Very good analogy. I agree 100%. Honestly I hated Itunes for the DRM and the relatively high price, so I was tempted to download illegal music. Then AllofMP3 sprang up. Now I know it may not be legal here in the US, but my “general sense of fairness” kicked in and all of the sudden I felt good about spending 13c(just realized there’s no “cents” symbol on a keybord) a song.

I am resigned to purchasing CDs.

I have had drives fail and needed to reinstall iTunes… each time this happens I give up another pc that the music can be access from as prescribed by Apple. With my luck, I won’t be able to use any iTunes purchased music (what with crapping out drives and other hardware upgrades and random freak accidents) in 2 years.

Is this fair? NYET!

Here is what I find amusing. The L.A. Times article says “A counterfeit DVD, for example, costs about 50 cents to produce but sells for at least $5 on the street. That makes it cheap for buyers and lucrative for bootleggers.”

It neglects to mention that a non-counterfeit DVD likewise costs about 50 cents to produce (actually, probably significantly less, due to the higher volume of production and economies of scale) and goes for closer to $15.

Who’s ripping their customers off more? The bootleggers, with a factor-of-10 markup, or the “legitimate” recording industry, with a factor-of-30-or-more markup?

(And whichever you buy from, the artists are lucky to see a thin dime in royalties. The bootleggers are actually more honest; people buying from a bootlegger probably suspect the artist won’t see a cent of their money just spent, whereas people buying from the local HMV probably don’t suspect, especially given the recording industry’s frequent loud rhetoric about artists having to get paid when denouncing bootlegging and downloads.)

Here is an idea. If you don’t like the price, don’t buy it. Oh, I know, the industry is turning its customers into crooks.

I want a Mercedes but I can’t afford it so its ok to steal it.

It’s not a question of not being able to afford it, it is that the price is too high for what you are getting especially in the case of downloadable music – even more so for DRM’d downloads.

Rewind back to the 80’s when companies were selling VHS and Cassettes. One of the large “Yes, please.” factors to moving to CDs and DVDs was that those media types cost less to manufacture… Yet when they came out, they charged more for them than the older VHS/Cassettes. A lot of people were angry about this, and a lot of people went on to obtain illegal copies “in protest” of their decision to charge more for something that was cheaper.

Now we move to downloads for music and movies. These cost even LESS to produce, and a website does not require a large sales and manufacturing workforce to man it. This “should” result in an even cheaper product, right? Wrong. The downloads still cost the same, and sometimes even more when you compound 99 cents per song. AoMP3 was charging about what it should have cost for much of their music – $1-$2 per album, with a sliding scale based on track length. This allowed you to get a track from an album like “1. Intro 0:42” for only a few cents, rather than the 99 cents like the other online retailers. The big name websites could learn a thing or two from this…

Then you add DRM on top of it all, and this costs money. The company had to pay the initial costs to develop the system, and has to host a licensing server for the music/movies to call home to. This is very expensive in comparison to non-DRM distribution methods – and guess what? The cost is passed off onto the consumer, making your downloads cost more than they should.

DRM also gets problematic in that you do not have full control over your media. You can delete it from one computer and put it on another instead, you can only burn one or two copies to disc, so on and so on. What happens when you replace your computer more than once in your lifetime? Or maybe you keep losing or scratching the CD that you burned? Too bad, you gotta buy it all over again. This is ridiculous.

I personally refuse to purchase music or movies online for more than it would cost to buy it from a store. I’d rather pay less and get the actual CD/DVD including the package. I also refuse to buy any media which contains DRM. It is a waste of money for me to invest in those tracks on the offchance that I need to make more legitimate/legal copies of the media than they think is fair.

“I want a Mercedes but I can’t afford it so it’s okay to steal it.” is not how these people are thinking who download music illegally. The amount of money people have is not at issue here. The people downloading music/movies without paying for it come from all walks of life. Some are poor, some are middle class, and some are millionaires.

The notion remains that if they dropped the price of online media to better represent the cost of bringing it to you, I would personally guarantee that the number of unique customers and the volume of sales would increase, while the number of illegal downloads would decrease. There will always be people who find it nice to still get things for free – that won’t go away, but you can still bring back the ones who WANT to buy the music legally, but can not justify paying their insane rates.

Take that $70k Mercedes you used in your example, take out the increase in price the dealership is charging, strip out all of the optional accessories (but hint that it still has them in your online ad), and then tell me that I can only drive it 15 miles a day, and that the car company will track me on GPS 24-hours a day to see that I do not park my car at a friends house when I visit him, and that no one else may ride in the car aside from yourself… And charge $75k for “removing the dealership” (middleman). THIS is the problem with buying online music with DRM, and why people are avoiding it.