Forgive our skepticism: the logic behind this alleged development is flawed.  To us, the question is whether the flaws in logic are those of journalists or the music industry itself.

The logic goes something like this: digital music sales are up but not enough to offset the decline in CD sales.  Therefore, to increase digital music sales, the best hope is to make digital products more attractive by jettisoning DRM and making music files freely copyable. 

This is going to boost digital music revenue?  We'd love to see the assumptions, models, or research on which this seemingly bizarre assertion is based.  Where are the studies that show, for example, the effect of existing -- or hypothetical better future -- DRM on piracy and compare that to the rate at which overly restrictive DRM drives people to illegitimate means of obtaining digital music?

Of course, there is an "elephant in the room" where these discussions are taking place: Apple.  Some of the people quoted in these articles on the death of DRM are from service providers, like Yahoo, whose share of the paid digital music market is minuscule compared to Apple. And the major music companies are unhappy with what they view as Apple's overly restrictive scheme for music licensing, including lack of variable pricing and DRM that is, depending on whom you talk to, either too inflexible or too porous.

Creating digital music services with DRM that is looser than Apple's FairPlay is certainly one way to woo users away from iTunes, possibly more effective than other methods that companies like Microsoft and RealNetworks have tried so far.  This makes especially good sense to consumer electronics firms and service providers, because less DRM means less cost to them.  But it makes less sense to record companies, because they earn royalties from digital music sales no matter where they come from.

Note that we say "less DRM" rather than "no DRM."  It depends on one's definition of DRM, of course, but if one uses a broader definition, DRM certainly isn't going away.  Acoustic fingerprinting -- examining the bits of a file to determine the identity of its content, then acting accordingly -- is gaining traction, as are certain advanced variations on digital watermarking, such as so-called transactional watermarking -- embedding the identity of the user into a downloaded file.  Both techniques are used in content services that are licensed by major music and video content owners.  Both can be used either in lieu of or alongside encryption.

Short of a hard-nosed financial analysis of the tradeoffs between DRM and free access to content, we don't see music companies having good enough reasons to dump DRM right now.  Such analysis really ought to include predictions of the effect on the digital music market of DRM that is better than what's available today.  If music companies really understood these numbers, then they might well decide that better DRM -- by which we mean more interoperable, flexible, and consumer-friendly, not just more secure -- is worth paying for and co-developing it with technology vendors.

We might change our mind if we saw other evidence of a clear path from DRM abolition to increased digital music revenue.  One such piece of evidence might be a deal with a major retailer to market DRM-free music in such a high-profile way that consumers might possibly change their music-purchasing habits quickly and on a large scale.  We're thinking particularly of Amazon and Target, two huge retailers that have yet to roll out full-blown digital music strategies. 

Moreover, we would have expected an announcement of such a deal at MIDEM this past week.  Seeing none, we don't see DRM disappearing from the major labels' agenda anytime soon.

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