Apple cuts price on copy-free digital songs

NEW YORK Tue Oct 16, 2007 6:59pm EDT

NEW YORK Oct 16 (Reuters) - Apple Inc.'s (AAPL.O) iTunes music store cut the price of digital songs it sells without copy protection to 99 cents from $1.29 on Tuesday, bringing them in line with songs that have copy protection.

ITunes started selling digital songs and albums without copy protection, known as digital rights management, in May in a service called iTunes Plus. Its first major record company partner was EMI Group, announced in April.

Apple said it is adding over 2 million tracks from independent labels in addition to EMI's digital catalog.

"ITunes Plus has been incredibly popular with our customers and now we're making it available at an even more affordable price," said an Apple spokesman.

Though Apple founder Steve Jobs had hoped iTunes would lead the way in encouraging major music groups to drop DRM, he has failed to secure a contract with Universal Music Group, the largest music label.

Universal Music Group instead said in August it will partner with major retailers like Wal-Mart Stores Inc (WMT.N) and Amazon.com Inc (AMZN.O) to trial selling songs without DRM. Wal-Mart sells DRM-free songs for 94 cents each.

Executives at Universal are concerned that Apple's dominance in the digital music, with 70 percent market share, is not helping the fledgling sector grow.

Digital rights management prevents users from illegally distributing music to others. But industry critics say it has also hampered the growth of digital music sales as it can restrict users to playing the songs they buy to certain devices.

For example DRM-protected songs bought on iTunes can only be played on a user's personal computer or the iPod, but not on other players.

Some music executives are hoping that by selling music without DRM it will boost sales across the board. (Reporting by Yinka Adegoke)

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