Finally - EMI and Itunes to offer non-DRM sales

EMI, Apple Announce DRM-Free Digital Sales Plan

EMI and Apple will now sell DRM-free catalog on the iTunes Store, according to a joint announcement issued today. The move is groundbreaking, and shatters a previously ironclad commitment to digital protections by the major labels. The decision means that well-known tracks from artists like the Rolling Stones, Norah Jones, Lily Allen, and Janet Jackson can now be downloaded in a protection-free format, an approach that eliminates usage and sharing restrictions. The company pointed to a refreshed product line that will feature "a much higher sound quality than existing downloads," and one that will be "free of digital rights management (DRM) restrictions". Specifically, the label will offer its catalog to digital music stores in a range of higher bitrates, including CD-quality fidelities. According to Steve Jobs, the DRM-free offering will be exclusively unveiled by iTunes in May. Other stores will offer the DRM-free catalog at dates thereafter.

The move represents a major shift, though several asterisks are dangling. The tracks themselves are being branded as "premium downloads," and will carry an elevated price tag above "standard," DRM-protected tracks. Instead of a standard, 99 cent, 79 pence, or 99 euro price tag, the premium tracks will be priced at $1.29, 0.99 pence, or €1.29. Both premium and standard tracks will sit alongside one another, and consumers will have the ability to upgrade their standard versions by simply paying the difference. That approach breaks an iTunes commitment to uniform pricing and format, and conflicts with earlier philosophies expressed by Jobs. But during the unveiling, Jobs noted that the offering means greater choice, and a more fine-tuned offering. "We think our customers are really going to appreciate this," Steve Jobs said. "iTunes will continue to offer its current catalog at the same price, alongside the DRM-free, higher quality versions." Jobs also disclosed that the iTunes Store has now sold more than 2.5 billion tracks.

EMI puts non-DRM talks on hold - demand large advance payments

After so much anticipation on this, the talks seem to have ended, reports Bloomberg. The story says talks aimed at removing copyright protection from songs didn’t go anywhere because they couldn’t agree on the size of an advance payment.
EMI demanded an upfront payment to compensate for its risk in releasing the music sans DRM, but the retailers countered with a lower offer, which EMI rejected, and negotiations with the likes of Microsoft, Apple, RealNetworks, Yahoo and Amazon.com are now on hold. The upfront demanded by EMI would come on top of the per-song charge that retailers pay...the new fee would make it less profitable for retailers unless they raise prices, these companies argued.

Apple wasn’t initially involved in the talks with EMI and was added after the famous Jobs letter... again goes to prove the power of blogs!

Jobs command, and EMI obey?

From TimesOnline:

EMI may end digital copy protection

EMI is considering whether to abandon copy protection for digital music, in a move that would set the British company dramatically apart from three principal rivals.

The British group behind Norah Jones and Robbie Williams has sounded out online music retailers about switching to the MP3 format, abandoning the proprietary digital rights management technology developed by Apple.

However, industry insiders believed that EMI was getting cold feet, because the plan could lead to a precipitate drop in its already flagging revenues. The decision would leave its entire catalogue without any protection in the digital era.

This week, Steve Jobs, the chief executive of Apple, to the music industry, in which he suggested that the majors drop their demand for copy protection, to ensure that songs sold from iTunes can be copied on to any digital music player.

However, EMI’s thinking is at odds with its competitors, who believe that Apple should instead try to license its copy protection software to permit interoperability with other digital music players — a stance that Mr Jobs rejects, arguing that the security technology may leak.

Edgar Bronfman, Warner Music’s chief executive, hit out at Jobs on Thursday, saying that abandoning copy protection was “without logic or merit” in words that found private support at market leader Universal. They hope to maintain the pressure on Apple, at a time when the hardware company is coming under increasing pressure from European governments.

All the music majors have tried to release some MP3 downloads, with EMI releasing songs from Lily Allen and Norah Jones, which it said “went down well with fans”. However, it is not clear that many people opted to pay for the songs, and other music groups question whether there is a viable business at this stage.

It is not certain that Apple will be able to open up its Fair-play digital rights management technology, as there is speculation that the company does not have all the patent rights to the software. In 2004, Microsoft paid InterTrust, a digital rights management software company, $440 million (£255 million) to license its technology. It is possible that if Apple made clear what technology it was using, a similar issue would arise.