RealNetworks Could Be Real Challenger To iTunes

A music service run by MTV and the creators of RealPlayer is launching a digital download store that could be the most credible challenger yet to Apple's iTunes store.

Rhapsody America offers five million songs in MP3 format and mirrors the iTunes pricing structure of 99c per track and $9.99 per album.

But unlike iTunes, the songs are available without the shackles of Digital Rights Management. That's a restriction designed to fight piracy by limiting or preventing users from copying the file to multiple computers or handheld devices.

Rhapsody has signed deals with all four major record labels (Sony, EMI, Universal, and Warner) to offer DRM-free music. Despite owner Steve Jobs' public requests, currently only EMI allows the iTunes store to do this. There's been some speculation that this imbalance is a deliberate attempt by record labels to strengthen their bargaining position after early fears that Apple was becoming too powerful in the digital download market.

The other main selling point of Rhapsody is that the store will allow users to listen to entire songs before buying, as opposed to the 30 second clips available on the iTunes store. Users will be allowed to preview up to 25 songs in this way each month, after which they'll be limited to clips. (Source: latimes.com)

The store launch coincides with Rhapsody's announcement of a partnership with Verizon Wireless to allow cell phone subscribers better synchronization with the existing V CAST service. Customers who buy music on their phones (delivered over the air to their handsets) will automatically get a free copy of the same track on their PC. (Source: vzw.com)

Rhapsody is hardly the first rival to iTunes, but it's arguably the first legal download site to offer a similarly wide range of music on a pay-per-track basis. However, with the pricing identical, they'll have to rely on the promise of DRM-free tracks (which many, if not most users don't really understand) to overcome the established name recognition of iTunes.