An interesting story in NYT on Apple’s (NSDQ: AAPL) music service versus rest of the industry, and how the music labels have now pinned their hopes on Amazon.com (NSDQ: AMZN), enabling it by lifting DRM restrictions for the online music service the book retailer giant. Pepsi had previously announced it has jumped from Apple to Amazon for a Super Bowl song giveaway promotion…four years ago this was Pepsi-Apple, who along with the four labels gave away 100 million songs through Apple’s online store.

Pepsi’s promotion is back this year on a much bigger scale…a billion songs. Interestingly, The biggest of the four music companies, Universal Music Group, has declined to join the offer over a pricing disagreement, the story says. Amazon is expected to pay the record companies around 40 cents for each giveaway track; Amazon’s usual payment ranges from 65 to 70 cents.

On DRM, all of the companies except the EMI Group still require Apple to sell their music wrapped in the restrictions. A senior record company executive told NYT he was prepared to keep copy restrictions on his label’s songs on iTunes for six months to a year while Amazon establishes itself.

Of course, any expansion of the digital music market is likely to increase sales of iPods, which are more lucrative than the iTunes store, as the story points out.