Real Aims At Apple With Harmony Launch, Half-Price Promo

RealNetworks Tuesday announced the Freedom of Choice campaign, ushering in iPod compatibility with its music store files by offering songs for 49 cents and most albums for $4.99 "for a limited time." With its eyes set on iPod owners who have been locked in to the iTunes Music Store, Real also launched a companion web site.

"To celebrate Freedom of Choice, weire running the biggest music sale in history," Rob Glaser, founder and CEO of RealNetworks said in a statement. "Thanks to RealPlayer with Harmony Technology, consumers can now buy digital songs and play them on virtually any device of their choice, just like how CDs and DVDs work. We believe Freedom of Choice is both the right thing for consumers and a crucial step in bringing digital delivery of music into the mainstream."

Harmony is Realis latest audio technology, providing compatibility with all digital music players, including the closed-system iPod. Real introduced Harmony in late July, touching off a spat with Apple, which days later accused Real of employing "hacker" tactics to circumvent iPod technologies.

The Freedom of Music Choice website promotes the campaign with advertisements for 49 cent downloads, an endorsement of Harmony from Public Knowledge, blogs with bitter sentiment for Apple, and a petition to "tell the [sic] Apple you want the right to choose where you get your music." Apple previously cautioned potential purchasers of Harmony tracks that future iPod software updates could break Harmony compatibility with the device.

A spokeswoman for Apple said Monday the company would have no immediate comment.

In the wake of the announcement, RealNetworks revised downward its third-quarter outlook, warning investors it expects to lose 3 to 5 cents per share as a result of the promotion. Analysts had anticipated losses of 1 to 3 cents per share for the quarter and believe the 49 cent downloads could cost the company about $2 million in lost revenue.

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