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Apple's PR, EMI's Desperate Progress

4:00 PM -- Apple Inc. (Nasdaq: AAPL)'s iTunes Plus package, which includes a DRM-free, higher-quality track with a higher price, seemed like the kind of reasonable compromise to make with a major label to get over the fears of copying. It's understandable to think Apple boss Steve Jobs may have wanted some compensation for the loss of his effective lock on the digital player market as well, but Apple ain't really scared, right? Right?

Judging from yesterday's Apple-related insanity, they are pretty worried about what this will do to their stranglehold on digital music. iTunes Plus was buried beneath an avalanche of news about AppleTV and the iPhone during Jobs's interview at All Thangs D:. But it also turns out the higher quality of the DRM-free files is a non-stop source of deflection to keep consumers tied to the iPod.

By rolling out two features simultaneously, Apple halves the press coverage of DRM without any effort whatsoever. And the head-to-head comparison of the two compression options is a real softball, compared to the controversial and technical issues one might need to master to write intelligently on DRM. If people conclude that 256 kbit/s isn't that much better than 128 kbit/s, it further pushes down the appeal of the new files. Any discussion of compression automatically targets the audiophile community and companies like Music Giants, which sells digital music in a lossless (and, um, giant) format. The audiophile aspect probably turns away the average consumer more than the price.

iTunes Plus is functionally presented within the software as an all-or-nothing venture, a lifestyle change for those who just got a stereo that cost more than their car. Users are given the option to update every possible song in their library at one time (at $0.30 a track), not à la carte. Additionally, the store does not easily provide users with the option to buy either version of a song; it wants them to choose which will be their default: normal (128 kbit/s files with DRM) or plus (256 kbit/s files without DRM).

Apple's strategy is brilliant and stupid at the same time. EMI is giving it up to anyone who wants it, and Amazon may very well roll out $0.99 DRM-free downloads at whatever quality. If they push this revolutionary feature hard, it might be too late for Apple to stand up and say "me too!"

By the way, EMI finally signed a partnership with YouTube, thus making it the last of the big four to do so. This is yet another sign that EMI has lost the pissing contest between the labels as to who can embrace the digital content era the least, which of course makes it the winner when it comes to actually giving consumers what they want. Bizarro!

— A.L. Friedman, Editor at Large, Light Reading

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