New software promises to unlock iPod, iTunes

When Stanford partnered with Yahoo to offer students a free subscription to Yahoo Music Unlimited, Steier--like most other people he knew--didn't bother to check it out because his iPod won't let him play songs bought from other online music stores.

"I don't know anybody who used it," Steier said. "I don't even remember anyone who considered using it."

The issue is the same for many music fans because Apple makes content bought from its iTunes online music store available only for its own products, while songs purchased from other online stores typically do not work on the market-dominating iPods.

But this could soon change--because of a 22-year-old hacker who, as a teen, cracked the encryption on DVDs and now has developed a system compatible with Apple's FairPlay copyright technology that allows iTunes music to play on other devices and gives iPod users access to other music stores.

"He imitated Apple's system; he didn't remove any copyright protections," said Monique Farantzos, whose DoubleTwist Ventures plans to license the code to businesses. "He made a system that behaves in a similar way."

Jon Lech Johansen has essentially created software that, in a way, tricks iTunes into thinking a competing device with the DoubleTwist code is an iPod, said Farantzos, who predicted it could be available to consumers as soon as early 2007.

"What this means in practice is that competing (download) stores would be able to make their encrypted content compatible with the iPod, she said. "Hardware devices that have this code embedded could play iTunes content."

This could be music to the ears of consumers and good news for Apple rivals looking to cut into the company's enormous share of the digital music market. In the U.S., iTunes commands an 88 percent share of legal song downloads, and iPods soak up some 75 percent of the U.S. market for digital music players.

In practical terms, it means competing music stores like Napster and makers of rival devices such as Microsoft--which introduced its Zune player earlier this week--potentially could license the software to lure consumers who still want a piece of Apple, Farantzos said.

"Interoperability, including our solution, is not a permanent cure; it simply treats symptoms, much like a painkiller relieves pain," she said.

Farantzos, who sought out Johansen after reading a profile about him, said the software whiz was not available to speak as DoubleTwist is seeking prospective buyers for the technology. The company has recently relocated to Johansen's native Norway from San Francisco.

She also declined to go into specifics about how the hacker known as DVD Jon--who now works at DoubleTwist--cracked Apple's code. But Farantzos sees no legal complication arising from the technology she said does not remove any copyright protection.

More importantly, Apple would also find it difficult to update its software to block DoubleTwist as the company did when RealNetworks offered songs for download that worked with iPods, she added.

"We followed a different strategy than RealNetworks. We don't believe it is practical for Apple to block this."

An Apple representative declined to comment on the DoubleTwist technology.

The latest attempt to open up the digital music world comes as big players like Microsoft and RealNetworks are looking to chip away at Apple this holiday season with two new offerings that tie together devices and music download services--locking in consumers the same way as Apple does.

RealNetworks--in much the same way iPods work with iTunes--is partnering with SanDisk to offer its subscription service hand-in-hand with a new line of SanDisk Sansa digital music players priced from $139.99 to $249.99.

Microsoft's new 30-gigabyte Zune player retails for $249.99.

With a growing number of choices, the idea of effortlessly shuffling content between different devices is hugely appealing to iPod owner Larry Sharifdeen, who said he would buy only the Zune if he could play the videos on it he bought from iTunes.

"iTunes is really good, but they don't have everything I want to put on my machine," the 24-year-old CompUSA worker said. "I'm frustrated because I'm kind of locked in."