Apple has filed for a new patent that could change how digital rights management is handled in its music properties. The patent covers the technology “for enabling a user to obtain rights in a legitimate copy of a digital content unit without downloading the copy from a digital content store.” This approach gives an encrypted copy of the song to the initial buyer, then “transfers the encrypted copy to generate the legitimate copy to a second user.”
In plain English, that means you could potentially share files downloaded from the iTunes store. It could also lead to a new pricing structure, where an initial buyer pays a one cost for the download and the second user pays a different price for the authorization without a download. “This may encourage users to trade or copy digital content units as well as authorize these copies,” the patent says. “Such sharing may, in turn, reduce piracy or illegal copying since the opportunity cost of having one or more rights in an authorized copy of the digital content unit may be reduced.”
This shift to a two-tier price scheme could be a helpful change for Apple, which has been seeing an accelerating decline in revenue from the iTunes Store. A price structure that’s more open to sharing and lower costs for listeners could add a second revenue stream, even as sales (presumably) continue to fade. Also, the patent could have applications for Beats Music whenever it formally re-launches under the Apple banner. Might Beats also have a song-sharing feature? We’ll have to wait and see.
This also has the potential to alienate customers, as we witnessed with the previous two DRM attempts, especially with FairPlay. iTunes is not the only game in town now, everyone has found alternatives to that, and many may just outright skip iTunes altogether. We’ll see some benefits to this, but the potential alienation of customers is another issue.
Pirate sites will also benefit from this, as some will once they’ve heard the track, go to another site that pirates stuff and grab it there, we could be in for ‘Napster Part II’ here. That’s my worry.