Edgar Bronfman Jr. defended the use of digital rights management — a reaction to recent criticism from Apple CEO Steve Jobs — but then praised the Apple iPhone for raising the bar on what customers should expect from a mobile phone.
“DRM and interoperability are not the same thing,” the chairman-CEO of Warner Music Group said in a speech at the 3GSM World Congress in Barcelona on Wednesday. “We believe in interoperability. Consumers want it and should have it. We at Warner, and I hope the rest of the music and content industry, will make it as easy as possible to achieve interoperability.”
Bronfman did not mention Jobs or Apple by name in a speech whose dominant theme was his belief that music companies and phone companies are leaving money on the table by not making the transfer of music to mobile devices seamless.
He cited unnamed studies predicting that consumers will spend $9 billion this year on mobile music, including ringtones and over-the-air music downloads. By 2010, mobile subscribers will spend more than $32 billion to access music through their phones.
Currently, however, only 8.5% of mobile service subs use phones to buy music.
“Our essential challenge is to make it affordable, easy and quick to download tones and songs as well as new music experiences — including video — to our mobile phones,” Bronfman said. “We need to think about offering more than just better devices, services and prices. We need to think beyond the music we offer to the music experiences we can offer.”
Warner, he said, is working on how to create constant flow of product and information from artists, including video, artwork and text.
Bronfman used the speech to announce three Warner Music Group deals. Company has partnered with Orascom Telecom to deliver music-based content and services to consumers in 16 countries in the Middle East and North Africa. In the same region, WMG is linking with O-Media Holdings, a major independent media venture, to explore new ways to connect with music fans through local music cultures.
Warner has also formed a strategic partnership with Telenor to develop business in regions including south Asia. Company will be selling full-length songs, ringtones, ringback tones, mobile musicvideos and wallpapers to Telenor’s subscriber base, currently 105 million people in 13 countries.
“I want to emphasize that even though we think globally, localizing our products is still critical,” Bronfman noted. “Operating in 50 countries — and cultivating local artists around the globe — Warner Music is now partnering with mobile carriers just about everywhere to develop local, regional and culture-specific music services.”
Bronfman closed his speech by recalling the days of the LP and suggested that consumers are asked to go to three places to get the full experience: the music, the visuals and the liner notes.
“That’s what we’re asking many of our customers to do today, instead of giving them a really great music experience,” he said. “And that means lost opportunity for everyone: for Warner Music, for all of you and for those frustrated consumers. We know the basic technology exists to overcome the obstacles the industry faces today. Now it’s just a matter of putting it to work.”
(Wire services contributed to this report. )