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The record industry is suing college kids. Apple is cozying up to U2. Napster is making a comeback. If you can't decide where to go to download your favorite digital music, you're not alone. Finding the songs you want at the right price can be a challenge.

So what's the right price? In its first month, Apple's ITunes Music Store sold more than 3 million songs at 99 cents a pop. So it stands to reason that lots of people think 99 cents is a good price for a song. But now RealNetworks, the company whose media-streaming software is probably already on your hard drive, is selling songs for only 79 cents each through its new RealOne Rhapsody music service. Is that price reasonable?

And let's not forget the lowest price of all: free, nada, zippo. Peer-to-peer services that let you freely download music from other people's computers remain incredibly popular. According to one major software aggregation site, folks paid for 1 million songs at ITunes in one week; in the following week, 2.5 million people downloaded Kazaa's file-swapping program. It sounds like "free" still has legs--but you should also know that four college students recently settled lawsuits with the Recording Industry Association of America for swapping music files. So downloading free digital music is not without its drawbacks.

What's clear is that people like you enjoy downloading songs from the Internet. What isn't clear is the best way to do it. With the music industry hounding file swappers, is it time everyone gave up free downloads and started paying for online music? Maybe.

The ITunes Difference

Experts like Josh Bernoff at Forrester Research say that music pirates don't turn to file-swapping sites because they're looking for freebies. They go there because the services offer what online music lovers want: wide selections; reasonable pricing (gratis); and the ability to copy music files to computer hard drives, portable players, and CDs. "The reason people use free services is because they didn't find what they were looking for--not that they didn't want to pay," he says. So if people are going to start paying, sites like ITunes have to give them want they want.

Let's break down ITunes and see how it stacks up against music lovers' expectations. ITunes stands apart from most pay-to-play music services because it's free to use: You just pay 99 cents per song, or $10 for certain albums. Also, Apple's licensing terms let you do pretty much whatever you want with your downloads, whether you're burning them to a CD, saving them on your computer, or transferring them to a digital music player. Many other fee-based services have made burning CDs costly, complicated, or impossible. And many more, including RealOne Rhapsody, charge a monthly subscription fee.

What about the size of Apple's music catalog? It's nowhere near the ideal of "any song you want, anytime." Still, Apple offers more than 200,000 songs from the Big Five record labels, mixing older and newer releases with some exclusives available nowhere else. On the downside for some people, however, Apple favors more mainstream than independent music. (For an in-depth look at ITunes and some of its competitors, read PC World.com's review.)

And the price per song? Leslie Lynne Saylor, a video editor in New York, says, "Under a dollar is a fair price. A whole CD from a retail store costs at least 15 bucks." Of course, if you want to burn a CD, you need to pay for the disc and jewel case, label it yourself, and take the time to copy the music onto it. All this is factored into the cost of a CD you buy at the store.

But the biggest gotcha for ITunes is that it works with Macintosh computers only. This fact makes the site's early success all that more remarkable (and bodes well for its future) considering that less than 1 percent of U.S. homes have Macs. But for now, it means that the vast majority of online music lovers can't shop at ITunes. (Imagine Best Buy catering to 1 percent of the CD-buying public. It wouldn't work.) Apple plans a Windows version by the end of the year.

Apple's Competition

Until ITunes reaches the rest of the online world, other fee-based music services are studying Apple's success. Napster, the original file-swapping phenomenon, will be back as a paid service. Roxio, maker of Easy CD Creator software, bought Napster's remains and plans to combine Napster with a popular music subscription service called Pressplay.

Pressplay illustrates some typical pros and cons of paying for digital music. It provides an easy-to-use interface, but makes burning a large number of songs pricey. You pay a $9.95 monthly fee for unlimited streaming (listening to songs over the Internet) and downloads to your hard drive. But you can't copy any songs to a CD. Step up to a $17.95 monthly fee and you can burn a mere ten songs per month. Additional burnable songs are about a buck each.

There are other options. America Online's MusicNet has pricing and burning policies similar to Pressplay's current offerings. But like ITunes, AOL MusicNet presents a gotcha--you have to pay for an AOL membership to use the service. RealOne Rhapsody charges $9.95 per month, then 79 cents per song to burn to a CD. FullAudio's MusicNow charges $9.95 a month, then 99 cents per song to burn a CD. MusicMatch's MX service starts at $4.95 per month for unlimited streaming, but no burning to CD. If your tastes run to independent music, take a look at EMusic. This service won't give you big-label artists, but it does allow unlimited streaming and burning for $9.95 per month.

That's a lot of fees to keep track of. If all you want is the latest John Mellencamp CD, you're probably better off buying it from Amazon.com. But if you want to mix your own tunes, you need to decide how much you're willing to pay for the luxury.

On the Free Side

Why risk the ire of the music industry to traffic in free but illegal bootlegs? Mainly it's about selection. Free services like Kazaa have an almost unlimited catalog of music. Eric Garland, CEO of an online media research firm called Big Champagne, says he often finds music files from his college band listed on the free services. But he also admits that many free downloads aren't songs anyone would actually pay for. In fact, many files on those services are of poor quality or are simply junk (more on that in a moment).

Still, check this out: Every month, 21,266,128 people in the U.S. use peer-to-peer music services, says Ipsos-Insight, a market research firm. Big Champagne estimates that every month you can find 3.4 billion unique MP3 music files through Kazaa and Grokster, another popular file-swapping service. Kazaa typically reports 4.4 million users on its network at a time. With that figure, Big Champagne says that at any given time you can find 719,280,000 MP3 files through Kazaa. Now that's a big selection.

But even if you don't land in legal trouble for using Grokster or Kazaa, you should be wary of security risks like spyware, invasive ads, and viruses. For example, the recent Fizzer worm spread partly through Kazaa.

Then there's the wasted-time factor: Many files listed on the free services are junk or "spoofs"--not music at all, but voice clips that discourage free downloading. If you go looking for a new Madonna track right now, you're likely to find a clip of Madonna using salty terms to say you're stealing music. What's more, the RIAA recently began sending instant messages to Grokster and Kazaa users telling them they're illegally sharing copyrighted songs.

"The RIAA warnings had a lot of people laughing really hard. But the case with the college kids being sued makes people think twice," says Bernoff. Those students ended up paying thousands of dollars each to settle the lawsuits.

Granted, the chances that you'll end up in the cross-hairs of the music industry seem slim right now. But do you want to risk it? Go ahead and try sites like ITunes and RealOne Rhapsody. Their prices are in the right ballpark; and the more people use them, the more songs they'll offer. Hey, they may not be perfect, but they are the future of digital music.

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