eMusic recently announced that they’ve reached a milestone, having sold 100 million songs as unencrypted (DRM-free) MP3s.
Tech bloggers are freaking out about the news:
- Digital Music News asks “So, uh, Mr. Major Label executive guy; How many million DRM free tracks does eMusic have to sell before you join the party? No, really.. how many?”
- Techdirt says that DRM-free music is the way to go, and that the major music labels are pretending that the jury is still out.
- MacWorld says that the labels are mulling life without DRM.
- WebProNews warns that they are going to keep slamming on Apple’s “rotten to the core” DRM in response to the “ever-growing consumer backlash revolving around Digital Rights Management.”
These guys need a reality check. Like it or not, sales of non-DRM’d music are trivial in the context of music industry sales, they are insignificant compared to the sales of DRM’d tracks at iTunes, and they don’t offer artists a serious new option for making money.
Here are a few reasons why it would be a mistake to bet on DRM-free music anytime soon:
- Most music fans don’t care about DRM. Ask a typical music fan what DRM is, and most are going to shrug their shoulders. While copy protection may be a big pet peeve for the Linux crowd, most people have know idea what it is, and if they do, they don’t care.
- eMusic doesn’t really sell songs, they sell subscriptions. eMusic doesn’t really sell individual songs, like iTunes does. They sell subscriptions. Until recently, they charged $10 for 40 downloads/month, about a quarter per song.
- Labels aren’t going to get rich from eMusic. At $.25/song, 100 million songs, sold in three years is about $8 million/year. The RIAA’s figures for 2005 music industry sales are 12.27 billion dollars.
- eMusic’s sales are less than 1% Apple’s. Apple’s sales of DRM’d tracks are about 1 billion/year.
- eMusic’s traffic has flatlined over the last year, according to Alexa traffic charts (below), except for a spike when eMusic offered 50 free tracks as a promotion.
- Musicians aren’t going to get rich at eMusic, either. eMusic claims a catalog of 2 million tracks. With about 50 million downloads last year, that averages out to be 25 downloads per track. And at $.25 per download, eMusic is making about $6.25 a song. Take eMusic’s cut off the top, split the rest with the record label and you can see why eMusic sales aren’t going to help artists quit their day jobs.
Tech blogger’s anti-DRM screeds may play to the choir, but, even a decade into the Internet digital music revolution, DRM’d tracks are still where the money is at.
Update: Gareth Stack posts a well reasoned counter-argument to this post at his blog, Hummingbird Mentality. It’s an interesting read, though we’re not convinced.
One note - he takes issue with my characterization of eMusic’s service as a subscription, saying you get to keep the songs. I think he may have misunderstood my point - that you’re not buying songs with eMusic, you’re buying a subscription.
Here’s eMusic’s info:
Q: What subscription programs does eMusic offer?A: eMusic offers three low priced subscription plans.
eMusic Basic
- 30 Song Downloads per month
- $9.99 per month
eMusic Plus
- 50 Song Downloads per month
- $14.99 per month
eMusic Premium
- 75 Song Downloads per month
- $19.99 per month
You don’t buy a song at eMusic, you buy a subscription that gives you X “free” songs/months. This affects purchasing behavior - people are going to download a lot of songs from eMusic in order to use up their monthly count that they wouldn’t necessarily purchase otherwise.
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Tags: copy protection, DRMmp3s, eMusic, itunes, music downloads, music stores.
the money COULD be at non-DRM if and once more people get on it. itunes only makes the money it does because the ipod drives people to it. 99 cents per song is a rip off, especially for the quality they are providing.
so when artist can’t make money who is going to pay for them to eat. Music could be free when musicians can go into any shop and not pay for anything they take. Roll on the non paying world of Nirvana where everything is free but untill then…..
Why do bloggers happily pay internet companies for access to the net, pay mobile phone companie to use a mobile, buy computers, buy cars, buy food, buy electricity, buy alcohol and cigarettes but object to paying for music….they must all hate music.
Huh, interesting article and you do make some valid points.
1) You are correct, for now. DRM still hasn’t penetrated the market to such a point where it inconveniences the general public. Still, when a user upgrades from an older PlayForSure device to a Zune or iPod and finds that the music they purchased isn’t going to work on it, they are going to be a little pissed.
2) Que? Seriously, you do keep the music man.
3) Yup, you got that one right, which is why the labels won’t like it. Thankfully there is a small, but growing, trend for bands to skirt the majors as the majors seek to reduce royalties, cut into ticket & merch sales(1).
4 & 5) Again, spot on.
6) That’s more than they get from the majors now man, and the labels want to reduce what they are getting now(2). They will get more cashish from emusic, not that royalties or CD sales where the sweetest cherry.
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Bloggers are doing the preaching now because they are, generally, more technically inclined and can see the problems that a DRM’ed future bring.
(1)http://tinfoilmusic.net/content/view/1734/2/
(2) http://tinfoilmusic.net/content/view/1724/2/
sounds like your issue is more with non-apple digital music sales in general rather than emusic in particular. really, you’d prefer a monopoly on digital sales. to each his own i guess, but i kind of like the idea that i don’t have to buy from one place whose songs won’t play on my sandisk mp3 player.
as for artists not making money, is there any way they actually do make money from record sales? not that i’ve heard of, unless they’re britney spears.
it’s also odd that you call non-DRMed mp3s “a new option” when it’s DRM that’s the new thing.
enjoy your restrictions.
tinfoil - you don’t pay for individual tracks - you pay for a subscription that gives you x number of tracks per month. This may seem like a subtle distinction - but you can bet that at the end of the month there are a lot of people downloading @#$# that they wouldn’t pay for otherwise.
Nathan - the post discusses why bloggers don’t run record companies and how eMusic’s milestone doesn’t really mean much to the music business. Why do people like you think this means that I prefer a monopoly?
It doesn’t - it just means that it’s common in the blogging world for pretty smart people to talk out their rears about the music business without taking a moment to through their positions.
I’d like musicians to get paid and music to be free. I also like puppies, babies and hope for world peace.
Axe, I understand the distinction now that you point it out, and I will grant you the point.
I still stand by my point that the musicians stand to make more selling directly via services such as emusic than they do with the labels.
I do like to see musicians paid. It would be an understatement to say that it is vital. I am a musician and have made my cash. Thankfully I’m done now and have a day job.
tinfoil
Musicians shouldn’t expect to make much money on eMusic.
You put your blood, sweat and tears into making an album, you publish it on the site, and then you make $6.25 a song. Not a good plan.
I’m with you 100%, though, thinking that musicians deserve to get paid well - I’m just not convinced that working as a musical sharecropper is a good strategy.
Musicians today are better off creating their own site and using MySpace and other popular free sites to help establish themselves. This is probably not going to lead to the mega-success, though, that lots of musicians dream about.