RealNetworks Puts Harmony on any Player

Saying it's bringing choice to online music services users, RealNetworks has announced software that lets songs downloaded from its own music store be played on a variety of devices, essentially breaking Apple's proprietary grip on its market-leading IPod music player.

The new software, called Harmony, will be incorporated into RealPlayer 10.5, which is scheduled to go into beta test Tuesday. Harmony will let users download songs from the RealPlayer Music Store, introduced in RealPlayer 10, into more than 70 music player devices, including the IPod and IPod Mini, and products from Creative Labs, Dell, Gateway, and Samsung Electronics.

Harmony is designed to support any device that uses the Apple FairPlay digital rights management technology, the Microsoft Windows Media Audio DRM, or the RealNetworks Helix DRM, according to Sean Ryan, RealNetworks' vice president of music services.

However, it's the capability to let RealPlayer Music Store tunes be played on the market-dominant IPod that is sure to arouse the most interest. Songs bought from Apple's ITunes are encrypted with the company's FairPlay DRM, which works only with the IPod, and Apple has not licensed the technology to other companies seeking compatibility with the music device.

RealNetworks did not work with Apple on Harmony, Ryan says. In fact, Apple never responded to the offer several months ago from of Rob Glaser, RealNetworks founder and CEO, to work with Apple.

Annoying Apple?

Apple's integrated music service, comprising its iTunes Music Store, its DRM, and the IPod, has made it the top online music distributor and catapulted the IPod into the leadership position in the player market, according to analysts. The company has been protective of its service so far, and its licensing agreement prohibits IPod users from reverse-engineering or otherwise attempting to "derive the source code" of its software.

But RealNetworks' Ryan says his company did not reverse-engineer Apple code.

"Reverse engineering is a misleading legal term," Ryan says. "It implies a method of looking at the software and seeing how it's built. We looked at publicly available data moving between the user and the IPod. We have very smart engineers that have been working on DRM for a long time."

Harmony will not allow songs stored on IPods to be translated and played or stored on other devices, Ryan adds.

The real value of Harmony is that it gives online music buyers freedom of choice and protects their investment in music, Ryan says.

"People are making this into an Apple story but this is really about bringing universality to the user," he says. "We're solving a problem here. We're letting users buy music and play it on their device of choice. You may have an IPod now, but what happens if you want to use another device in the future?"

Though Apple has the dominant music player now, its proprietary approach toward integrated software and hardware has reduced their market share in PCs, Ryan adds. "Apple is the belle of the ball now in online music, but we've seen where their technology strategy has led them in the past."

"They should be thrilled," that Harmony is letting iPod users buy music from a wider variety of sites, he adds of Apple.

Apple representatives contacted Monday declined to comment on the announcement.

Sweet Sounds

However, there appears to be little downside for Apple, according to Tim Deal a senior analyst with Technology Business Research. RealNetworks does not appear to offer anything that would cause IPod users to switch to other devices, he says. In any case, while IPod hardware generates close to 14 percent of Apple revenue, the ITunes Music Store generates only about 3.6 percent of revenue, Deal says.

"The RealNetworks software might be attractive if they have exclusive content not available though Apple....but even so, why would an IPod owner bother to switch devices?" Deal says, noting that RealNetworks Music Store tunes can be played on IPods.

In addition, if it turns out that RealNetworks does offer a wider range of content that Apple, Apple will likely respond positively, Deal says. "Apple has been responsive to customer demand so far, making the IPod compatible with Windows," he adds.

The RealNetworks announcement is nevertheless positive for the company and the online music industry, according to Deal. "RealNetworks will attract people interested in having a choice, and it might make people feel safer about their music choices," the analyst says.