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DRM-Free eMusic Comes to AT&T Mobile

  Venture Business News  -   POSTED: 2007/07/31 08:27

In a big win for independent labels, AT&T Mobile Music is offering nearly all of eMusic's 2.7 million digital tracks on compatible AT&T handsets. In addition to eMusic being notable for focusing exclusively on independent labels, eMusic's distinction over the last few years has been that it does not wrap its music in digital rights management (DRM).

In its first deal with a mobile network, eMusic announced on Tuesday that it will sell its independent-label music through AT&T Mobile Music.

After iTunes, eMusic is the largest online music seller. Nearly all of eMusic's 2.7 million songs will be available through the AT&T service, which initially will be compatible only with the Samsung Sync (A717 or A727) and the Nokia N75 handsets.

The new service will cost $7.49 monthly for access to five songs. Subscribing to eMusic from a PC costs $9.99 monthly for 30 downloads, a lower per-song cost. But the company said that the price-per-song difference relates to the additional expense of sending the music over a mobile network.

Discovering New Music

The majority of online music services provide a wide range of titles, emphasizing artists on major recording labels, while eMusic only provides music from independent labels. These labels can be small companies that handle several artists or musicians acting as their own label.

While most independent-label songs on eMusic are by obscure musicians, some are by well-known ones, such as Johnny Cash, Ray Charles, Miles Davis, Bob Marley, and Creedence Clearwater Revival.

On Monday, eMusic released a survey showing that 84 percent of its subscribers "felt they discovered music they would not otherwise have known about," and 61 percent said they buy music from the service they would not have otherwise bought.

Creating a mechanism for discovering new music is the single biggest obstacle remaining for independent-label musicians, observed Forrester analyst James McQuivey. For major labels, he said, this fan development is usually accomplished on the radio. Independent labels "haven't been a big player" in the music-over-cellphones market so far, he said, which could change with the eMusic-AT&T deal.

No Digital Rights Management

Gartner analyst Mike McGuire noted that, in addition to being notable for expanding the pool of available music to include the little guys, eMusic's distinction over the last few years has been that it does not wrap its files in digital rights management (DRM) technology. Without DRM, songs can shared more widely among devices and friends -- and McQuivey noted that there aren't any devices more sociable than a mobile phone.

Gartner's McGuire also noted that eMusic songs delivered over AT&T will be available in the AAC file format, which provides for small file sizes. But eMusic will also make an MP3 version of a purchased song available for download to a subscriber's computer, and those songs could be transferred from a computer to a phone.

When it was originally founded in 1998 as GoodNoise, the company noted that it was the first to sell music in MP3 format. Its ownership has traded hands a few times, and eMusic is now owned by Dimensional Associates, the operating company for New York-based investment firm JDS Capital.


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