The New York Times’ account of the behind-the-scenes negotiations that led to iTunes going totally DRM-free, getting downloads over 3G and variable pricing is fascinating for several reasons. One, it reveals that while Jobs said he was taking the holidays off to spend time with his family instead of preparing for Macworld, he was plenty busy making record executives cry. The Christmas Eve call, the Times says, “ricocheted around the music industry.”

Two, it reveals that Apple and iTunes have reached a tipping point since becoming the number one music retailer in the world: iTunes is now a more powerful institution than the record labels themselves. Just 18 months ago, Universal was flexing its muscles to show that iTunes still depended on the record instury, not the other way around. But in this round of negotiations, “several high-level music executives” told the Times (anonymously, of course) that “they operated in fear of Apple’s removing a label’s products from the iTunes store over a disagreement, even though that has never happened. The labels do not have much leverage in negotiating with Apple.”

Sony was the lone dissenter, which resulted in the “particularly tense” Christmas Eve chat. And well, we all know how it turned out. [NYT]

That’s right. They won’t let you choose which stuff you can upgrade. This has been reported already, at least by this guy—and I suppose it’s not new news given the fact that they’ve done upgrades since EMI went DRM-free a while back—but the scope is much greater now that all the labels are on board. After returning from a week of Macworld and CES to the comforts of home, the impact of this has hit me, like the baseball bat I took on the cheekbone back in 1993.

You’re snickering. Not about the baseball bat (I hope), but about the whole spending-money-on-iTunes thing. Yep, I am a recovered iTunes DRM-music-buying addict. I still pay for music, but now Amazon is the legitimate source of all my thankfully DRM-free impulse buys.

Last Tuesday’s announcement that iTunes would go DRM-free was good news in several ways: Not only might iTunes win me back as a customer, but I also would be able to upgrade the best stuff I bought over the years, so I could have it in high quality, playable not just on my Apple (TM) products, but also on Sonos or BlackBerry or any other fun music-savvy device that comes in and out of my house.

So I clicked “Upgrade To iTunes Plus” and I got a gun to my face saying “$US250 or else.”

Seriously, they want $US250—actually, they want $US250.06 but what’s a few pennies between lifelong friends?—to upgrade the 1,000+ songs I’ve bought over the years. That would mean that all those albums I paid $US9.99 for would actually cost me $US13 in the end. That’s the same amount the damn CD would have cost me in the first place, if I still bought those museum pieces. And the CD would have given me the option to rip at higher quality than 256Kbps, and would come with liner notes telling me who played that sick drum solo on Track 12, to boot.

The clincher was this: When I went to click on just the albums I really wanted to update, the “upgrade” price was… full price. WHA?? I clicked on the FAQ, and this is what I saw:

I remembered a similar bulk upgrade offer before, when it was just EMI’s content, but as you can imagine, the price they wanted for that was less scary. I must’ve paid it (probably under the influence of alcohol). I haven’t caved this time—not yet at least. I’d be faced with having to explain a $US250 iTunes charge to the wife without getting any new music, movies or music videos to show for it. She’s a cool person and all, but I wouldn’t escape that conversation without some kind of half-accusatory, half-pitying “Oh babe.”

Do you see what you’re doing to me and to my family, iTunes? I guess you do: You are only the monster the music industry has made you for screwing with their decades-long con. Amazon definitely got the better deal, most likely for appearing harmless—no doubt their inevitable contract renegotiation will be a bitch and a half.

And to those of you out there who steal music instead of buying it, well, frankly, I can totally see why. [iTunes What's New]

Besides the fact it’s nothing new (and iTunes ain’t the only place that does it), it shouldn’t really be an issue. The legit point of DRM-free tracks is that you can use them on any device you want without any retarded roadblocks, and easily share it with some friends, and it’s not like you care if they’ve got your email address right? Right? [Crave via Slashdot]

Well, despite the fact that you can purchase the same tracks for the same price without DRM, if you’ve already purchased a DRM-encoded version, you’ll need to pay Apple 50 cents per track to remove the restrictions, or $1.00 per track for music videos. And considering that Apple were happily announcing that they’d sold 6 billion songs on iTunes since the music store kicked off in 2003, that’s one hell of a bonus fee to be paying.

Moreover, what of the 2 million tracks that won’t be DRM-free until April? Will you need to pay the bonus 50 cent charge again then? Our advice: if you do purchase from iTunes (and now it’s mostly DRM-free, there’s little reason not to), make sure you’re getting the DRM-free version of the track before you click OK.

[Macworld coverage on Giz]

The new prices will come on April 1st. iTunes Plus will initially get 8 million songs at 256kbps, with two million more coming at the end of the quarter. When the process is done, the entire iTunes Store catalog will be available DRM free.

The iPhone will finally get songs purchasing over the 3G network, rather than being limited to Wi-Fi hotspots. The 3G downloads start today. Good news for compulsive Shazam users like me. [Macworld 2009 Coverage]

Changes Coming to the iTunes Store

- All Songs DRM-Free

- Users Can Download Songs Directly Onto iPhone 3G Over Their 3G Network for the Same Price

- In April 2009, Songs on iTunes Will be Available at Three Price Points

SAN FRANCISCO, Jan. 6 /PRNewswire-FirstCall/ — Apple(R) today announced several changes to the iTunes(R) Store (http://www.itunes.com). Beginning today, all four major music labels — Universal Music Group, Sony BMG, Warner Music Group and EMI, along with thousands of independent labels, are now offering their music in iTunes Plus, Apple’s DRM-free format with higher-quality 256 kbps AAC encoding for audio quality virtually indistinguishable from the original recordings. iTunes customers can also choose to download their favourite songs from the world’s largest music catalog directly onto their iPhone(TM) 3G over their 3G network just as they do with Wi-Fi today, for the same price as downloading to their computer. And beginning in April, based on what the music labels charge Apple, songs on iTunes will be available at one of three price points: 69 cents, 99 cents and $1.29, with most albums still priced at $9.99.

“We are thrilled to be able to offer our iTunes customers DRM-free iTunes Plus songs in high quality audio and our iPhone 3G customers the ability to download music from iTunes anytime, anywhere over their 3G network at the same price as downloading to your computer or via Wi-Fi,” said Steve Jobs, Apple’s CEO. “And in April, based on what the music labels charge Apple, songs on iTunes will be available at one of three price points — 69 cents, 99 cents and $1.29 — with many more songs priced at 69 cents than $1.29.”

iTunes offers customers a simple, one-click option to easily upgrade their entire library of previously purchased songs to the higher quality DRM-free iTunes Plus format for just 30 cents per song or 30 percent of the album price. The iTunes Store will begin offering eight million of its 10 million songs in Apple’s DRM-free format, iTunes Plus, today with the remaining two million songs offered in iTunes Plus by the end of March.

iPhone 3G users can now preview and purchase the entire iTunes Store music catalog on their iPhone 3G over their 3G network, just as they do with Wi-Fi today, for the same price and in the same high quality format. Songs purchased on an iPhone will automatically sync to a user’s computer the next time they sync their iPhone.

The iTunes Store is the world’s most popular online music, TV and movie store with a catalog of over 10 million songs, over 30,000 TV episodes and over 2,500 films including over 600 in stunning high definition video. With Apple’s legendary ease of use, pioneering features such as iTunes Movie Rentals, integrated podcasting support, the ability to turn previously purchased tracks into complete albums at a reduced price, and seamless integration with iPod(R) and iPhone, the iTunes Store is the best way for Mac(R) and PC users to legally discover, purchase and download music and video online.

Considering practically every other music store (including BigPond) has DRM-free music downloads, it’s about time that Apple joined the party. Although apparently not all songs will be DRM-free – and there was no indication of how DRM will be stripped from previously purchased music.

In any case, we’ll probably know for certain tomorrow after Schiller gives his maiden and final Macworld Keynote.

[CNet]

AppleInsider cites a Dec. 3 story from the French publication Electron Libre that says iTunes will remove DRM from Sony, Universal and Warner tracks on December 9th. The story doesn’t say what percentage of tracks from the major labels, or what the cost bump for the new tracks might be, if any. In fact, check out this rather ungraceful machine translation of the French story for yourself:

…The signals are clear today. iTunes should offer catalogs of three majors Universal Music, SonyBMG Music and Waner rid of technological protection measures next Tuesday, Dec. 9. The transition to DRM Free should be at a global level…

With that opener, it almost reads like a fortune. I for one hope this fortune comes true. [Electron Libre via AppleInsider]

[BigPond Music via Lifehacker]

They’re also announcing the addition of Universal Music Group and Sony BMG to the MP3 DRM-less format (DRM-less as long as you buy the music), the last bits to complete their “majors” MP3 collection. We think the deal is hotness as long as you’re OK with the fact that you’re renting, not buying; well, you’re now “buying” those ten tracks a month, in essence. [Zune]