I bought my first MP3 today, from Warp Records' Bleep. It's online music done right: reasonable prices, good encoding, no stupid DRM. And buying direct from the label makes it easier to buy more obscure releases from Aphex Twin, Autechre, Boards of Canada, Plaid, etc.
The legendary Twoism, originally issued in a limited vinyl-only pressing on BoC's own Music70 label. Before this reissue and CD release in November 2002, copies were changing hands on Ebay for up to £800
The MP3s are well encoded via Lame 3.90 --alt-preset standard resulting in VBR with rates around 175kbps. The files have good ID3v2 tags (but lousy names). And the downloads are fast, 100kbytes/sec or better.
The usability on the UI is good although I'm not wild about the monolithic Flash app with tiny fonts. The music preview option works well. My only real complaint is they don't let me download stuff forever: you're responsible for keeping track of the files yourself.
Buying music online makes so much sense. I could buy Autechre EP7 for $13 on Amazon and wait a week to get a CD I'll rip and then store forever, or I can download it on Bleep for $7. And I'd rather pay a few bucks than try to steal a crappy, incomplete copy online.