A nice portrait juxtaposing trends in mainstream digital content markets:
1) Amazon to Sell Warner Music Minus Copy Protection
2) Wal-Mart cancels movie download service
In the music biz, Warner joins EMI and Universal in offering DRM-free music downloads, making SonyBMG the last hold-out among the major recording labels. Hard to imagine they wont break before the end of 2008.
On the video side, yet another DRM-laden online video business dies a quiet death. Why won't people use them? Well, for one, their download speeds tend to be somewhat slow and two, according to the article above:
Videos purchased on Walmart.com can be played using the Microsoft
Windows Media Player or the Wal-Mart Video Download Manager, but cannot
be transferred to a computer other than the one used to download them,
according to the site.
Once again, digital media retailers mistakenly believe consumers will adopt new technologies that offer less flexibility and fewer options than current ones. If I buy a DVD, I own it and can play it on most any DVD player or computer.* So why would I "upgrade" to a service that restricts me to a single device? Why pay more for less?
The bottom line: Music companies are finally giving customers what they want - DRM-free content. Video companies are still towing the DRM line and failing. I doubt this trend will change in 2008, but its an interesting study in contrasting approaches to new business models for online content distribution.
* Yes, yes, I know they have to be DVD-CCA approved, but most computers these days come with a software player that is and stand-alone players are under $40 and widely available. This is, of course, notwithstanding the DVD-CCA's severe contractual restrictions on competition and innovation that pose their own threats to economic growth in the DVD market.