- The Washington Times - Monday, April 2, 2007

LONDON

EMI Group PLC yesterday announced a deal that will allow the computer company Apple Inc. to sell the record company’s songs online without copy-protection software.

Customers of Apple’s ITunes store soon will be able to play downloaded songs by the Rolling Stones, Norah Jones, Coldplay and other top-selling artists without the copying restrictions once imposed by their label.

EMI Chief Executive Eric Nicoli said the Beatles’ music catalog is excluded from the deal but 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, to start selling songs online without copy-protection software.

The software, known as digital rights management, or DRM, was designed to combat piracy by preventing unauthorized copying, but it can make downloading music difficult for consumers.

Software used by Apple does not work with competing services or devices, meaning that consumers only can download songs from ITunes to IPod music players. The linkages between the download services and players have drawn criticism from European industry regulators, who argue that they limit buyer choice.

“Doing the right thing for the customer going forward is to tear down the walls that impede interoperability,” Mr. Jobs said during a London press conference.

He 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 account for about 10 percent of global music sales.

The DRM-free versions of each single track, which also will be of a higher quality, will cost buyers 20 percent more than standard versions of tracks, a statement from Apple Inc. said.

Mr. Jobs said he planned to offer about half of all music in the ITunes store under the premium package by the end of the year, but he 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,” Mr. 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 declined so far 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; John Lennon’s widow, Yoko Ono; and the estate of George Harrison.


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