Phil Schiller, during his Macworld Keynote (see our MASSIVE live blog!) today, announced -- as rumored -- that iTunes is going DRM-Free! 8 million songs will be available in higher-quality 256-bit, DRM-free iTunes Plus format immediately, the remaining 2 million or so songs following by the end of the quarter.

In order to wrestle this concession from Big Music, however, Apple had to give them a concession of their own: variable pricing. Apple had long resisted this policy, preferring the unified $0.99 model (a brief flirtation with $1.29 iTunes Plus pricing not withstanding). Today, however, Schiller announced a 3 tiered structure:

  • $0.79 for older, catalog songs
  • $0.99 for mid-tier
  • $1.29 for premium (hot new singles?)

Upgrading will cost $0.30 per song, $060 per music videos, and whole albums for 30% of the album price.

So, is it working for you yet? And are you upgrading? Or just buying new song?