• by Sarah Mahoney  @mahoney_sarah, April 3, 2007

In a move that shows just how threatened the recording industry is by digital music sales, EMI Group PLC says it will now sell its songs without anti-piracy software on Apple Computer Co.'s iTunes for $1.29 a pop.

Beginning in May, Apple will sell the entire EMI catalog--with the notable exception of the Beatles recordings--"DRM-free," meaning the songs won't be encumbered by the pesky digital-rights management software that limits the number of computers the song can be used on, as well as the types of devices that can use it. And for the extra 30 cents, purchasers not only get a DRM-free version but one with quicker download time and higher audio quality. Apple says the DRM-free songs will be offered at 256 kbps AAC, compared to the standard 128 kbps AAC encoding.

What's more, Apple says that it expects half of its current library, more than 5 million songs, to be available in DRM-free format by the end of the year. It will allow iTunes users to upgrade previously purchased tracks for the additional 30 cents, and even provide a one-click method for updating an entire library.

"We are going to give iTunes customers a choice--the current versions of our songs for the same 99-cent price, or new DRM-free versions of the same songs with even higher audio quality and the security of interoperability for just 30 cents more," says Steve Jobs, Apple's CEO, in a press release. "We think our customers are going to love this."

Some observers say EMI's move, which many experts are speculating will be copied soon by the other major recording companies, was inevitable. After all, they say, when consumers buy CDs, very few contain DRM software. Those can be loaded onto computers and used with no restrictions.

What's more, online music sales continue to whomp conventional music sales. Worldwide, about 10% of music is now purchased online. And recently, Nielsen SoundScan reported that for the first three months of this year, CD sales plummeted 20%.

Within hours of the Apple/EMI announcement, the Financial Times reported that a European commission is probing Apple, along with several major music companies, reportedly including EMI, Universal, Warner and Sony BMG, for antitrust violations. The commission's main concern, FT says, is that iTunes' current set-up in the European market prohibits users in one country from downloading music from a Web site intended to serve another country, and was triggered by a 2004 complaint from a British consumer organization.