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Needham & Co's Charles Wolf told CNN Money that, 'Harmony could help iPod sales. It could also take some sales away from the iTunes store, but it's the iPod that makes the money.'

Harmony works by reverse engineering the FairPlay rights management system which only allows songs downloaded in the AAC format from Apple's online store to be played in the iPod (as well as songs traditionally ripped from CDs as unprotected MP3s). This allows songs from Real's own store, which uses its Helix DRM software, to be converted to the AAC format

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for playing on an iPod.

Real has also said that it may license Harmony to other stores. Chief strategy officer Richard Wolpert told CNN that, 'we're in discussions and happy to be in discussions.'

The question that neither Real nor any analysts have neither asked or answered, is why anyone would want to buy music from Real's store and then have to convert it, when the iTunes Music Store has as comprehensive a collection of music, is by common consent the easiest to use and is as cheap or cheaper than its rivals.

Apple has remained resolutely silent, to the extent that it cancelled (due to sickness!) a planned keynote at the same New York conference where Real first unveiled Harmony.

Real will doubtlessly be hoping to improve further on its latest quarterly financial results, which showed a 32 per cent year-on-year rise in revenues but a loss of $4.6mn.

'In the second quarter we achieved strong revenue growth in our core consumer businesses. Driving our revenue growth was continued momentum of our music and games products and services,' said CEO Rob Glaser. 'We now have more than 550,000 subscribers to our digital music services, which we believe makes us number one in music subscriptions.'