Rhapsody announced the opening of a DRM-Free MP3 store today. The music tracks will be compatible with the Apple iPod as well as most other music players. This represents a significant shift in strategy for the company, who previously sold tracks on a subscription model exclusively. Rhapsody, however, has not completely abandoned the subscription model and still offers this option to their customers.

Rhapsody believes that their incompatibility with the iPod was in part to blame for their lack of market penetration:

"We're no longer competing with the iPod," Rhapsody Vice President Neil Smith said. "We're embracing it."
The new MP3 store from Rhapsody is only available to U.S. customers and contains 5 million songs. Music will be priced similarly to other services at $.99 per song or $9.99 per album.

One unique feature to Rhapsody's service is the ability for customers to preview an entire track, rather than a 30 second window.

[Source: cnn]