To get an idea of ​​where online music is headed, it’s important to understand the history. Think back to the time when music downloads first became popular. For me it was stimulated in the early days of Napster. Everyone was going crazy grabbing all the music they could find without consequence. Then the RIAA came along and said, “wait guys, it’s our copyrighted content you’re downloading.” Since then, the RIAA has been fighting an uphill battle to end copyright infringement.

After the early days of Napster and peer-to-peer file sharing, a new generation of sites appeared offering legal music downloads. Even Napster went legit by signing deals with major record labels to offer unlimited access to their offerings. To make this happen, the recording industry had to come up with a way to protect their investment.

Digital rights management (DRM) has arrived. New DRM technologies have been used to limit access to media. In essence, as long as you’re a Rhapsody subscriber, for example, you can download and listen to as many songs as you want. You can even play them on your mp3 player (excluding iPod and Zune). The DRM is activated by restricting the number of devices you have access from and cutting off access entirely when the subscription ends.

Additionally, companies chose to run their own brand of DRM. This means that if you own an iPod or Zune player, your options are severely restricted. Apple and Microsoft go to great lengths to force you to use the iTunes and Zune Marketplace.

Things have changed a lot in the last two years. Online retailers, including Amazon and Wal-Mart, have signed deals with major record labels to sell DRM-free song downloads. The key here is that you are paying a fee for each MP3 song you download, but you get the music without any DRM restrictions. Even iTunes has started offering DRM free downloads.

Another challenge facing online media companies is the ISP’s battle to reduce network traffic and thus reduce congestion during peak hours. The lack of network infrastructure, particularly in the US, is a big concern. Limiting traffic or charging customers for metered access, as Comcast and Time Warner are currently testing, could scare off customers. We no longer live in a world of text email and static web pages. The sites now offer rich content including streaming audio and video, social integration, and an interactive environment for people to come together just like they would at their local watering hole. Hopefully customers will voice their concerns and ISPs, in turn, will expand their network infrastructures to meet our ever-increasing bandwidth needs.

Where does this lead us? I remember mentioning the excitement about the future of online downloads before my rants. Online music sites look to the future. With the ability to download songs to your PC, mobile phone, or other web-enabled devices, you’ll have access to the latest songs anywhere, anytime. Sites like eMusic, Amazon MP3, and Wal-Mart Music have proven that DRM-free music is the way of the future. The next step will be to find a way for sites like Rhapsody and Napster to offer unlimited access to DRM-free music for a monthly subscription fee. I’ll be the first to admit that this is not an easy task, but it could be very profitable for the music industry in this ever-growing digital age.

The excitement extends beyond music, as companies like Netflix offer a huge selection of free movie downloads for subscribers. We’re not talking about just watching on your PC, either. With a set-top box, you can download movies to watch right on your TV. Industry insiders predict that a few years from now you won’t be going to your local video store to rent the latest DVD movies. Instead, you’ll simply watch them anytime on demand via download. Alright, I can hear some of you saying yes, but how long do the movies take to download? I can tell you that with Netflix I can start watching about 30 seconds after the download starts. The rest of the movie downloads while I enjoy it.

In conclusion, the future of online media is shining bright. Customer spending habits can help record labels and ISPs accept that the future of music and movies is online, not in record and video stores. The instant gratification of accessing millions of songs or thinking of a movie and seeing it a minute later is enough to make you want to stop writing. So sit back, relax and enjoy what the future holds.