EMI Music has agreed to make all its current digital repertoire available free of digital rights management (DRM) restrictions with immediate effect.

The move is groundbreaking for a major multinational music company, as all four majors had previously insisted that all their digitally distributed music be DRM-protected.

EMI Group CEO Eric Nicoli made the announcement at a press conference at the major's London headquarters, flanked by Apple CEO Steve Jobs. EMI's new "higher quality" DRM-free music will be available on Apple's iTunes Music Store for $1.29 a track in the United States from next month.

The new premium versions of EMI's digital songs will be available alongside the existing DRM-protected music already offered via iTunes. EMI will make all of their current online catalogue available to all online retailers worldwide.

Music from the launch artist for the project, Parlophone/EMI-act the Good, the Bad and the Queen -- who performed two songs at the press conference -- will be available DRM-free from some online retailers from today.

Jobs called the EMI move the "next big step forward in the digital music revolution" and publicly appealed to "all other major and independent labels" to follow EMI's lead. He declined to reveal details of negotiations with other labels, but predicted that half of iTunes' catalogue could be offered DRM-free by the end of 2007.

Nicoli said the move reflected EMI's philosophy and strategy of being "committed to embracing change and to developing products and services that consumers really want to buy.''

He added that EMI's attitude to its digital music offer was: "It needs to be good value for money, needs to offer choice and needs to be simple to understand and easy to use."

Nicoli emphasized that the move "did not diminish in any way our commitment to fighting piracy," but said EMI's research had indicated "overwhelmingly" that consumers would be prepared "to pay a higher price for a digital music file that they could use on any player." The higher-quality non-DRM tracks out-sold the standard version "10 to 1" in trials.

Industry observers and consumer groups in Europe have argued that digital music sales would accelerate only if Apple dropped its proprietary DRM system which locks iTunes customers into playing their music on only Apple's iPod digital players.

Apple digitizes its stock of tracks in the AAC format using its Fairplay DRM software, which prevents pirates from making unauthorized copies but also stops consumers from making unlimited copies for personal use.

Conversely, digital music protected by other DRM software will not play on the iPod.

Now, the superior quality tracks will be encoded in AAC, which has the sound quality of the original master recording, but will not be copyright protected in Fairplay.

In February, Apple founder/CEO Steve Jobs publicly blamed the majors' insistence on using DRM for stalling improvement in digital sales. And shortly after, Billboard also discovered that EMI was going to support the use of the MP3 format or DRM-free solutions (Billboard.biz Feb. 9, 2007).

Moreover, EMI had already started testing the DRM-free waters by releasing recordings by Norah Jones, Relient K and Lily Allen in the unprotected MP3 format during tests at the end of 2006.

Although EMI also controls the much-coveted Beatles catalog, it will not be included in the deal. Nicoli confirmed that negotiations over the digital release of the Fab Four's catalog remain ongoing.

On iTunes, DRM-free recordings by EMI acts will cost $1.29 per track in the United States, £0.99 in the United Kingdom and €1.29 on continental Europe. For standard-sound DRM-secured tracks, iTunes will continue to charge $0.99, €0.99 and £0.79 respectively.

iTunes albums will now be sold in the higher quality DRM-free format only at its standard price, as will all EMI music videos.

And for 20 pence ($0.30/€0.30) per track, iTunes customers will be able to convert their entire collection of already paid-for songs into the new open formats.

However, for retailers, the wholesale price for single tracks will change, while the wholesale price for albums will stay the same.

Other digital retailers opting to sell DRM-free EMI songs will be able to choose other encoding formats, such as MP3, Microsoft's WMA or the AAC version that Apple is using. But EMI will retain DRM use for other business models, such as subscription-based services, where customers pay a monthly fee for unlimited access to music; for super-distribution, which enables consumers to share music with friends; and for time-limited downloads, that are usually used for the duration of marketing campaigns.

"This is a good move on EMI's part," notes Paul Jackson, Amsterdam-based principal analyst at Forrester Research. "We have been saying that DRM restricts consumers and that is a bad thing. The move also opens up the digital download to people who don't want to pay for digital music because they can't do what they want with it. We can expect some frenzied activities among the majors in the coming months."

For ongoing DRM coverage, news and analysis visit Billboard.biz/DRM.