Friday, 29 June 2007

Copy protection reduces profit

Recently, music company EMI started selling non-copy-protected tracks from its library at iTunes. Despite an increased price per track, those versions have been outselling the protected ones, some by as much as 500%. Keep in mind that these tracks are available completely free through illegal channels and cheaper through iTunes. If anyone wanted the music unprotected for free or legitimately cheaper, they had the option. Instead, they bought the unprotected tracks.

The lesson here is very simple: removing copy protection or DRM increases profits. Conversely, adding copy protection reduces profits. This is the point that anti-DRM activists have been making for ages, so it's nice to see it so clearly demonstrated on such a large scale.

Mokalus of Borg

PS - I doubt the lesson will be seen as such by other music companies.
PPS - They won't expect it to scale to the whole industry.

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