony!

First, I assumed that they were going to offer their wares DRM-free from Amazon but not iTunes, and I speculated on what the labels were up to.

Then, they threw me a curve by being incredibly stupid, which diverted my attention briefly.

Finally, today they’ve fallen right in line with my original prediction, and are offering their tunes on Amazon, but not iTunes. The article does not specify if Sony’s whole catalog is available or just a part of it.

Anyway, leave it to Sony to take time out from possibly colluding with three of the other big labels against iTunes to be really stupid for a couple of days.

In the Labels’ Darkest Hour, Sony Stupidity Shines Through.


Just a few days ago BusinessWeek ran a story that Sony was looking to sell DRM-free music, thereby joining the other “big” labels (Universal, Warner, and EMI) in offering at least a part of their catalog DRM-free. There was no mention of iTunes; speculation was that, like Universal and Warner, iTunes would be avoided and Amazon would be the online store of choice.

I wrote about Sony’s potential choice and wondered what the labels were up to. Silly me. I made the assumption that Sony would be selling through an online music store. I mean, where else would they sell digital music? Obviously it would be online, right?

But I forgot one key fact: This is Sony.

For all the dumb things Universal has done in their desire to get back to the glory days of huge music profits, I think Sony has been even dumber. Remember, these are the guys that invented the “ringle” — a ringtone/single on a physical CD — for sale in brick and mortar stores at $6 or more; the whole thing was laughable.

Well, history repeats itself. Sony is not (at least initially) using an online store for their DRM-free tunes. Rather, they will sell cards at retail locations that you use to download the album from a web site. It’s bad enough I have to go to a retail location to buy it, but I still have to use my computer to actually get the thing anyway. It’s the worst of both worlds! I guess this is what to expect from the makers of the ringle, CD rootkit and ATRAC.

And as bad as this looks, it’s even worse. As the Macworld article points out:

The move is far from the all-digital service offered by its rivals, though. To obtain the Sony-BMG tracks, would-be listeners will first have to go to a retail store to buy a Platinum MusicPass, a card containing a secret code, for a suggested retail price of $12.99. Once they have scratched off the card’s covering to expose the code, they will be able to download one of just 37 albums available through the service, including Britney Spears’ “Blackout” and Barry Manilow’s “The Greatest Songs of the Seventies.”

Twelve. Ninety. Nine. Is Sony insane? Have they not noticed that the going price for a full digital album is $9.99 (and even that’s too high)? They want me to pay $3 more and go to Target for the privilege! Seriously, Sony, how dumb can you be?

Oh, and only 37 albums? With ringles they planned up to 50 titles, but now can’t do more than 37 lousy albums? These guys are dumber than Universal and, believe me, that’s really saying something.

Of all the ridiculous ideas that have come out of the labels the last couple of years, this is the ridiculoust! (Yes, I just invented “ridiculoust”. I think it applies.)

Warner Hates DRM Just A Little Less Than iTunes.


So the net is abuzz with the story that Warner Music will sell DRM-free music through Amazon.

Numerous headlines call it a coup for Amazon, saying they beat Apple to the punch. And many are proclaiming it as a change of heart for Warner. It’s neither.

I don’t understand why it’s hard for some people to see that the only motive behind all this DRM-free love from Warner (and Universal before them) is motivated by the labels’ hatred for iTunes, and their attempts to break its popularity in the online music market. Amazon did nothing special to get Warner’s music, it was practically given to them by Warner.

Of the four major labels, only EMI makes their music DRM-free on iTunes as well as Amazon. And they did so long ago, without having to first make fools of themselves in a few more failed efforts. I would say that they have seen the light and shown a change of heart, but Universal and Warner? No.Consider the following:

  • It’s still not clear whether Universal has opened up their entire catalog DRM-free. That was certainly not the case when they initially made music available for Wal-Mart and Amazon.
  • Universal has also made their music available “free” (though not DRM-free) via other means such as Spiral Frog (which is bleeding money) and the Total Music initiative. They dole parts of their catalog out free or DRM-free to everyone but iTunes.
  • Warner is now making DRM-free music available for Amazon, but if it’s really a change of heart why do they care where the consumer gets the music? Why not make the obvious choice of also using the world’s largest online music store? Same goes for Universal.
  • Does anyone think Apple wouldn’t offer Universal or Warner music DRM-free if they could? Please. The labels are withholding it from them (either outright, or via unreasonable terms) in an attempt to gain some alleged advantage. This advantage is supposed to be pricing, and yet Amazon sells for the same (or maybe even less) than iTunes!

There is no change of heart, and the labels’ heads are still securely positions up their rectums. Any move they make to break iTunes, which is raking in money for the labels, proves that.

It concerns me that the labels hurt their own profits and customers’ interests in an attempt to get back at iTunes. It’s stupid, deceitful, and wrong-headed thinking. Why aren’t the stockholders enraged? I’ve come to expect this from the labels, but when I see how some of the headlines spin this latest announcement it’s clear some people aren’t paying attention.

Bottom line is this: If the music is truly without restriction, why do Universal and Warner care where you get it? It’d by like taking their CDs (also DRM-free) and selling them at Best Buy and Target but not Wal-Mart! It would be insanity to not sell your DRM-free CDs through the largest retailer, and yet when it comes to digital music this is just what Universal and Warner are doing. It’s almost impossible to construct a scenario where the reason behind this is anything other than taking misguided shots at iTunes in the face of ignoring your own potential sales, profits, and customers. Why they’re not called on this is beyond me.

Total Disaster: Universal’s Never-Ending War Against Apple.


BusinessWeek published a story about yet another move Universal is taking against Apple. Before we get to their latest, let’s review the recent shots Universal has fired:

  • Pulled out of negotiations for iTunes contract extension.
  • Supplied DRM-free tracks to Wal-Mart’s PC-only music store as a “test”. Not for Mac.
  • Threw a boatload of DRM-free titles at Amazon in support of their AmazonMP3 store.
  • The Amazon and Wal-Mart tracks were not offered DRM-free to Apple’s iTunes store.
  • Teamed with SpiralFrog to offer “free” subscription music. You know, the exploding media that renders itself inoperable if you don’t visit the site often enough. Not for Mac. Not for iPod.

I wrote about the last item here, and the Amazon deal here. It’s amazing Universal changed their DRM views (for now) on selected titles — still a small percentage of their catalog — to spite Apple and hinder an online store that’s working, is popular, and making them lots of money! How greedy/stupid/arrogant do you have to be to potentially harm your sales in the belief that you’ll get back to the “good old days” of controlling all music distribution with an iron fist? And how pathetic do you have to be to do this while complaining about the very sales you’re hindering?

OK, enough review, let’s see what BusinessWeek says is next up Universal’s sleeve:

“Now, [Universal CEO Doug] Morris is going on the offensive. The world’s most powerful music executive aims to join forces with other record companies to launch an industry-owned subscription service. BusinessWeek has learned that Morris has already enlisted Sony BMG Music Entertainment as a potential partner and is talking to Warner Music Group… The service… will be called Total Music.”

Total Music? Total Disaster is more like it.

I can see why Sony would buy into this. After all, these are the guys who invented the CD root-kit and ATRAC, both disasters. They also spawned the ridiculous “ringle”, which will be a disaster when they bring it to market (I blasted it here).

As for Time Warner, they were the relatively “quiet” label until a week ago when they formally announced they can be as stupid as Universal. They’ve shown nothing in the way of original thinking and I’m sure would follow Universal down one of its many meandering paths.

“This isn’t only about Jobs; Morris badly needs to boost his business, and Apple is the one to beat.”

Dear Morris, APPLE IS SELLING YOUR PRODUCT! They’ve sold over three billion tracks, and statistically most of those were yours. When Apple sells one of your titles, you make money. And you spent zip for that profit; all you did was supply a source file. Do you understand any of this?

You should be helping Apple and iTunes, not wasting profits on building something inferior. You should attempt to leverage Apple’s success, not treat it as an enemy to turn your back on. That makes zero sense. Do you really think another subscription model and/or jacking up prices are your only options?

“And let’s not forget that existing subscription services have signed up only a few million people, vs. hundreds of millions of iTunes software downloads.”

The music labels have already forgotten this. This is why most of their initiatives revolve around very restrictive DRM and a subscription system. They keep chasing that dream.

“While the details are in flux, insiders say Morris & Co. have an intriguing business model: get hardware makers or cell carriers to absorb the cost of a roughly $5-per-month subscription fee so consumers get a device with all-you-can-eat music that’s essentially free.”

Oh, gee, another subscription service with another twist on “free”. While the SpiralFrog service is funded via ads, this new initiative will be funded by the consumer, having to pay for it in the initial price of the device. How the heck does this make it free?

“And though Morris hasn’t publicly blasted Jobs, his boss at Universal parent Vivendi is not nearly so hesitant. The split with record labels–Apple takes 29 cents of the 99 cents–“is indecent,” Vivendi CEO Jean-Bernard Levy told reporters in September. “Our contracts give too good a share to Apple.””

Dear Levy, you don’t create the music, you don’t promote it, you don’t host it, you don’t distribute it, you don’t support it, and you built no infrastructure for it. In essence, you spend nothing yet rake in 70% of the price. It’s indecent alright, but not in the way your twisted view sees it.

Apple gets 30%, and from that must fund the infrastructure to make this happen. What’s that leave them? Half? Not bad, but nowhere near 70. Are you begrudging them any profit at all? The service they provide isn’t worth ~15% to you? You get nearly five times their profit, do none of the work, and it’s not enough? You’re even more out of touch than Morris. The truth is, you are indecent.

“With the Total Music service, Morris and his allies are trying to hit reset on how digital music is consumed. In essence, Morris & Co. are telling consumers that music is a utility to which they are entitled, like water or gas.”

Aren’t water and gas more like, you know, necessities? And don’t you usually have just one source? It’s not like I went online, shopped around, and then picked the best gas and water companies to service my home. It’s a dumb analogy, and shows that BusinessWeek should maybe mind another business.

To me, this is just another BS maneuver by the labels in a bid to get people to rent music. They want what the video guys have, but the difference in the two is pretty fundamental. People listen to their favorite music over and over. While there may be a few movies or TV shows watched numerous times, the majority are watched once or twice. This is why DVRs or renting flicks work so well. Video and music are different animals, with different experiences and totally different expectations.

“The big question is whether the makers of music players and phones can charge enough to cover the cost of baking in the subscription. Under one scenario industry insiders figure the cost per player would amount to about $90.”

So, right now an incredible music player with 4GB memory and video/podcast/game capability sells for $149. But they’ll sell an inferior one (no one’s made one better) with a price 60% higher, and justify it by saying the user can load it with DRM-infested music for “free”? Wow. Can you show me the dictionary being used to define “free”?

Oh, and let’s talk about the DRM they’ll be using. Can the user put this music on an unlimited number of mobile players? Of course not. Can they play it on up to five PCs? Don’t bet on it. Can they effortlessly burn it on CD? Hell no. Remember, folks, this DRM won’t be FairPlay. It’s going to be a subscription DRM. You do not own these songs; they must be locked tightly to the device or the subscription model is useless.

“Of course, Morris still needs Jobs. It’s noteworthy that Universal has not pulled its music from iTunes–Morris simply can’t afford to do that.”

But apparently he can afford to thumb his nose at Apple and their iTunes customers. I’d love to hear why Universal didn’t cut Apple the same deal they cut Amazon for DRM-free tracks. There’s little reason except a certain disdain for iTunes and those who use it. The labels have decided that iPod consumers (most of them are pirates, remember?) and their overwhelmingly favorite online music store must be the cause of their declining sales.

Personally, I think the cause of the music labels failure is a lot more simple. It’s the morons in charge. I’ve asked this before but it bears repeating: Where are the labels’ stockholders? Why aren’t they calling for these guys’ heads?

Real iTunes Competition, But Why Are The Labels Being So Nice?


Amazon opened their MP3 store today, and it’s clear iTunes has legitimate competition since Amazon avoids the pitfalls that made other music sites a joke. However, through it all some curious questions arise, which I’ll get to below. Meanwhile, here’s why this new site is a valid alternative to iTunes:

This is a buy-to-own store, not a music-rental store. And there is no DRM. Enough said.

This is not some entity you’ve never heard of. This is Amazon. Even though the system is beta, I tend to trust it more than a new company formed by groups looking to make a quick buck or fit a marketing plan. Further, even as beta I expect Amazon to have fewer glitches than a new company. After all, they’ve been doing this online sale thing for a long time (it remains to be seen how well they are at the download process, however).

Works fine on PCs and Macs. While not as slick as iTunes’, the interface is pretty easy to navigate and will be familiar to anyone who’s used Amazon. I bookmarked the site, and occasionally used that to get “home” because an obvious way back was not available. Also, on a couple of occasions I found myself in the CD section of Amazon when that’s not what I wanted. Overall, though, it’s a pretty good interface for a beta.

Since there’s no DRM, all files are playable on any MP3 device (your computer, iPod, CD, iPod, car player, iPod, Sansa, iPod, Zune, iPod, etc.).

Price is quite good. Lots of popular albums for $8.99, a dollar less than iTunes. They advertise albums for under $4.99, $5.99, etc., but that’s misleading since they’re EPs. You’re still paying ~90 cents a song. The iTunes store has lower prices on such “albums” as well. Amazon singles are 99 cents, better than iTunes because their DRM-free tracks are $1.29.

All tracks are 256K MP3. The free track I got was 256K VBR LAME encoded, which is about as good as MP3 gets. However, the album I bought was 256K CBR with no information about the encoder. Clearly there’s some variance, but at 256K they should all be very good quality.

Since this is DRM-free music, an initial offering of two million tracks is actually pretty good. It pales next to iTunes’ six million, but that’s not all DRM-free. Amazon’s site really shines a light on what is not DRM-free. For example, where’s Sony? And where is most of Universal’s catalog?

Clearly, this is not yet another “me too” site that will close with a whimper in 18 months. For now, it’s a legitimate place for me to browse when I want to buy an album, though by no means a slam dunk.
But something doesn’t smell right…

Amazon’s DRM-free prices are in line or even less than iTunes’ DRM prices. Think about that for a minute. The labels hate iTunes pricing — it’s what they constantly bitch about — yet here is Amazon with those same iTunes prices (or less!) for tracks having a distinct advantage.

EMI wanted more money from Apple for singles with no DRM, but seem perfectly satisfied with Amazon’s 99 cent price for the same thing. Why? Further, Universal has repeatedly said they’d never remove DRM, yet they tossed a few hundred thousand DRM-less tracks to Amazon at only 99 cents. What gives? Why the special treatment?

In my opinion this is just a push for Amazon to get customers while the labels hope to break iTunes’ grip on the digital music world. If the store gets popular, expect the labels to raise prices and, unlike Apple, expect Amazon to have little issue with this. The labels might also rollout more tracks, but with DRM. We know Amazon’s video site is in bed with content providers (most recently NBC); they clearly have no issue with DRM. I think if Amazon were seen as a threat to balk at any of this they wouldn’t be getting this preferential treatment to begin with.

So what’s going on, is this all just to spite Apple? That makes no sense because the labels gain nothing from it; all they‘d have done is create another iTunes store, or worse. Have they changed their mind on DRM? Then offer all of Universal’s tracks and, for that matter, the other labels’ as well. Have they decided iTunes pricing isn’t so bad after all? Then offer Apple the same terms. Do they just want to build a popular store with a partner who won’t argue over pricing and DRM restrictions? DING DING DING DING DING!! We have a winner!

Of course, I could be wrong, but something doesn’t smell right.

Nyuk Nyuk: The Three Stooges And DRM-Free Music Online.

“What are you, a wise guy?”

What would happen if the three stooges tried to take on Apple’s iTunes Store? Well, now we know, because its happened.

First we have Universal Music. Wanting desperately to sell DRM (preferably Microsoft’s) music, and to jack up prices for newer and more popular titles, they are frustrated by Apple at every turn. So in their own way of trying to poke their fingers in iTunes users’ eyes, they’re offering DRM-free music for a limited time. They claim they’ll gauge reaction to determine if they should continue the practice. Sounds good, right? So what’s the problem? The problem is it’s all a bunch of hooey:

  • The tracks are not be available on iTunes. Aside from the obvious fact that you can’t gauge market reaction by not offering it on the world’s largest and most popular (by far) online music store, it makes Universal’s real motives pretty transparent. Universal should have been more low key but, frankly, they’re not bright enough.
  • They teamed with Wal-Mart. Why them? Well, aside from the fact that there aren’t many online music sellers left, this second stooge is perfect because, like Universal, they haven’t a clue how to step into online media sales and distribution. They’re made for each other. In my opinion Wal-Mart already started off wrong because, like Amazon, they’ve chosen the wrong file format.
  • The new service doesn’t work on Apple’s Mac. I can just hear the Universal execs now: “We’re already not making it available on the store used by most Mac users. Still, in case that’s too subtle about how much we despise Apple — though they pour millions into our coffers for doing nothing but supplying source files — let’s also utilize a web site they can’t use. Ha ha! Oh, but will they get wise to this not really being an experiment? Naaaah, we’re too clever for them.”
  • Looks like only their older catalog of music is available. What, you though you’d be able to get all the Universal music on Wal-Mart DRM-free that you can get on iTunes? What part of “this is not really an experiment” are you not getting? Universal has no intention of selling current titles for .94. They abhor Steve Jobs for not raising the .99 price, they’re sure not dropping it a nickel! They’re throwing their back catalog at it and hoping to get purchases so people will at least think about buying online music somewhere other than iTunes.

Fine, but what about Microsoft? How are they the third stooge? They’re not mentioned in the press releases and articles on this. In fact, the new tracks sell alongside their own WMA music. Why am I throwing them in the mix? Simple:

  • Wal-Mart and Microsoft have been in bed since the beginning. It’s no coincidence Wal-Mart’s site only works in Internet Explorer! Not even Firefox on the PC works! This isn’t incompetence, and it’s not because Wal-Mart’s developers just wanna code like it’s 1999, it’s deliberate. Further, Wal-Mart not only uses Microsoft’s DRM, they also use their WMA file format. These guys are tighter than Larry and Curly.
  • Microsoft is tight with Universal, too, even agreeing to a “Universal tax” on the Zune. Microsoft slips a dollar to Universal for every Zune sold. Sure, this has only added 47 dollars to Universal’s bottom line, but these two behemoths share similar views of online distribution, which is to lock it down as much as possible and charge you again for what you already own. Even worse, the agreement gave Universal a swollen head, making them think they could push other companies around. Never mind that Microsoft is nothing in the media business, and was simply desperate to get Zune sales (though it didn’t work).
  • Microsoft is for anything that gets people to Wal-Mart’s music site. After all, when visitors find out they can’t get current Universal titles DRM-free, perhaps the “bait and switch” kicks in and they’ll buy the WMA version.
  • Microsoft wants Universal to succeed in this ruse as much as Universal and Wal-Mart do. If Universal “wins,” and gains clout, they can keep DRM at least for their popular titles, and whose DRM do you think they’ll choose? Universal wants to tell Apple to take a hike; Microsoft would love that, they have DRM for sale.

So maybe you’re thinking, let’s say you’re right, Tom. So what? Why should that prevent me from buying the music DRM-free as long as its available and a lower price than iTunes? If it’s not available, I won’t buy the DRM version (pointless if I have an iPod anyway), so what’s the harm?

The answer is, maybe none. But I’m not going to do it. I’m not a boycott person, but this move seems so transparent and disingenuous, I’m not going there. But if you snapped up lots of Universal’s back catalog DRM-free, I couldn’t say I’d blame you.

If Wal-Mart sells a lot, and manages to become a player in this game, Universal will have the leverage to force a price hike on popular stuff and still keep it DRM’ed. This is their primary goal, and one Apple will not help them achieve. If Wal-Mart sells very little, Universal will claim it as proof that people don’t care about DRM. Either way, I don’t see a DRM-free current Universal catalog anytime soon.

Personally, I don’t think Wal-Mart will sell much. It’s more than just money, the iTunes store is very slick and well-integrated. Rather, I see iTunes users raising their collective hand up sideways in front of their nose to keep Universal’s fingers out of their eyes. In other words, we’ll moidelize ’em!