03.15.2007 08:00 AM
EMI to continue using DRM with music downloads

The EMI Group has reportedly called off talks with digital music download services about selling its music without copy protection.

There had been speculation in recent weeks that EMI would become the first of the "Big Four" music companies to sell music without digital rights management (DRM) protections. A report by Bloomberg News, however, said an upfront payment could not be reached and the talks have stalled.

Bloomberg reported that EMI had sought an agreement that included a large upfront payment to compensate them for illegal copying. The online retailers offered less and a compromise could not be reached. The talks included Apple, Microsoft, RealNetworks, Yahoo! and Amazon.com.

Matters were further complicated because Warner Music is interested in buying EMI, and Warner's CEO Edgar Bronfman opposes music sold without the traditional protection mechanisms.

Bloomberg said EMI's delay might put off an industrywide shift because music companies are wary of being the first to take the step.

EMI last week cut its revenue and profit forecasts for the second time this year as music sales slump in the U.S.

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