DRM-free movement snowballs; watch those song prices

Amazon said Wednesday that it will launch a digital music store "later this year" that will feature DRM-free tunes.

The online retailer said it will offer millions of songs from more than 12,000 labels. EMI's music catalog, which went DRM-free with Apple, will be included in Amazon's store.

The official line from Amazon CEO Jeff Bezos:

"Our MP3-only strategy means all the music that customers buy on Amazon is always DRM-free and plays on any device. We're excited to have EMI joining us in this effort and look forward to offering our customers MP3s from amazing artists like Coldplay, Norah Jones and Joss Stone."

Now let's make a few leaps. What's most interesting about the Amazon announcement is that it may preview the landscape once everyone offers DRM-free MP3s. Music stores will be everywhere and music will become a commodity.

How this shakes out remains to be seen, but commodity goods typically see a pricing race to the bottom. The wild-card is the music labels and whether they can control pricing. For instance, Apple charges more for DRM-free music (it tosses in better song quality), but that model may not hold up as more stores appear. If I can get a DRM-free song for 99 cents why would I pay more. After all, it'll all play on the iPod.

For now everyone is in the same bed--labels and store owners (Apple, Amazon, Yahoo et al)--but what happens in a world where everything is DRM-free? It's possible EMI could find itself with growing market share since it ditched DRM. It would only make sense for rivals to cut pricing to keep share.

The music industry fought tooth and nail to maintain the industry's economic model. But the road may lead to free anyway.