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This is interesting, but I'm not sure how well it will work when there is already a method (SFIR http://www.mikeindustries.com/blog/sifr/) that works around this licensing issue completely.

I suppose it will really come down to pricing, but they're going to really need to cut into those expected royalties if this is going to fly. It'll be interesting to see if font designers are as pig headed as music labels, or if they can understand that a lessor percentage of a larger total is the better deal.

Those text replacement techniques (sIFR/cufon) have downsides though. You can't manipulate the replaced text as you would normally, you lose some functionality because you've replaced text with flash/canvas/image etc., and you won't see anyone replace entire body text using those techniques.

Using the standard @font-face css technique instead of a text replacement hack allows your custom fonts to have all the same benefits of standard browser text.

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