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Sony, Universal and Warner have so far resisted Apple’s desire to drop DRM entirely from its digital music service. The fourth and smallest major, EMI, broke ranks in 2007.

If the EMI experience is repeated, DRM-free will also mean higher quality—Apple encodes unrestricted music at twice the bitrate and the difference in quality is audible.

As a quid pro quo for dropping DRM Apple is said to have ended its resistance to labels’

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demands for more flexible pricing. Cnet reports that back-catalogue music will now be sold for 79¢ in the US, where currently all tracks cost 99¢.

Apple is expected to announce the new deals later today during Phil Schiller's keynote speech at the San Francisco Expo.

Cnet also claims that Apple and the labels have also agreed to allow over-the-air downloads to the iPhone for the first time.

The first hint that Apple may be on the verge of a deal to drop DRM came towards the end of 2008, when music from artists signed to Sony, Universal and Warner briefly appeared in the Upgrade My Library section of iTunes Plus, the DRM-free area of Apple’s Store. This suggested that Apple had already begun the huge task of repopulating its database with the unencumbered and higher quality files.