May 17, 2007
I get to keep my trampoline.
Let me explain. In an interview with Mac Greer earlier this month, we began discussing the possibility of Amazon.com (Nasdaq: AMZN ) launching an online music service. We had been discussing heavy objects that we had ordered in the past from Amazon -- for me it was a trampoline a few years back, for Mac it was a lawn mower -- when I laid it all on the line: If Amazon didn't launch a music service before the end of the year, I would give Mac my trampoline.
Well, I didn't have to wait long. Amazon has made it official, announcing that it will launch a digital music service later this year. Unlike most existing storefronts that sell format-protected tunes -- like Apple's (Nasdaq: AAPL ) iPod-shackled iTunes downloads -- Amazon's tracks will be pure MP3 files. In other words, they'll be portable across all devices, free of any digital rights management (DRM) restrictions.
Amazon claims that it has 12,000 music labels on board, including EMI Group (OTC BB: EMIPY.PK). That isn't a surprise. EMI has already agreed to sell premium MP3 tracks, even through Apple. EMI's bold step has even inspired Yahoo! (Nasdaq: YHOO ) to predict that it will have a DRM-free store open before the holidays.
Leave it to the digital heavies to rain on Amazon's parade. Reports that the leading e-tailer was working on an MP3 store have been swirling about since last year. It was considered a rebellious move at the time -- a gutsy splash for a company late to the digital music game -- but now, it seems as if all the hip kids are doing so these days.
So, yes, I do get to keep my trampoline. Now it's Amazon's turn to bounce.
A timeline of the untimely demise of protected music downloads:
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Longtime Fool contributor Rick Munarriz once had his band signed to Sony's Columbia Records label. It didn't exactly pan out. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. He does not own shares in any of the companies in this story. The Fool has a disclosure policy.