Look out iTunes: Amazon and Warner Music cut their own deal


Today Amazon announced an agreement with Warner Music Group to distribute music through the Amazon.com digital music store. The key feature to these downloads will be the absence of digital rights management (DRM), meaning that customers who download these songs will not be restricted in their use. They will be able to play them with any music player or computer, unlike Apple Inc's limited format.

Now, more than 2.9 million titles will be available at Amazon, including those by many well-known artists. Warner Music is added to the line-up, which already included Universal Music Group, EMI Music Group, and thousands of independent labels.

Songs on Amazon cost $0.89 to $0.99, with full albums priced at $5.99 to $9.99. These prices are somewhat comparable to Apple's iTunes, whose individual songs sell for $0.99, with album prices varying.

While some consumers and analysts feel that DRM is necessary to protect the financial interests of the artists and record companies, others think that the lack of DRM will actually benefit them more in the long run. By making the music more accessible and transferable, some people think that consumers will be more likely to buy more music. (I agree!)

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.