by Timothy Lee
Wed, Oct 17th 2007 4:27pm
Two developments this week suggest that the recording industry is finally taking baby steps in the direction of a genuinely competitive online music market, but the progress continues to be painfully slow. First, Apple is cutting prices on DRM-free music in an apparent bid to stay competitive with Amazon's launch of a DRM-free music store last month. This is a particularly interesting development because just last year, the talk was about whether Apple would increase prices on iTunes songs. But now it's looking like further price cuts are more likely to be in the cards. Even Amazon's 89 cent price point is still a lot more expensive than eMusic, which charges around 33 cents per song. Meanwhile, Napster has unveiled a new web-based version of its music store that appears to allow people to listen to their music in their web browsers, including non-Windows PCs. The new Napster will also make it easier for you to embed your favorite music YouTube-style on other websites. Those are great new features, but it appears that the service will still require people to use Microsoft's comically-named (and increasingly irrelevant) PlaysForSure platform if they want to listen to their music on a mobile device, which is quite a handicap in an iPod-dominated market.
It's becoming increasingly clear that the recording industry shot itself in the foot when it sued MP3.com into bankruptcy in 2000. Many of the "new" features sites like Amazon and Napster are touting today—web-based access, DRM-free files—are just warmed-over versions of the functionality consumers could get from MP3.com almost a decade ago. Imagine how much more vibrant the online music market would be today if the labels had treated sites like MP3.com as a potential revenue source rather than a competitive threat.
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