Apple iTunes Goes DRM-Free
Expect an announcement at MacWorld today about Apple’s new plans for iTunes. After a year with EMI being the only label to offer DRM-Free songs on iTunes, Apple is expected to announce today that all tracks are to be DRM-Free by the end of 2009. Reportedly, Apple has inked deals with Warner Music Group, Sony, and Universal Music Group, all agreeing to allow DRM-Free songs to be sold on iTunes. Apple was way behind the times on this one, and I would bet that this move comes only after recognizing their slip in marketshare to outlets like the Amazon MP3 store who had strong selection, higher MP3 quality, lower prices, and a growing fan base for the better part of the past year.
Beyond the lack of Digital Rights Management, it looks as though there will be plans for labels to impose pricing brackets on songs within iTunes. While that may make iTunes more competitive with other online MP3 stores, rumor has it that many of the songs will actually go up in price rather than down. Back catalog tracks will be priced as low as 79 cents each, but newer hit songs are expected to jump in price. I have to assume these terms were part of the compromise in getting the major labels to come on board.
There are also unconfirmed rumors that Apple will be announcing a mobile iTunes store for iPhone users to download songs directly to their devices via AT&T’s 3G network.
Even with its inferior song quality and pricing, iTunes remained the top MP3 store on the net by linking use so tightly to the iPod. As the iPod blew up in popularity, iTunes was carried along with it. Over the past year or so, we’ve seen users begin to venture away from iTunes in favor of more consumer friendly music stores, though none ever really rose to threaten iTunes as the top seed. Now that Apple will finally ditch DRM, and potentially lower prices, this may all but ensure their online music dominance. Stores like WalMart, Amazon and eMusic will need to find a new way to compete.
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