Let the MP3 Price Wars Begin

Updated from Sept. 26

SAN FRANCISCO -- It's over. Restrictions on copying digital music are going to be history -- and all hell could break loose in the music retail business.

Amazon.com's(AMZN) move to sell more than 2 million songs free of digital rights management software, or DRM, could well be seen several years from now as the point of no return for this controversial technology. The days of music companies telling consumers when and how they can listen to their songs are numbered.

It won't happen overnight. Amazon's move is -- to lean on that useful but overused buzz phrase -- a tipping point. DRM is a well-intentioned idea that served to drive many music consumers away.

You can debate all day long whether DRM is good or bad, but all the arguments are moot. The market has spoken. DRM hurts sales. And that's bad for business.

Amazon's DRM-free store is launching on the same day that Virgin Digital, Sir Richard Branson's stab at an iTunes clone, is being shuttered.

It wasn't long after some music labels started experimenting with selling DRM-free music that they started to see a substantial increase in sales.

One of the biggest beneficiaries of DRM has been Apple(AAPL). As Daniel Del'Re pointed out in his coverage of the Amazon announcement, when people buy songs on iTunes, "the only portable music device on which users can play back songs is the iPod."