Record Industry Slowly Embraces MP3

The tune seems to be changing ever so slowly at some record labels when it comes to DRM. Both out of consumer demand and to some extent necessity, some have begun to offer digital downloads in the unprotected MP3 format.

Record labels have so far resisted offering popular artists in the format, citing piracy concerns. But with the iPod and its closed DRM ecosystem becoming ever more prevalent, industry executives are looking for ways to continue the growth of digital music.

The market does need some help - for the last two quarters digital music sales have stalled, even dropping from the first quarter of the year. This is the first time that has happened since 2003, when Apple first debuted the iTunes Music Store.

What has resulted is a debate among music executives, with those who still support using DRM butting heads with those who see MP3 as a way to expand the nascent market.

On Tuesday, Blue Note Records, a division of EMI, announced it would offer the latest single titled "Thinking About You" from jazz-pop artist Norah Jones as an unprotected MP3 download through Yahoo. In addition, Christian rock band Relient K would also offer two of its songs in MP3.

These artists are not the only popular acts who have done so; they follow several others including Panic! At The Disco, Jessica Simpson, and Jesse McCartney, which all at one time have offered MP3s to consumers.

In addition, AOL Music has been offering MP3 downloads since July of last year from both mainstream and independent artists.

MP3 downloads also solve another conundrum for music labels: allowing more of the industry to participate in the rapid success of Apple's iPod. With songs available in the open format, consumers could use other services than iTunes, possibly loosening Apple's tight grip on the industry.

Getting rid of DRM has been somewhat of an expressed goal of some executives at Yahoo. David Goldberg, vice president of the company's music unit, has argued that DRM has done nothing to help the industry, and is in fact hurting it.

He argues that consumers find DRM to be a hindrance, and those who have a large catalog of protected music are much less likely to switch to a device that does not support the technology.

Goldberg hopes to have a large catalog of MP3 content on Yahoo! Music by next year, and is talking to independent labels about offering their content on the service. Many do already in the MP3 format through eMusic, which has grown to become the second largest digital music service in the US.

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