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In defence of newspapers and serendipity
This is a year before the iTunes store opened up on 4/28/2003. I think Steve found the labels didn't agree with him, but his desire to open up the store led him to give in on it.
Note also that Apple bought Fairplay from Veridisc sometime around the end of 2002 (couldn't locate the exact date). There's good reason to believe that Apple was not working on DRM but had to get it in order to open up the store.
As for self-serving reasons: MS holds key DRM patents, which makes enhancing FairPlay for new innovative uses difficult unless Apple is willing to pay MS for licenses.
He's just getting the market to be on his side when he confronts the labels with this, and thus reduce the cost he'll have to pay to get it. Remember that Universal's going in position is a few dollars per iPod sold, a la its Zune deal.
http://www.winextra.com/?p=276
And it may have been a statement made on Apple's part but attributed to Jobs.