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Apple's music: Evolution, not revolution

For all the glitz surrounding the unveiling of Apple's new music service, a quick look suggests that it's a solid, but hardly revolutionary, addition to the market.

For all the glitz surrounding the unveiling Monday of Apple Computer's new music service, a quick look suggests that it's a solid, but hardly revolutionary, addition to the market.

The company has certainly put on display its experience with ease of use. Apple's new online service lets Macintosh owners buy digital downloads of songs from a vast catalog of major-label music for 99 cents apiece, with a one-click purchase process similar to Amazon.com's. And the songs, which can be burned to CDs, transferred to iPod MP3 players or moved to three different computers, have fewer restrictions on their use than do downloads from rival music services.

The integration between the one-click purchase service, Apple's iTunes music jukebox software and the iPod player goes well beyond what any other music service has done. It will genuinely make paying for music online easy, even an impulse buy, and artists and music labels see that as a big step forward.

"History proves that what works is the simplest, most intuitive thing," said recording artist Seal, who was on hand for the unveiling. "Technology is only a good idea if it helps you. As soon as it starts taking time out of your day, that technology is bad technology."

Apple spent much of Monday touting the new service's simplicity, along with the relative lack of restrictions on the music compared with those found with rival offerings--subscription services such as Pressplay, MusicNet and Listen.com's Rhapsody. CEO Steve Jobs even went so far as to say those services treated their subscribers like "criminals," by locking down music against the threat of unauthorized copying.

But what Jobs didn't note is the debt he owes to those services and to the defunct music companies that came before them, which have spent years in painful negotiations with the record companies, progressively winning more flexibility for online music distribution. Apple's service may be the least restrictive of the current services, but that's largely because other companies did the hard work of preparing the way.

Indeed, the restrictions that other services have placed on their music--songs that disappear when subscriptions run out; the inability to transfer downloaded files to MP3 players; and the whole concept of "tethered" downloads, or songs that are locked to a single PC--came not from the mysterious blindness of a generation of Net entrepreneurs, but from strict rules imposed by the record labels and music publishers.

In the course of 18 months, the music labels have slowly relaxed some of those restrictions. CD burning has emerged on all the major services. Transfer to portable devices, or at least to some models, is now possible. Apple's service marks the next step beyond what labels have granted to the previous services.

"A small subset of consumers"
Label executives privately say the Apple service is an experiment, which could be expanded if it proves successful. Apple's small market share means that the stakes are relatively low. "It's a test, with a small subset of consumers," one label executive said.

Apple essentially used two features to persuade the labels to give the company the benefit of the doubt. The ease of purchasing music was a draw. So was the light, almost invisible layer of digital rights management software that Apple built in-house and applied to the songs.

Dubbed Fairplay, the rights-management software lies on top of Apple's iTunes and QuickTime software, and performs tasks such as


Apple's new iTunes service raises
the bar for digital music, but it
won't get the company out of its
5 percent ghetto in the PC business.

counting how many computers the songs can be played on. Apple executives declined to discuss whether the software could be used for other media, such as providing protection for QuickTime-based downloads for video-on-demand services. QuickTime has previously been left out of movie-download services such as Movielink because of its lack of strong copy protection.

As Apple moves its service to the PC platform, which it said would happen later this year, the rights-management issue could set up more industry tension. Microsoft has dominated that platform with its Windows Media rights-management tools, while QuickTime has been used largely for unprotected works.

Other music services welcomed Apple's marketing muscle to the business and said they were eager to win the same rights that Jobs touted.

"I believe the rights will be offered to us before Apple moves to the PC," said Rob Reid, chairman of Listen.com, the company that offers the Rhapsody subscription service. "The labels' natural instinct will be to offer it to (their affiliate PC-based services) MusicNet and Pressplay, and we usually maintain parity with them."

Rivals weren't convinced Apple's pay-per-song model marked any improvements in music distribution. Some noted that a mix of services would likely be more successful and that Apple might ultimately be overshadowed by other companies with more music retail experience.

"A lot of people are going to fight not only to keep up with Apple, but to surpass them," said Zack Zalon, general manager of Radio Free Virgin, the online radio service of music retailer Virgin Entertainment. "They're an excellent software company, not a music retailer."