Yesterday, C|Net News ran a story I initially didn't pay much attention to about Microsoft potentially jumping into a subscription music service (Microsoft Planning Music Subscription Service). Yawn. Who isn't?
So, I didn't even read the story. Luckily for me, Good Morning Silicon Valley did (Psst, Kid, You Really Gotta Try Some of This WMA. First Taste is Free.).
News.com reports that Microsoft, long envious of Apple's iTunes storefront and its grip on the digital music market, is planning an iTunes exchange, a service that would enable us to download a Microsoft-formatted version of any song we've purchased from the iTunes Store.
Well, that would be quite a trick. This is where the DRM really hits the road.
Look at it from Microsoft's point of view. Every song you purchase from iTunes with Apple's proprietary, DMCA-protected DRM is one more bit of lock-in to Apple. When you've got a hundred or two hundred or more of your favorite (let's face it, you buy your favorites first) songs in iTunes format, you've got some significant lock-in in the form of very high switching costs. Just the way Steve Jobs likes it.
And that lock-in is growing at a rate of millions of songs every month.
What is a would-be player in the digital music distribution world to do? One option, of course, is to do what Microsoft apparently plans to do, which is pay an unknown sum (but likely rather substantial ) to let people download (again) music they've already purchased from Apple. There is the mechanical license, of course. And you don't think the artists and recording companies are going to let the music publishing companies make money and they don't, do you? This is going to be expensive. Microsoft can probably afford it, now, before digital downloading really takes off. Can you say "barrier to entry"? I knew you could.
Of course, it remains to be seen whether Apple will make it easy for Microsoft to pull such a switch or not. I imagine that, if they did, they would
expect require Microsoft to do the same. Although Apple probably will cooperate with Microsoft as much as they did with Real (Apple Gets Real Serious About Harmony).
In any case, how many times do you think this game of downloading again, and again, and again can go on? We're going to see some consolidation pretty darn quick. At least for now, as the players try to capture market share at all costs, consumers will probably be okay. If one of the music services goes out of business, their customers will almost certainly be picked up with a generous transfer by one of the other services (most likely Microsoft, since they'll most likely be the ones behind the DRM).
One of the scary things is, of course, that we will no longer have the current oligopoly of the music industry, but a duopoly of DRM camps. And once you've settled into lock-in with one DRM provider for music, are you going to choose another for movies, or television? Ultimately, we are probably looking at a duopoly for all mass-produced multimedia content.
And this is supposed to be good for artists, right?