Today, Apple, Inc announced that by March 2009, all 10 million songs sold through their iTunes (Gallop Forum) Music Store will be free from all Digital Rights Management (DRM) restrictions.  This will enable consumers to enjoy content they’ve purchased on all devices throughout their homes, vehicles, workplaces, and handheld devices without being limited by Apple or the supplying music studios.

As we’ve covered before, DRM can severely curtail consumers’ use of media throughout their lives.  In addition, it can hold consumers hostage to their media providers - when the provider goes out of business, or decides that maintaining DRM access is no longer a viable business service, the consumer is left without access to their music, movies, or other content.

UPDATE (9:05p EST): According to the Apple press release on these these changes, previously-purchased DRM-laden files can be “upgraded” to the newer non-DRM format for 30 cents per song, or 30% of the cost of an album file.  While that could add up for users with large music libraries, the value of removing Apple’s shackles on the content that was purchased could certainly outweigh the financial cost.

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The Digital Rights Management (DRM) controversy has an impact on all sides of the software and entertainment industries.  Our article on the topic earlier this month mostly focused on the music, but it affects movies and video games as well.  Just ask gaming giant Electronic Arts (NASDAQ:ERTS), who received a lot of bad press since the launch of its much anticipated game Spore, due to its DRM implementation.  The problem was that you could only install the game three times.  EA has since then upped that limit to five and argued publicly that their DRM policy only affects 0.2% of their customers.

It may be true that vast majority of users don’t need to install the game five times and don’t really care about the footprint that the DRM software leaves on their computer.  However, the minority that does care is quite vocal: the Amazon.com review page for the game lists an average rating of 1.5/5 stars, with an overwhelming majority of those reviews being only 1 star.  This is directly caused by the DRM issue as the game has otherwise received good reviews.  Now this may only be the doing of 0.2% of users, but 100% of the customers browsing Amazon will see this rating.

EA is trying to do as much damage control as they can and is trying to work toward more long-term solutions, such as allowing players to de-authenticate installations (much like what iTunes has done for years). However, industry analysts are saying that much of the damage has already been done.

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As we’ve previously discussed, the boundaries between types of content delivery have been slowly eroding for a while.  More than likely, hard media (CD, DVD, BluRay) will gradually become less prevalent while digital media (downloadable and/or streaming content) will become the norm.  It’s already very easy to buy or rent movies and TV shows digitally through services like Amazon (Gallop Forum) Video-on-Demand or Netflix (Gallop Forum).  The difficulty is that often you can only play your media on a few devices - sometimes just one!  For example, you may have bought the latest season of The Office from Amazon, but if you want to watch an episode on your Zune while working out, it may be a complicated endeavor due to the limitations of the notoriously pesky DRM implementations out there.

The industry is keenly aware of this fact and last week officially formed a group to discover a solution to this problem that would allow the content you’ve purchased to be viewable anywhere. Most of the big names among movie studios and media retailers are joining the effort, with the notable exception of Apple, Inc, which will no doubt continue developing their current solution to this problem: just buy all Apple products and you can watch your iTunes (Gallop Forum) purchases anywhere! (This solution has been working great for me, by the way.)

Regardless of whether or not this initiative succeeds (there are no details about it yet except for the fact that the group has been formed), this is definitely a step in the right direction and if anything shows that the industry is aware of this limitation and is actively trying to overcome it - and eventually will.

©2008-2009, Gallop Services, Inc. All rights reserved.

Today, we generally shop for music in very different ways than we did 20 years ago.  Fewer consumers than ever go to “brick-and-mortar” stores to listen to music that must be purchased on hard media (tapes, CDs, DVDs).  A large portion of the consumer base now goes to Apple Inc’s iTunes (Gallop Forum) or Napster (Gallop Forum) to buy their favorite songs and albums in digital format.

The already popular social networking site MySpace has just launched its own digital music service, which lets you listen to songs for “free” (meaning you’ll be bombarded with ads) or for purchase.  This service operates through a partnership with Amazon, which is itself no stranger to the industry, as they sell music in both hard media and DRM-free digital download formats.

Backed by all the major labels, MySpace is hoping to pick up some of the market that is right now largely dominated by Apple. Given its already large user base and its reputation for helping upcoming artists gain popularity, it seems very well placed to do so.

Regardless of whether or not MySpace is successful in gaining significant market share in the digital music space, this is a nice step in the direction of media being universally accessible in the cloud, ever more cheaply.

©2008-2009, Gallop Services, Inc. All rights reserved.