San Diego-based entrepreneur Michael Robertson is among a small handful of people who ushered in the digital music revolution in the late 1990s. His MP3.com--in its original incarnation--opened up the Web as a place for artists to market their music and for fans to discover it.

But it also drew the legal wrath of the music industry and was sued into submission in 2001. CNET Networks bought the assets of MP3.com from Vivendi Universal in November 2003.

Since then, Robertson has started a number of companies, one of which, MP3tunes, has stumbled so far without licenses from the major labels.

In part one of this interview, Robertson said digital music is still in the Stone Age. But with a new project called Oboe under way, Robertson is making some bold claims, promising to bring it into the 21st century. He brought noted software engineer DVD Jon--who was tried for and acquitted of creating software that cracked the encryption on DVDs--over from Norway to help him.

Robertson tells MP3.com that Oboe will give consumers what they want: music in the clouds, accessible from anywhere.

MP3.com: So we've talked about what's wrong with the current state of digital music. Let's talk about what you're going to do to fix it. So far, because you're not using DRM copy protection on the downloads offered in your store, it's all independent and unsigned artists--no major label tracks, right?

Michael Robertson: Yeah. Right now, in the big picture, MP3tunes is irrelevant. We're not moving a significant amount of music. But our goal was never to be just an independent music site, but to really get people thinking about music lockers and music ownership.

With us, once you buy that album, it's in your locker forever. If you want to access it from a new computer, your computer gets stolen or lost or a part just breaks, you can always get to your music. That's what I want to impress upon the industry.

MP3: What have your conversations with label execs been like? Are you even talking to them at this point?

MR: Yes, we are. But at this point, to them, DRM is a religion. And to me, DRM is an economic issue. In their minds, the only way that they think they can make money is to use DRM. My position is, "Hey, you should use whatever helps you make the most money. But don't assume that's DRM."

I'm encouraging them to do some trials. Sell MP3 albums for, you know, $15 instead of $10 like they do on iTunes. Will people pay 50 percent more if it's an MP3 and they can have it forever? For the labels, that's more money for the same music.

So instead of trying to sell people the same music multiple times in different forms--CDs, iTunes, etc.--charge them once and up the price.

MR: Right. They should experiment with DRM and non-DRM. And whatever makes the most money, that's what you should do. They have a product they want to sell. They want to maximize the revenue, and what I'm suggesting is you can maximize revenue by selling it without DRM. That's a hard step for them to make.

MP3: Especially now that the labels probably feel that they're heading in the right direction. So you face an uphill battle on this one, no?

MR: True. But there's one ace in the hole that I have.

MP3: Which is?

MR: CDs. They say, "We don't want our music to get out there in unprotected forms." And I say, "Guys, you're selling perfect digital copies every day! Through every Wal-Mart and every music store around the world." It's too late to force the whole world into a DRM system. Thousands of CDs with no DRM whatsoever are sold every day. As long as you're doing that, any long-term push towards DRM is torpedoed.

If they're prepared to no longer sell CDs as of tomorrow, then maybe they'll be able to jam everybody into a DRM world. But that's where 95 percent of their revenues come from. So, the whole argument "Well, we don't want to sell MP3 files because we don't want unprotected files out in the wild" is a moot point.

MP3: Let's talk about your decision to hire DVD Jon late last month. He's obviously been a thorn in the side of the entertainment business. Does he potentially hurt the labels' perception of MP3tunes and this new project he's been bought in to work on?

MR: Well, they may be concerned, but ultimately it's irrelevant. The product has to speak for itself. They can have confidence that whatever technology I roll out, it will be good for the industry.

I will always work within the spirit of copyright law. Technically, I'm the largest copyright infringer of all time, technically, but I go to bed every night knowing that what I did was the right thing. And it may not have been interpreted by one judge to be the right thing, but I don't lose any sleep over building what I built.

MP3: I know that you don't want to say much about Oboe right now, but let's at least talk about it for a minute. Can you say whether it will be something that a consumer would use or whether it will be more of an infrastructure kind of a play?

MR: I try not to talk about products until I can give you an URL and say, "Go taste this. Go eat this." But you know me. I'm a consumer guy. I'm not an infrastructure guy. I make products for the mass market. A leopard doesn't change its spots. That's what you can continue to expect.

MP3: It's safe to say that whatever Oboe is won't involve DRM whatsoever, right?

MR: Yeah, that's a safe assumption. I should stress that I'm not politically, religiously against DRM. Businesses should absolutely have the right to sell DRM products, no question about it. And if consumers want to buy it, hey, go for it. That should be their choice. The point that I try to stress is, number one, it's not the way you make the most money. You make a lot more by having innovative strategies, which give people more value from their music rather than less value from their music.

MP3: Will Oboe be an add-on of MP3tunes or something entirely different and separate?

MR: We'll use some of the same technology that we've been working on with MP3tunes. But it will be something pretty markedly different than what you see today.

MP3: And what's the timeline for launch?

MR: Before the end of the year.

MP3: All right, we'll be on the lookout. Thanks, Michael.