In a move that could have a big impact on online music, Apple and EMI announced Monday that iTunes would begin selling most of EMI's library both with and without copy protection. The Beatles' music, which has not been available for online sales, was specifically excluded from the deal.
The announcement means that at least some non-iPod devices will now be able to play songs from iTunes.
At a joint press conference in London, Apple CEO Steve Jobs and EMI CEO Eric Nicoli said that EMI tracks would be available worldwide in May without digital-rights management (DRM) and at a higher quality (256 Kbps versus the 128 Kbps of current iTunes songs).
By dropping DRM, the two companies allow those songs to be copied and played, without restriction, on an unlimited number of computers, portable music players, or other devices. EMI Music is the first major label to sell songs online without DRM. The EMI library includes Norah Jones, the Rolling Stones, Coldplay, and many others.
No Longer Just iPod
"The key to this whole deal," said Samir Bhavnani, Director of Research at technology research firm Current Analysis, is that iTunes will no longer be limited only to iPod customers. "Open AAC can play on other devices," he said, such as Microsoft's Zune, SanDisk's Sansa, and others.
Apple said in a statement that iTunes customers will have the ability to download tracks from their favorite EMI artists "without any usage restrictions" that limit the types of devices or number of computers on which those songs can be played.
The unrestricted, higher-quality music singles will be sold at a higher price of $1.29. The normal iTunes price of 99 cents per song will remain for the rest of Apple's offerings. Current iTunes customers can upgrade previous purchases of EMI songs to the unrestricted, 256-Kbps version for 30 cents each. Apple said customers will be able to upgrade their entire EMI library with one click.
EMI music videos also will be available on iTunes as DRM-free downloads, but without a change in price.
Jobs made clear that the move toward DRM-free downloads will expand beyond EMI music. "We think our customers are going to love this," Jobs said in a statement, "and we expect to offer more than half of the songs on iTunes in DRM-free versions by the end of this year."
DRM as Tracking Mechanism
"People really like the iPod," said Bruce McGregor, an analyst with technology research firm Current Analysis, but they don't like restrictions, such as being limited to a certain number of song plays or forced to install the songs on certain devices.
Michael McGuire, an analyst with Gartner, noted that Apple not only is opening up its non-DRM songs to other devices, but also is increasing the quality as well. "Online consumers have said that they would pay more for DRM-free music that has a higher encoding," he said.
The future of DRM, he predicted, might be "less as a lock and more as a tracking mechanism," especially for "other business models, such as subscriptions or ad-supported models." DRM might still have a future with online-distributed movies, he said, where the "viewers' expectations of ownership" are different from song owners' expectations of multiple playbacks on many devices.
Earlier this year, Jobs began publicly asking record companies to drop DRM requirements for online sales. He has argued that record labels sell CDs without DRM, so DRM primarily hurts online sales.