Apple, EMI Dump Copy Protection
Breaking from the rest of the recording industry, EMI Group said Monday it
will begin selling songs online that are free of copy-protection technology
through Apple Inc.'s iTunes Store. The deal, however, doesn't include music
from the label's biggest act, The Beatles.
ITunes customers will soon be able to buy songs by the Rolling Stones, Norah
Jones, Coldplay and other top-selling artists for $1.29, or 30 cents more than
the copy-protected version. The premium tunes also will be offered in a higher
quality than the 99-cent tracks.
EMI Chief Executive Eric Nicoli said The Beatles music catalog is excluded
from the deal, but said the company was "working on it." He declined
to set a time frame for negotiations over the catalog.
The announcement followed calls by Apple Chief Executive Steve Jobs earlier
this year for the world's four major record companies, including EMI Group PLC,
to start selling songs online without copy-protection software.
The technology, known as digital rights management, or DRM, is designed to
combat piracy by preventing unauthorized copying or sharing, but it also can
be a consumer headache. Some music players, for instance, support one type of
DRM software but not others.
The DRM used by Apple does not work with competing services or devices, meaning
that consumers can only download songs from iTunes to work on their computers
or iPod music players. The lock between the download services and players has
drawn criticism from European industry regulators, who argue that it limits
"Doing the right thing for the customer going forward is to tear down
the walls that impede interoperability," Jobs told a London news conference.
He has previously argued there was little benefit to record companies selling
more than 90 percent of their music without DRM on compact discs, then selling
the remaining percentage online with DRM.
Some analysts suggest that lifting the software restrictions could boost sales
of online music, which currently account for around 10 percent of global music
Jobs said that he planned to offer around half of all music in the iTunes store
under the premium package by the end of the year, but declined to say whether
the company was in discussions with other leading record companies.
"Consumers tell us overwhelmingly that they would be prepared to pay a
higher price for digital music that they could use on any player," Nicoli
said. "It is key to unlocking and energizing the digital music business."
The iTunes music store will begin offering EMI's entire catalog -- apart from
The Beatles -- without DRM software starting next month, he said.
EMI has acted as the distributor for The Beatles since the early 1960s, but
The Beatles' music holding company, Apple Corps Ltd., has so far declined to
allow the Fab Four's music on any Internet music services, including iTunes.
The situation was exacerbated by a long-running trademark dispute between Apple
Inc. and Apple Corps. That legal feud was resolved in February when the two
companies agreed on joint use of the apple logo and name, a deal many saw as
paving the way for an agreement for online access to the Fab Four's songs.
Apple Corps was founded by the Beatles in 1968 and is still owned by Paul McCartney,
Ringo Starr, the widow of John Lennon and the estate of George Harrison.
Shares of Apple Inc. jumped 72 cents, to $93.63, in Monday trading on the Nasdaq