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Apple changes iTunes pricing

Computer maker, at Macworld, unveils tiered pricing for songs, as well as a new 17-inch laptop and revisions to software programs.

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NEW YORK (CNNMoney.com) -- Apple unveiled a change in the pricing structure for its iTunes music downloads Tuesday, ending the 99-cents-a-song pricing that has helped iTunes dominate the industry.

At the Macworld 2009 show for developers in San Francisco, the computer maker also revealed a new 17-inch version of its MacBook Pro laptop that the company said offers a longer battery life.

Additionally, Apple announced revisions to its iLife and iWork software packages.

The announcements were made by Senior Vice President Phil Schiller, who delivered the show keynote in place of CEO Steve Jobs.

Schiller said iTunes will now offer three price points for songs: 69 cents, 99 cents and $1.29. It will also offer all of the 10 million songs in its library without copy protection, and will allow iPhone users to download songs through 3G wireless networks.

In a press release accompanying the announcement, Apple said the pricing of a song will be based on what music labels charge. The labels that have agreed to the pricing include the four biggest - Universal Music Group, Sony BMG, Warner Music Group and EMI.

Many in the industry has been critical of Apple's 99-cent pricing, with some executives saying that it cut into profits on hit songs that could sell at a higher price.

Schiller said some 6 billion songs have been downloaded from the iTunes Store since its inception in 2003.

New laptop

The Apple exec said the new MacBook Pro will offer up to eight hours of battery life, a 4-gigabyte memory and a 320-gigabyte hard drive. The laptop is priced at $2,799 and will be available later this month.

Among the iLife changes Schiller unveiled were:

  • a revision of the iPhoto program that allows the user to sort pictures using face recognition.
  • the addition of mapping software to iPhoto to organize pictures by where they were taken.
  • the creation of a teaching component for the GarageBand music editing software, with lessons available from such artists as Sting, Norah Jones and Sarah McLachlan.
  • and the addition of new editing tools in the iMovie component that includes new effects and themes.

The iLife revisions will be available with new Macs, with upgrades to existing Macs available for $79.

For iWork, Apple's answer to the Office business software by Microsoft Corp. (MSFT, Fortune 500), revisions unveiled by Schiller included a new transition feature for the Keynote presentation program, the ability to transfer presentations to an iPhone or iPod Touch, and the ability to allow use of the Pages word processing software on a full-screen basis.

That program is priced at $49 for new Mac purchasers and $79 for existing Macs.

Tuesday's announcements were overshadowed by the chatter about Jobs, who did not attend the presentation. On Monday, he revealed that he is being treated for a hormone disorder that is causing him to lose weight.

Jobs said he will continue to serve as CEO while undergoing treatment.

Apple said last month that this Macworld would be the last at which it will present new and revised products, saying it can reach more people through its Web site or its retail stores around the world.

Shares of Apple (AAPL, Fortune 500) turned lower after the presentation in San Francisco ended. They were down $1.05 to $93.52, after being up by more than $2 during Schiller's keynote. To top of page

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