One potentially very big picture
So how does this all fit together? First, there's the fact that the labels are reputedly very excited about Apple's still-theoretical music service; one exec reportedly expressed a wish that Apple had announced plans for this five years ago, before the online-music fracas really got underway. Apple's iTunes and iPod have kept clear of confining copyright restrictions, and most labels do not approve of systems that leave files unprotected and freely tradable. They prefer that files be wrapped in DRM (Digital Rights Management) technology, to protect their interests. So why would a label exec condone Apple's potential service?

Perhaps the answer lies within the Listen/Real deal. Real has been the only company to develop DRM technology for the Macintosh and happens to be the same company that just secured the rights to distribute all five major music catalogs online by purchasing Listen. In addition, Real and Macintosh inked some deal long ago where the two agreed to cooperate since both were facing (and still face) stiff competition from the Microsoft behemoth.

The fact that the Listen/Real deal and Apple's music-service rumors started circulating around the same time might well be coincidence. But unless Apple has developed its own DRM scheme (as suggested by longtime Apple watcher Molly Wood), a Real acquisition or deal would be awfully tempting. It would include most popular music (good for consumers) and the means to distribute it securely (good for labels). If Apple went this route and added support for the RealAudio codec to upcoming and existing models of the iPod, consumers could, for the first time, subscribe to a seamless service that integrates musical content, worldwide distribution, and portable playback. If this sounds familiar, that's no accident; it's exactly what the SDMI (Secure Digital Music Initiative) organization--a consumer electronics/music industry hybrid--has been trying to do for years.

Maybe this time it will work.