Napster just launched a digital music store that is DRM free and has 6 million MP3s to download for $ 0.99. It will not have the proprietary DRM from Apple or Microsoft on it.
"Music fans have spoken and it's clear they need the convenience, ease of use and broad interoperability of the DRM-free MP3 format," said Napster CEO Chris Gorog, "and they want to be able to find both major label artists and independent music all in one place. Napster is delighted to deliver all of this and more with the world’s largest MP3 catalog."
This is bad news for Apple. Apple got strong in this business because the record labels wanted DRM on the songs and Steve Jobs gave them one, one that will only work on the iPod. Jobs argued to the labels that in order to make Apple's DRM software, FairPlay, effective, it had to be proprietary. The labels agreed and the iPod was released in October 2001 along with iTunes as the first legal digital music download store. Jobs won't license FairPlay, so all music sold on iTunes can be played only on iPods. This lack of interoperability, combined with the iPod's overwhelming dominance, gives Apple a stranglehold on the digital music marketplace. How big is this stranglehold? 22% of all music sold in 2007 was sold on iTunes.
So the empire strikes back. In July 2007, Universal said it would selectively choose which songs (or albums or artists) were sold on iTunes, rather than granting iTune blanket access to the entire catalog. (This was a major blow to Apple.) In August 2007, Universal announced the plan to offer DRM-free tracks through non-Apple retailers. Amazon and Napster are now selling DRM free music in an attempt to break the stranglehold Apple has with its proprietary system.
Is this the beginning of the end of the iPod? Time for Apple to respond. It would be nice if they licensed FairPlay. Something has to change. it will be fun to see what does.
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