Is it the end of DRM as we know it?

Amazon.com's announcement of its intentions to sell music online free of DRM certainly made a splash in the press last week.  12,000 Labels (who KNEW there were 12,000 labels!) reportedly are offering their content for sale, excluding the Big 3 - Universal, Sony/BMG and Warner.  EMI is on board.  The deal is similar to the deal EMI cut with Apple - $0.99 for songs that include DRM, $1.29 for songs without DRM and in a larger file format that is reported to offer higher sound quality.  So this is good for consumers as it clears up the issue of interoperability of content on any media playback device, right? Perhaps.  If the Big 3 are not on board consumers still do not have access to most of the music of major artists.  The Labels have been struggling with the issue of music downloads for some time, trying to determine how best to offer downloads that preserve their business model.  One company I worked with developed what I thought was a novel idea to resolve the issue of interoperability.  The concept, in very layman's terms, was to attach the content license to the CONSUMER, not the device.  This would allow the consumer to play the music on any device they own but prohibit the illegal redistribution of the music.  Functionality was being developed that would enable the friends of the owner of a piece of content to "sample" a song and, if they liked it, buy it from the friend (using the interoperability service to facilitate the transaction) under the same rules as the original purchase.  Viral Marketing.  Legal Super Distribution.  What's not to like?  Any marketer will tell you how the opinions of peers have a big impact in the purchase decisions of others. 

This service requires the user to register their audio playback devices with the behind the scenes platform, which can easily be done since each portable device manufactured has a unique identification code.  When the consumer purchases music online or buys a CD the song or CD must first be registered with the service prior to being downloaded to a playback device.  The consumer is then issued a digital "license" to the content.  When the consumer wishes to download the music to one of their playback devices, the system checks the consumer's online license library to insure ownership and then downloads the song to the desired, authorized, portable device, applying the correct DRM, CODEC and security features to the content as prescribed by the Label.  This is similar to the concept of driving a car, somewhat.  You have to obtain a license to drive a car, but it does not limit you to the type of car you can drive (within car class, of course - you aren't licensed to drive a semi or a motorcycle).  One can drive their car to the airport and then rent a car at their destination without having to have a separate driver's license.  They can then return home, drive their car from the airport to their home and, perhaps, drive their spouses car to run errands.  No problem.  Same concept.  You have a license to the particular piece of content, and should be able to play it in any car you drive.  In this case, on any device you own.

The company who developed this technology platform is Ardtully Technologies, Inc (www.ardtully.com).  They have worked closely with the CORAL Consortium and it's members (including the Big 4 Music Labels, the MPAA, RIAA, and most of the major Movie Studios and CE manufacturers) on interoperability issues and have designed the platform with the CORAL standards in mind.  I doubt that it will ever see the light of day as the Labels, according to my sources, have abandoned discussion of platforms of this nature and are engaged in discussions of whether or not to go DRM naked for digital downloads. 

Fundamentally, its all about the business model.  How do the labels maintain a core revenue source and minimize the risk of illegal super distribution?  They have leverage over their artists if they own the copyright to the artist's work.  But what's to stop artists in the future, once their agreements with the Labels expire, from offering their music for free online and hiring their own PR agency to promote their work and to establish tour dates for concerts.  Some artists are already doing this.  The business model is changing for the artist as well, potentially in their favor.

So, is it the end of DRM as we know it?  Not in the near term.  But in time all indications are it will be.  And I feel fine.