iTunes: Not Going DRM-Free Yet (AAPL)

Sony-BMG's decision to start selling digital music without copy restrictions set off a wave of "DRM is Dead!" stories. And it looks like big music -- though not Hollywood -- will indeed stop selling downloads without DRM, eventually. But not yet.

Specifically, as we've noted before, the labels still like using DRM -- as a tool to help beat on Apple and its near-monopoly on digital music sales. So far only EMI is selling DRM-free music on AAPL's iTunes, while the other three big labels are making a point of not selling DRM-free music on iTunes, and instead supporting Amazon's new music store. That may continue for quite a bit, the NYT notes today.

A senior executive at another record company, who requested anonymity out of concern about irritating Mr. Jobs, said he was prepared to keep copy restrictions on his label’s songs on iTunes for six months to a year while Amazon establishes itself.

That said, we still expect to see almost all music sold without DRM by 2009. And we still expect that not to make much difference for digital sales. While we have yet to see data on either EMI or Universal Music Group's DRM-free track sales to date, we've long agreed with the sentiment expressed by NPD analyst Russ Crupnick: As far as consumer awareness goes, DRM should stand for "doesn't really matter."