DRM-Free MP3s: Not really DRM-free

MP3 files from popular online stores such as iTunes are ostensibly free of digital rights management, but they still contain information about the listener that could be used to enforce DRM in the cloud some day, according to a music industry source.

It’s already known that Walmart, Apple and Lala embed the name of the music purchaser into the file. The obvious use would be to identify people who seed music on BitTorrent sites, but an anonymous insider told TechCrunch there’s a more elaborate plan at work.

Record labels, the source said, want to use these so-called “dirty MP3s” as an authentication method for cloud music. It’s been said that Apple acquired Lala to get the startup’s streaming music technology, which can bring a user’s local MP3 library into the cloud. The labels reportedly want to tie cloud music streaming to individual users, and the personal information stored in MP3 files is the key.

The problem for record labels, according to the source, is that they need everyone on board. Among the online music shops that don’t encode user information are Amazon and Napster. I’m not sure why the scheme can’t go ahead without their support, though. I would think Apple and Walmart would love a cloud service that requires songs to be purchased from their respective stores, but maybe the labels want a system that’s more universal.

In any case, the source reckons that encoding personal information into MP3s without making it clear to customers is a bad idea. “If Barnes and Noble printed your name on pages of books you purchase that would be important information to know because it would affect the value of your book, the insider wrote. “Here the clandestine actions are even more worrisome because it could lead to a future lockdown of purchases.”

Amen, but it’s all theoretical for now. Labels have the right to make sure that cloud music services don’t turn into free-for-alls, but paying music listeners need hassle-free access to those services, or there’s just no point.