Report: Apple’s iTunes Store to go DRM-free, offer labels more flexible pricing

“Apple has cut deals that will finally enable iTunes to offer songs free of copy protection software from the three largest music labels, according to two sources close to the negotiations. In exchange, Apple has agreed to become more flexible on pricing, the sources said,” Greg Sandoval reports for CNET.

“Under the terms of the deal, song prices will be broken down into three categories–older songs from the catalog, midline songs (newer songs that aren’t big hits), and current hits–said one of the sources,” Sandoval reports.

With EMI already long aboard Apple’s DRM-free train, “these new deals will expand iTunes’ DRM-free library to include songs from the other three major labels (Sony BMG, Universal, and Warner Music),” Sandoval reports. “The good news is that the price of catalog music is falling to 79 cents per song. The labels will get an opportunity to price some hit songs for more than 99 cents but eventually those songs will drop to 79 cents, according to one source. Before iTunes users get too worked up, they should remember that song prices at iTunes haven’t increased in five years. According to the Consumer Price Index, a 99-cent song in 2002 would be worth $1.17 today.”

“Apple and the music labels have also apparently come to terms on over-the-air downloads, according to a source. That would allow iPhone owners to download songs to their mobile devices via cell networks,” Sandoval reports.

More info in the full article here.

[Thanks to MacDailyNews Reader “James W.” for the heads up.]

35 Comments

  1. I always liked the simplicity of iTunes. When you went to buy a song, you knew that it was 99 cents, because they were all 99 cents, and that it was always 99 cents. Once they start variable pricing, you won’t know until you find that specific song what the price is, and you won’t know if you could get (or have gotten) a better deal by buying at a different time, either earlier or later. It introduces an element of uncertainty into the buying process that I personally don’t like. Your mileage may vary.

    Also, I find it hard to believe that this will benefit consumers by lowering prices. I’m sure the labels see this as a method to extract more money from consumers. We’ll see how many songs are lower than 99 cents, and how long it takes them to get there, as opposed to songs that are above 99 cents.

  2. I’m fed up with the DRM mess.
    1 iPhone + 2 iPods + 1 girlfriend + 3 kids x 5 macs + 3 accounts = HELL!

    Syncopation helps, and Simplicity is cool, but it sucks that I am not a thief yet treated like one.

  3. I’m not interested until they offer lossless compression. Why settle for less than I can get on a CD? And no, I don’t use those crummy Apple earphones — either kind.

    Once Apple offers lossless compression I will only buy online. Until then, no sale.

  4. First off, Elfquest fan?

    Second…I don’t think you should hold your breath for Lossless OTA – or over the wired net either…the server and bandwidth requirements would – well, quite possibly slow the entire internet down. It would certainly send a bunch of ISP’s – that ALREADY wanna charge on some type of per/GB/month model – over the edge and into our wallets…

  5. That’s fine, I suppose. Most of the songs I buy are older songs and genres such as Jazz, so if this is true, the cost for me will be generally lower going forward.

    So if this is true, Apple has made “concessions” that allow the iTunes Store to generally sell songs for even less than 99 cents (on average), which is probably what Apple wanted because the iTunes Store is really a value-added service for iPod owners. In exchange, the record labels give Apple everything Apple wanted, including the removal of DRM. Apple will be the hero for removing DRM from music forever, even though they actually benefitted more from having DRM in place for all of these years.

    The executives in the music industry have been so thoroughly manipulated by Apple that they probably think they won these negotiation. In fact, this change will make Apple even more dominant, and make it harder for other online digital music vendors (such as Amazon) to compete and make money. Unlike Apple, they make money from selling the music, not from selling the iPods that hold the music.

  6. Lossless is not going to happen. Anyone waiting for it may as well keep buying SACD or DVD-audio. Ordinary CDs are practically indistinguishable from iTunes plus, especially on contemporary music, anyway.

    For the rest of the world, we can now go back to our normal lives, and recording industry will now have a chance to live.

  7. Some 256 AAC is pretty close to CD quality especially for contemporary music, but we can have this debate forever.

    My question is: Does the taking away of DRM automatically also mean that all of the music will become 256 AAC?

    That is not mentioned at all in the article. I could “live” with 256 although Apple Lossless would be much, much preferable.

  8. Apple seem to have plenty of customers using the iTunes Store, even with the “boycott” from the silly audio snobs. ” width=”19″ height=”19″ alt=”smile” style=”border:0;” />

  9. The average–and even above-average–music fan won’t really care about the difference. And before you start getting all high and mighty about *who* can tell the difference, you may want to (ironically) learn to spell the word “HEAR” correctly.

    Fail.

  10. If this rumor is true, then it had better be 256 AAC across the board at the iTunes Store. I can’t distinguish much difference between 256 and lossless, but I sure as hell can recognize the tinny sound of 128 AAC.

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