Does Copy Protection Hamper Sales?

If stats from U.K. music e-tailer 7 Digital are any indication (by way of Ars Technica), then the answer to the headline would be, “yes.” Music with digital rights management (DRM) is four times less likely to sell than tracks without DRM protection. Additionally, those who buy DRM-free music are much more likely to purchase full albums.

Earlier, BNET1 noted efforts by Paramount and other movie studios to undercut prices from movie pirates in Asia. Maybe the correct strategy is to offer consumers the DRM-free content they demand, and at a lower price; the studios have taken care of step 1, but will they implement step 2? Are the studios and publishers of copyrighted content like cartels, or are consumers expecting too much freedom in this post-Napster free-for-all?

DRM CD Lock image by rebopper [cc, 2.0]