At the beginning of this year, the mobile phone industry had agreed on a $1 DRM levy per handset for implementing the Open Media Alliance (OMA) DRM 1.0 or 2.0. However some consumer electronics and mobile phone manufacturers are now going against the $1 levy claiming that the levy is too high a price to pay just to protect against music and video copyright infringement.
A top five mobile phone manufacturer senior executive made a point that 684 million phones were sold last year and if every phone where to include the levy, this would work out at $684m in levies. However, if all the digital music sales made online last year were tallied up, they would not even amount to half this value.
Mobile phone operators are not the only ones complaining as consumer electronics makers who make devices that connect to the mobile to upload and download tracks must also pay the levy. On the other hand, the mobile and electronics manufacturers still need OMA in order to avoid closed systems like the ring-tone business where a user can only access music stores that offer music compatible with their brand or model of multimedia handset.
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Mobile phone makers and consumer electronics makers said $1 per device is too high a price only to protect music and video against illegal copying. They will not be able to recoup that money through revenues expected from digital entertainment. "This kind of price is certainly unreasonable. It's not in proportion to the economic value," said one senior executive at a top five mobile phone maker who declined to be named. He points out that last year alone 684 million mobile phones were sold. If handset makers had put anti-piracy protection software in those phones, the $684 million in royalties would have exceeded total digital music sales on the Web last year. Read the full article here. |
If the music industry thought of developing an open standard to start with and charged a similar levy, they would in my opinion make more revenue from these levies than all the losses incurred by those who decided to download their music from P2P rather than purchase it elsewhere.
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Source: Reuters - Technology
