Yahoo! Music VP and GM David Goldberg spoke on the need for innovative digital music marketing and the problems with DRM at the iHollywood Forum Music 2.0 conference.

He compared digital music marketing to that for water. P2P advocates have been making the same points for five years now.

From the Digital Music News article:

What are the biggest challenges facing the online music market today? According to David Goldberg of Yahoo Music, convincing consumers to pay for something they can get for free is half the battle. "Most people believe they can get enough value from what they get for free," Goldberg said during a Music 2.0 keynote in Los Angeles, alluding to a number of easy methods for acquiring gratis content online. That puts stores like Yahoo Music Unlimited in a tough position, especially when it comes to younger buyers. To solve the issue, Goldberg pointed to a number of strategies and innovations. That includes better playlist features, effective personal recommendations, better distribution across devices and platforms, and more seamless billing. Throughout, Goldberg drew a parallel to the successes of Evian, one of the first bottled water giants. For Goldberg, continued innovation will help to power a $30 billion digital music market ahead, which will consist mainly of transaction-based, subscription, and ad-supported content.

The pressure to create viable markets online is intense, especially as traditional sales outlets continue to lose steam. Goldberg noted that many consumers are not making repeat visits to paid music stores, deterred by aggressive price points and onerous usage restrictions. "There is a cost associated with DRM, and that is lost sales of content," Goldberg said, cutting against the prevailing major label philosophy. Goldberg called for more innovation, and encouraged the industry to experiment with more MP3-based sales plays. Citing the successes of eMusic, which offers its tracks in unprotected MP3s, Goldberg predicted that overall sales volumes would not be adversely affected by such a move. Meanwhile, Goldberg noted that the Yahoo Music Engine and MusicMatch will be merged into one application later this year.