Amazon to sell digital music free of copy curbs

NEW YORK Wed May 16, 2007 11:43am EDT

A worker loads a shipment of outgoing boxes at the Amazon.com warehouse facility in New Castle, Delaware, November 24, 2006. Amazon.com Inc. said on Wednesday the company will launch a digital music store later in 2007 with millions of songs, free of copy protection technology that limits where consumers can play their music. REUTERS/Tim Shaffer

A worker loads a shipment of outgoing boxes at the Amazon.com warehouse facility in New Castle, Delaware, November 24, 2006. Amazon.com Inc. said on Wednesday the company will launch a digital music store later in 2007 with millions of songs, free of copy protection technology that limits where consumers can play their music.

Credit: Reuters/Tim Shaffer

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NEW YORK (Reuters) - Amazon.com Inc. said on Wednesday the company will launch a digital music store later in 2007 with millions of songs, free of copy protection technology that limits where consumers can play their music.

The Seattle-based company said music company EMI Group Plc, home to artists ranging from Coldplay to Norah Jones to Joss Stone to Pink Floyd, has licensed its digital catalog to Amazon, the second such deal in a month.

Amazon, the world's top online retailer of music on compact discs, is poised to move into the online download market now dominated by Apple Inc.'s iTunes store.

With all music companies struggling from a drop in the sale of physical albums, EMI, had announced its first deal with Apple and the iTunes online music store in April. Also on Wednesday, EMI announced similar deals with VirginMega in France and with various online retailers across Scandinavia.

"Our MP3-only strategy means all the music that customers buy on Amazon is always DRM-free and plays on any device," Jeff Bezos, Amazon founder and chief executive, said in a statement.

Digital Rights Management, or DRM, has been demanded by the music industry to rein in piracy by preventing users from making multiple copies; but its critics say it restricts consumers and therefore hinders the growth of legal music uses.

Earlier this year, Steve Jobs, Apple's co-founder and chief executive, called on the world's four major record companies, including EMI, to start selling songs online without DRM copy-protection software. He said he saw no benefit for the record companies in selling more than 90 percent of their music without DRM on compact discs, while selling the remaining small percentage of music online encumbered with DRM.

Last month, EMI said it would make its music available online without anti-piracy measures, becoming the first major music group to take the risk in a bid to grow digital sales.

Warner Music Group Corp. has said it sees no logic to dropping DRM but is still testing music without it, while Vivendi's Universal Music has said it, too, is still testing tracks without DRM.

Amazon said its music store will include 12,000 music labels but the retailer is only disclosing the partnership with EMI initially. The company declined to comment on whether other major music labels would be participating in the store.

"We anticipate that there will be more (labels) by the time we launch," Bill Carr, Amazon.com's vice president of digital media, said in a phone interview.

Amazon's copy-protection-free MP3s will allow customers to play their music on virtually any of their personal devices including Apple's iPod music players and Microsoft Corp.'s Zune music players.

ITunes said its deal with EMI will charge a higher price than 99 cents, the standard price of a copy-protected song on iTunes. Copy-protection free music will cost $1.29, 1.29 euros or 99 pence for every track of EMI's catalogue available online in a higher-quality format without DRM, it had said.

Carr declined to comment on whether Amazon planned to charge a similar premium for copy protection-free versions of songs, saying that pricing per song or per album is yet to be determined.

Amazon declined to name a specific launch date, but when asked whether the store would be in operation ahead of the year-end shopping season. "It is reasonable to assume that that would be true," Carr said.

EMI's deal with Amazon covers its entire digital catalog. The most high profile exception is The Beatles, which has traditionally refused to allow online sales of its music by EMI, the band's long-time distributor. On Monday, EMI said it had agreed with Paul McCartney to release his entire solo catalog in both digital and physical formats.

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