Joel, I really think you have got this back to front. DRM over which Apple has absolute control, even if/when it is cracked by hackers, is what enabled Apple to negotiate at the outset very flexible terms of use for iTunes downloads that match CD terms of use, and allow an iPod to continue playing DRM'd music in perpetuity without being "re-authorized" regularly by a global DRM mother ship. Everyone else offered the end user a horrible deal and their download services have successively folded, usually leaving customers with nothing. The labels so desperately want music sold through other channels than iTunes that they almost certainly directly breached a "most favored nation" contract clause, making Apple wait over a year before being allowed to match Amazon's DRM free terms of use that the labels gave in a last ditch attempt to stay relevant to music distribution. (In fact, Steve Jobs lost his patience with their delaying tactics after a year: “They’re trying to create a competitor to iTunes by denying us D.R.M.-free music”)
Amazon Gaining Share on iTunes [View article]