"... It could be an iTunes killer..."

That's what the email said that I got yesterday morning from a friend. I've been around this stuff long enough that I can't tell you how many times I've heard that phrase. The last time? The heralded Microsoft Zune player. Where is it at today? Gasping for air - sitting on store shelves as prices continue to drop in an effort to sell inventory.

So, it was with trepidation that I clicked the link to Amazon's newest foray into the technology world - Amazon MP3. What I found surprised me.

Amazon is offering DRM-free, high-quality MP3s for a dime less than iTunes. DRM stands for digital rights management - the software that essentially 'locks' a downloaded song and forces you to only use it the way the store wants you to. What does this mean? It means that, unlike iTunes and many other online music stores, you can purchase the song, put it on your laptop and your kids' computers, put it on your wife's cell phone, burn a CD, play it on your son's PSP, your iPod, and your daughter's Zune - all with one purchase. (Disclaimer: I haven't checked the terms of service/usage rights; it's likely all these will be allowed - as long as you don't give the song to a buddy to play, or post the file on the Internet for free download.)

There aren't many online stores that will give you the freedom to do all these things with your own music (that you purchased). iTunes, for example, limits you to playing their normal 99 cent tracks, on up to 5 devices that you have authorized. You can burn them to CD, but forget about playing them on anything but your computer or iPod - they simply aren't compatible with other media players out there.

You can go to Wal-Mart's online music store, which is now also carrying DRM-free MP3s. They charge you more for them, though (approx. 94 cents), and still are pushing the majority of their music as DRM-ed WMA files (Windows Media format - doesn't work with iPod, and, ironically, Microsoft's own Zune).

Caveats? Honestly I don't see any. The only thing people might complain about is if they can't find a song they want, but it looks like Amazon has a good stockpile & that's only going to expand. MP3 isn't the favorite format for some people, so that might be another sticking point. There are certainly better compression formats out there, but MP3 is still the standard and most widely used and Amazon is encoding the media (or the record labels are) at a high bitrate (around 256kbps) - which is the compression rate iTunes is using on their premium 'iTunes Plus' $1.29 tracks (which are also DRM-free, although AC3 format).

If anyone can make a dent in Apple's online music empire I think Amazon can. It's not going to happen overnight. May not even happen in the next year. But slowly they are going to be able to take back some market share a piece at a time. Others will follow suit. If the dent is big enough we might even (hold your breath) see iTunes price breaks!?

Okay, that might be going too far - but who knows. Amazon is doing it right. If they get labels on board & are able to meet demand with a large inventory of available tracks/albums, and if they can control the price point & keep it from ballooning after people begin using the service - they might just be on to something.

• Visit the Amazon MP3 Website