At CES this week, SonyBMG announced its entrance into the DRM-free world and a new “album card” initiative. Both are big steps in the right direction.

Sony BMG couldn't afford to be the lone holdout against DRM-free, so that move was expected. Nonetheless, it is important that the industry has uniformly taken this step now, allowing retailers like Amazon and Napster to present a broad offering including all the majors.


In my view, the experiment with album cards is most interesting... SonyBMG is moving into DRM-free in a smart way. Sony BMG figured out a way to push sales of networked media (aka digital downloads) into the retail environment. Even better, the strategy maintains the notion and value of the album.

According to Billboard.com, the cards will be artist-specific with cover art or artist images that create an emotional aspect to the purchase. The cards will also offer bonus materials as part of the package to consumers. Both these nuances are an improvement over iTunes’ sterile gift cards.

From an inventory management standpoint, the cards are a quantum leap forward from CD's. Breakage and unsold product are problems of the past… The “unactivated” cards can simply be discarded. And, the cards will prove easier than CD’s to distribute the through smaller outlets like convenience stores, coffee shops, and grocery stores.

It’s also a move for SonyBMG is to build direct relationships with consumers through MusicPass. That’s significant, and I expect the other majors to jump in for that reason. (That said, I have to wonder if any of the retailers took issue with sending consumers to MusicPass instead of "retailer.com".)

The only critique I can offer is that the solution requires consumers to return to their home PC to download the music. In other words, immediacy is an issue... When I buy a CD, I can play it in the car as I’m driving out of the parking lot.

The answer to that problem is the eventual migration to web locker solutions that can immediately synch new purchases to both the consumer’s cell phone and their home PC. Of course, MediaMaster will help with that. More on web lockers tomorrow.