It’s Over (or just beginning): iTunes is DRM-Free

by -DjD- on January 7, 2009

Filed under: Analysis

It’s been a bit of a battle over the last few years but DRM-free music is finally here. Let’s recap:

~2006 and prior – Music industry can’t fathom the possability of DRM-Free music… it will be the end of the Industry.

Feb 2007 – Steve Jobs writes ‘Thoughts on Music‘.

The third alternative is to abolish DRMs entirely. Imagine a world where every online store sells DRM-free music encoded in open licensable formats. In such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players. This is clearly the best alternative for consumers, and Apple would embrace it in a heartbeat. If the big four music companies would license Apple their music without the requirement that it be protected with a DRM, we would switch to selling only DRM-free music on our iTunes store.

May 2007 – EMI (one of the ‘Big 4′) provides it’s entire music catalog to iTunes DRM-Free. Songs are available at a higher 256kbps quality and previously purchased tracks can be upgraded for the price difference (~$0.29/track) automatically.

June 2007 – iTunes surpasses Amazon and moves into the #3 spot for US music sales.

Sep 2007 – Amazon launches DRM-Free MP3 store with 2 million tracks including those from EMI and Universal . They later add Warner in Dec and Sony BMG in Jan 2008, thus becoming the first online store to offer DRM-Free music from the ‘Big 4′. Analysts believe this will loosen the grip of iTunes over the music industry.

Jan 2008 – iTunes becomes the #1 music retailer in the US, surpassing brick and mortar giants Best Buy and Walmart. Amazon remains in fourth with 6% market share.

Dec 2008 – Amazon is growing while physical CD sales slump, but still no rival to iTunes.

But Piper Jaffray financial analyst Gene Munster estimates that Amazon will sell 130 million tracks this year — a paltry sum compared with the 2.4 billion songs iTunes is expected to sell in 2008.

Yesterday – The Industry realizes, digital is where it’s at. Apple announces full iTunes catalog is going to iTunes Plus format. (DRM-Free, 256kbps, fully compatible with Mac/PC/iPod/Zune/Squeezecenter/etc). 8 million DRM-Free tracks available now. Remaining 2+ million coming by end of Q1.

Digital music is here to stay. Next up digital video.