Steve Jobs says Apple would embrace copy-protection-free music "in a heartbeat". Is this the end of digital rights-management?

This article appears in the May 07 issue of PC Advisor, available now in all good newsagents.

Anyone who owns an iPod or has used iTunes will have been frustrated by what's become a hot topic over the past couple of months. DRM (digital rights-management) is the term used to describe various technologies that stop you moving your purchased tracks between devices, and from copying songs when you please.

It's used by companies such as Apple to protect music and video publishers from filesharing sites and users with no respect for copyright. But it's a major nuisance for those who want to legitimately move music from their iPod to their Sony MP3 player, or from their home PC to their work computer and then to their laptop.

DRM has been around for years. The reason it's back in the spotlight is that Apple boss Steve Jobs suggested in February that it could be time for his company and its music partners to free our music of its DRM burden. He said Apple would drop DRM technology from the music sold through its iTunes store if major record companies would allow such a move. And that's set the stage for an industry-wide showdown, with some music labels fiercely defending the technology and others suggesting the time has come to kill it off.

So, will we be able to do what we want with our music?

Apple bashing

Jobs' comments come at a key time for Apple. European consumers and lobby groups are pressuring Apple to loosen the ties between the iPod and music sold on iTunes. Currently, songs sold at the iTunes store can play only on iTunes and Apple's iTunes.

In an open letter, Jobs said DRM was originally a strict requirement of the major record labels when they were thrashing out a deal to allow Apple sell their music online. Apple's FairPlay DRM lets users play protected songs on up to five PCs and an unlimited number of iPods, while burning playlists is limited to seven times.

"Obtaining such rights from the music companies was unprecedented at the time and even today is unmatched by most other digital music services," Jobs wrote.

"However, a key provision of our agreements with the music companies is that if our DRM system is compromised and their music becomes playable on unauthorised devices, we have only a small number of weeks to fix the problem or they can withdraw their entire catalogue."

The Apple chief executive called DRM-free music "clearly the best alternative for consumers" and one Apple "would embrace in a heartbeat". But that decision lies with the four largest music companies – Universal, Sony BMG, Warner and EMI. Right now, they're adamant that DRM technology has to be included with downloaded music.

"Perhaps those unhappy with the current situation should redirect their energies towards persuading the music companies to sell their music DRM-free," said Jobs, noting that two of the four largest music companies have owners located in Europe, where much of the clamour over DRM has taken place. Another, Sony, is half owned by German-based Bertelsmann.

"Convincing them to license their music DRM-free will create a truly interoperable music marketplace," Jobs said. "Apple will embrace this wholeheartedly."

Pointless exercise

Jobs notes that it's difficult for a DRM system to work since music companies sell 10 times the amount of songs sold online via CDs with no DRM. Users can rip those CDs and upload files to the internet for others to download.

"So if the music companies are selling over 90 percent of their music DRM-free, what benefits do they get from selling the remaining small percentage of their music encumbered with a DRM system? There appear to be none," Jobs said.

Jobs disputed the notion that DRM systems tie users to a particular music player or store. According to Jobs, Apple has sold 90 million iPods and 2 billion songs – or 22 songs for every iPod ever sold. By Jobs' maths, that accounts for less than 3 percent of the music stored on an iPod holding 1,000 songs.

"It's hard to believe that just 3 percent of the music on the average iPod is enough to lock users into buying only iPods in the future," Jobs said.

But persuading music labels to permit Apple to sell DRM-free music is no easy task, and some industry bigwigs have already rejected the suggestion in no uncertain terms. Warner Music chief executive Edgar Bronfman said Jobs' suggestion was "completely without merit".

"We advocate the continued use of DRM," said Bronfman. "The notion that music does not deserve the same protection as software, film, video games or other intellectual property, simply because there is an unprotected legacy product in the physical world, is completely without logic or merit."

Bronfman pointed out that DRM is not the only thing preventing tracks from being moved around between devices, however. There are two factors: copy-protection, which is covered by DRM technology, and interoperability, which would allow DRM-protected tracks to be moved between devices made by different portable media player manufacturers. Warner backs interoperability, but is fiercely against removing DRM.

DRM-free music

Not all music industry executives feel the same. EMI, for example, has already released DRM-free MP3s through Yahoo's online service, offering several tracks by Nora Jones and Relient K in December.

"The results and the feedback have been very positive," said EMI spokesman Adam Grossberg. "We believe the lack of interoperability between platforms is becoming an increasing concern for consumers, and EMI has been engaging with its partners to find a solution."

While positive feedback doesn't necessarily mean the music industry will embrace DRM-free online sales, one iTunes competitor, Real, which operates the Rhapsody service in the US, believes DRM-free music will happen. "We think it's just a matter of time," said Dan Sheeran, Real senior vice president of music. "It's largely a matter of everyone being comfortable with it."

Real is no stranger to the concept of DRM-free music. The company says it's been working with music companies for several years, encouraging them to drop the restrictions from digital downloads. Rob Glaser, chairman and chief executive, has been outspoken on the issue.

"[In January] at the MIDEM International music conference, we called on the major labels to drop DRM for digital-music purchases," said Glaser. "Doing so would be the right thing for consumers and would be good for everyone in the industry. It's great to see other industry leaders support this message."

Real executives agreed with Jobs that DRM does little to stop the theft of music. "The committed pirate is still going to get what they want," Sheeran said.

"There is always going to be piracy. The main question is will it be the majority or minority of the activity?"

DRM supporters contend that dropping the technology would lead to more piracy and illegal filesharing. However, RealNetworks believes the opposite could be true if the industry takes the time to educate the consumer and make the digital experience better.

"We believe that piracy has continued because DRM has made the experience worse than if you buy a CD," Sheeran said. "You can't play it on other devices. Most consumers don't want to be pirates, but until we make it a better experience, a lot of consumers will continue on the other path. Ironically, [dropping DRM] could lead to less piracy."

Working together

The RIAA (Recording Industry Association of America), however, believes that the answer lies not in eliminating DRM but in making existing technologies work together.

"We all want to see this marketplace work and for fans to enjoy the music they have lawfully bought on various devices or services," the trade group said. "The issue is how. One way to achieve it was outlined by Steve Jobs in his post – for Apple to license its DRM to other technology companies. We think that's a great solution."

Jobs did mention the possibility of Apple licensing FairPlay to competitors in his letter, only to dismiss the option out of hand due to his concern that such a move would lead to leaks of Apple's proprietary technology.

"Such leaks can rapidly result in software programs available as free downloads on the internet, which will disable the DRM-protection so that formerly protected songs can be played on unauthorised players," Jobs wrote.

The RIAA dismissed such concerns in its statement: "We have no doubt that a technology company as sophisticated and smart as Apple could work with the music community to make [interoperability] happen."

Apple is in a key position here. Music labels were notoriously slow in embracing music downloads. It took the threat of filesharing networks that allowed people to download tracks for free in the late 90s to convince them that the market was ready to buy music online. And Apple's iTunes played a major part in helping the concept reach the public consciousness.

Whether it's through DRM-free music or an interoperable copy-protection technology that will allow you to play the same tracks on iPods, Sony Walkmans or Creative Zens, the industry is slowly warming to the idea of music with fewer restrictions. But until everyone agrees on how to do it, the dominance of the iPod and iTunes will mean that Apple will continue to feel the brunt of most people's anti-DRM sentiments.

Blu-ray disc and hd-dvd copy-protection hacked

One thing's for sure, release content on to the internet and the hacker community will try to defeat its copy protection. And music isn't the only type of content targeted.

A hacker claims to have already discovered a cryptographic key that can be used to circumvent the DRM on HD-DVD and Blu-ray Disc movies.

The key, published on the discussion forum, is a further step toward undermining the next-generation AACS (Advanced Access Content System) encryption system used to copy-protect high-definition media.

The hacker, going under the name of Arnezami, said he discovered the key by examining what was happening in his computer's memory while it processed an HD-DVD video.

A spokeswoman for the group that sets the AACS specification, called the AACS Licensing Administrator, said Arnezami's claims were being investigated but declined to give further comment.

Introduced in April 2005, AACS is supported by media and technology companies such as Microsoft, Panasonic, Sony, Toshiba, Walt Disney and Warner Bros.

The encryption system is designed to be more robust than the CSS (content scrambling system) encryption scheme used by DVDs, which was completely cracked in late 1999.