Name That Tune on EMI-Apple News

EMI and Apple (AAPL - commentary - Cramer's Take) announced they're going to start selling some non-Beatles EMI music that's essentially DRM-free. Almost as exciting as the DRM-free claim (more later on why I call it a "claim") is that the songs will also be encoded at twice the bit rate, which will make them essentially CD-quality.

As Aaron Task and I discuss in his podcast, this isn't exactly new news. As a matter of fact, the first time Steve Jobs rumbled about wanting to go DRM-free at iTunes, I told Aaron in a video interview that it was fait accompli. The consortium of independent labels had already agreed to these types of terms. The rest of the labels will slowly but surely recognize that fighting the "virtuous entropy" of this end-user empowerment is not just stupid, but futile.

The best play on this development? Akamai (AKAM - commentary - Cramer's Take), as the 128 kbps iTunes songs are about 3mb each, while the 256 kbps versions are going to be twice that. If the entire industry shifts to CD-quality music, Akamai will have a brand new avenue of growth from its existing, biggest customers, including Apple.

The worst play? The music labels, even EMI. They seriously think that consumers will be OK with paying more for a digital download song? As my favorite music analyst Bob Lefsetz wrote today in a great rant on this topic, "You want to sell more tracks at the iTunes Store? Make them a quarter. Or 15 cents or a dime. Then watch sales go through the roof."

I agree. Price the songs at a couple of dimes each, and sales would go through the roof, as people would rather buy high-quality songs than steal low-quality ones. But expecting to see some sort of spike in digital download sales by raising prices is, well, foolish. Ain't gonna happen.

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Cody Willard is the manager of CL Willard Capital Management, LLC. He is a regular guest on Fox News, CNBC and other networks, and he writes a monthly column for the Financial Times. He is also an adjunct professor at Seton Hall University and the author of TheCodyReport.net, a monthly stock market newsletter. Willard appreciates your feedback -- click here to send him an email.