Real Cuts Cord on PlaysForSure, WMA

By Ed Oswald, BetaNews

September 18, 2006, 1:03 PM

Real said Monday that its Rhapsody service would switch over to its own in-house DRM software called Rhapsody DNA, ending a partnership with Microsoft for its PlaysForSure Windows Media technology. The SanDisk Sansa e200 line will be the first with the DRM embedded.

The announcement puts to an end Real's short-lived use of Microsoft's PlaysForSure digital rights management technology. Real began employing PlaysForSure following its settlement with Microsoft last October. However, Microsoft's DRM proved to be glitchy and prone to error, the company said.

Add to this Microsoft's apparent abandonment of the technology with the release of the Zune and its own DRM layer, and it appeared time for Real to step out on its own. "The fact that one company was making the player, one company was making the software and a third company was making the service meant it was not seamless," Real's senior vice president of music Dan Sheeran lamented to the Associated Press.

However, Real was quick to assure BetaNews that users with PlaysForSure content would still be able to use it with Rhapsody, although in a limited way.

"We'll support either technology," RealNetworks spokesman Matt Greaves said in an interview. "However Rhapsody DNA will allow us to offer new features that PlaysForSure cannot." To use these features, the user would have to upgrade their player and download tracks in the RDNA format.

Both PlaysForSure and RDNA would be able to coexist on a music player, although Real's technology does not depend on Microsoft software in any way. The company's deal with SanDisk also puts the new DRM platform on the second-best selling portable audio players in the country.

In addition, Real said it was working with other manufacturers in the market to add RDNA to those players as well. It could be argued that Real sees an opening in the market created by PlaysForSure's apparent exit, and is preparing to take advantage of it. However, it also means another closed-DRM platform, says JupiterResearch senior analyst Joe Wilcox.

"The larger question is what will other disassociated PlaysForSure vendors will do? Real has its own technology to fallback on, which isn't the case for most other vendors with music stores," he added.

Fellow JupiterResearch analyst Michael Gartenberg seemed to agree, but pointed out that the DRM market is beginning to become overcrowded. "At the moment there's Apple, Sony, Microsoft, Nokia and Real," he said. "I'd expect to see at least one more player by year's end and that's just too many folks that aren't well differentiated from each other for the market to bear."

In any case, Real's switch to its own platform is a huge loss for a technology Microsoft once considered as game changing. Rhapsody is the second largest online music store overall, and the largest subscription based service with nearly 1.7 million subscribers. Most other music stores based on PlaysForSure have numbers which are less than half that of Real's service.