It was actually very easy to predict. One simply had to look at all the other companies who decided to turn off their DRM servers leaving their customers standing in the rain. All of them caved in after announcing that they would turn off their DRM servers.

Why don’t the decision makers look around first to get a feeling for what will happen if they announce the shutdown of DRM servers? It happened numerous times already in the last years and it always went off the same way. Company A announces the shutdown of their DRM servers. They usually do that by mailing their customers or posting an announcement in the online store.

The online community notices what company A is trying to do and is writing about it in protest. No one likes the decision of company A at that time. Bad press and customer complaints result in company A changing their mind and either providing their customers with a better deal or canceling the decision to turn off the servers.

Why can’t there be an instructions manual for overpaid managers who think that laying all the burden of turning off a service on the customer is a good idea that would save the company money?

Here is the original email send out by Walmart (via Engadget):

NOTE: This is a follow-up to our email titled “Important Information About Your Digital Music Purchases” from 9/26/08.

Based on feedback from our customers, we have decided to maintain our digital rights management (DRM) servers for the present time. What this means to you is that our existing service continues and there is no action required on your part. Our customer service team will continue to assist with DRM issues for protected windows media audio (WMA) files purchased from Walmart.com.

While our customer support team is available to assist you with any issues, we continue to recommend that you back up your songs by burning them to a recordable audio CD. By backing up your songs, you insure access to them from any personal computer at any time in the future.

We appreciate your support and patience as we work to provide the best service possible to you. As we move forward with our 100% MP3 store, we’ll continue to update you with key decisions regarding our service and your account via email.

Thank you for using Walmart MP3 Music Downloads.

The Walmart Digital Music Team

Who wants to bet on the next company that is making the same mistake?

Last week, Martin posted about how Yahoo was planning to shut down its Yahoo! Music store on 30^th September, 2008. The store would take its DRM servers offline on this date, in effect stranding all those people who had paid money for DRM-labeled music.

Apparently, Yahoo have realized the foolishness of their decision and the impact it will have on present and future customers of their services. They are now offering refunds to the people who bought music from the store. Another option being considered is to replace customers’ music with DRM-free MP3 versions of those same songs.

In addition, Yahoo! will transfer customers to the RealNetwork’s-owned Rhapsody service. This is for those people who have a subscription to the service. All these are far better than Yahoo!’s original suggestion that consumers burn the tracks to a CD and then rip that CD to get DRM-free versions of their tracks.

Yet again, problems have cropped up because of DRM. If the music from the store was DRM-free, shutting down the servers wouldn’t have affected anyone. Thanks to DRM, not only is Yahoo! going to lose a lot of its revenue but also lots of people are going to be inconvenienced.

I for one am waiting to see just how much Yahoo! will have to refund its customers. And whether Microsoft is going to follow its example. The real winner in all this is probably Rhapsody, who’s subscriber base will increase just like that. Let’s see what’s next on the DRM agenda, which seems to be falling apart. What do you think? Let me know in the comments.

Microsoft backpedaled quickly after it became apparent that the public was not that pleased with their decision and decided to keep the servers up and running for another three year period. The huge problem that arises when DRM servers are taken off the Internet is that the verification process will fail which means that users who want to move the music from an old to a new computer – where they had to verify the music again – would realize that they could not do so because of the server being offline.

Yahoo apparently did not pay attention to the media fiasco and decided to close the Yahoo! Music Store and take the DRM servers offline on September 30, 2008.

Yahoo is giving users of their music service the advise to burn the tracks to CD and rip those tracks on the new computer so that they would be able to listen to the music on a new computer as well.

If you needed another reason why DRM is bad then you got it. And it’s not that some small companies decided to turn off their servers, it’s two huge global corporations that decided to do it. (And Google did it as well before with Google Video)