Monday, June 30, 2008
Gates Logs Off

These devices are just repositories for stolen music, and they all know it. So it’s time to get paid for it.”
–Universal Music Group Chairman/CEO Doug Morris on digital music players, November 2006
Universal Music Group appears to have finally taken Steve Jobs’s “Thoughts on Music” essay to heart–although not in the way the Apple CEO might have imagined. Heeding Jobs’s call to abandon digital-rights management, the company announced late yesterday that it will sell at least some of its music catalog online without copy protection for the next few months. Described by UMG as a “test” of the DRM-free option, the effort will see the label selling DRM-free tunes through retailers like Amazon.com, RealNetworks’ Rhapsody and Best Buy.
But not Apple’s iTunes.
Why exclude the third largest music retailer in the United States? Publicly, Universal claims it’s so that iTunes could serve as a “control group” against which to compare its sale of DRM-free downloads elsewhere.
A plausible explanation, but improbable. More than likely, this is an effort to temper Apple’s growing influence in the music industry. A month ago, Universal scrapped its long-term contract with iTunes, opting instead to continue the arrangement on an at-will basis that will give it an easy exit should disagreements over pricing become a problem.
And make no mistake, pricing is a problem. Apple is the No. 3 music retailer overall, according to NPD Group, and its ubiquity in the download space has given the company serious leverage in negotiating pricing with the major record labels. It’s fairly clear then that UMG’s DRM-free effort is a “test” not just of unrestricted digital formats, but of Apple’s growing influence in the music industry.
Said Mike McGuire, vice president of research at Gartner, “It seems like a boldfaced move to blunt Apple’s influence.”
John Paczkowski has been poking fun at the tech industry and the personalities that drive it since 1997. From 1999 to 2007, he wrote the award-winning tech news Web log Good Morning Silicon Valley for the San Jose Mercury News, Silicon Valley's daily newspaper.
Here is a statement of my ethics and coverage policies. It is more than most of you want to know, but, in the age of suspicion of the media, I am laying it all out.
Stop Making the Sixth Sense
Best Little Whorehouse in The Texas Chainsaw Massacre
Air Force One Flew Over the Cuckoos Nest
Bad Taste Santa
…in 80 milliseconds.
We sat next to each other in math. We didn’t get on, remember? Want to be my friend?
PRO TIP: You can create an effective diversion using sheep or cattle brains.
Just killed one inside. Pics for proof. This is insane.
With antlers on a headband
The Death Star over San Francisco
Inferring personality from email addresses
A lifetime of CNN in two minutes
With Apple CEO Steve Jobs sitting in for the lovable tiger …