It was widely believed that EMI was on the verge of selling a non-DRM license to sell their music online. They were willing to do it, but for a price that neither Apple or Microsoft were willing to pay. I think that this move was to discourage online retailers from offering non-DRM'd stuff.
Why should they offer non-DRM'd MP3 files for sale? Well for one, I might actually start buying them. Like a lot of other users that have MP3 players that do not accept DRM files, I have never purchased music for my player. I rely completely on ripping music from cds and I back in the day I used to use file sharing. I don't do the latter at all anymore because of the RIAA and their suits.
I believe if that they removed the DRM from their files and sold MP3 files capable of playing on all players that their sales would go through the roof.
Source: http://arstechnica.com/news.ars/post/20070225-8916.html