Why does the record industry hate music lockers?

Apple's first attempt to launch a music locker service based on Lala technology reportedly was rejected by copyright owners who wanted more money.

Once again, it looks as if the recording industry is standing square in the way of giving users what they want: access to their digital-music collections from any device in any location.

Earlier on Friday , a notice appeared on Lala, announcing that the service would be shut down on May 31. Apple acquired Lala in late 2009, and a lot of folks have speculated that Apple would launch its own version of Lala's online-music locker service , which enables users to upload their music collections to Lala's servers, then stream those songs to any Internet-connected device.

(Technically, users don't upload actual music files to Lala, as they do with MP3Tunes . Rather, users upload metadata about their music collections, and Lala then enables them to stream the songs from its servers.)

Unfortunately, according to a report from All Things Digital's Peter Kafka, music fans shouldn't expect Lala's music locker functionality to find its way into iTunes or MobileMe anytime soon.

According to the report, Apple approached record labels and other copyright owners about launching a music locker this year, but the idea was shot down. Copyright owners apparently want more money for streams than they're currently getting for iTunes downloads. Or at least more money than Apple was willing to offer for this service.

I can't confirm the story, but it seems perfectly in character: in the past decade, major labels have filed lawsuits against two music locker companies founded by Michael Robertson--MP3.com and MP3Tunes.com. For some reason, the big recording industry doesn't like the idea of allowing users to store their music collections anywhere but on their own computers and MP3 players.

From a user perspective, this makes no sense at all. It's not like users are getting free unlimited streams of every song ever recorded, as they can with on-demand services such as Grooveshark (which is currently a target of a lawsuit by Universal Music ). These are songs users already have on their hard drives.

It's not like we're still living in the DRM (digital rights management) days, when downloads were restricted from being played on multiple devices. Users can take a download from iTunes or Amazon.com, and copy it to as many devices as they want, and the labels no longer object to that behavior. So what's the objection with streaming, as opposed to physical transfers?

I imagine that the problem arises from the different royalty rates and structures for downloads and streams. For example, if a record label collects a one-time payment for a download, but the artist's contract stipulates a certain rate per stream, then it's possible to see how the label would lose money pretty quickly. But the concept of a music locker has been around for more than 10 years. Why couldn't the armies of lawyers in the music business plan for this day?

If you persistently refuse to let customers use your product in the way they want to use it, they'll stop buying it. Ten years of stiff revenue declines in the recorded music business should have made that lesson clear.
 

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