The Music War: Amazon MP3 versus iTunes

By Max Brenn
17:01, September 26th 2007
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The Music War: Amazon MP3 versus iTunes

Every time an MP3 producer launches a new player, or a website announces a new online music store, the comparison with the famous iPod-iTunes duo is almost inevitable. As for this unwritten rule, same goes for the newly arrived Amazon MP3, the latest initiative of the famous online retailer.

As you might know already Amazon MP3 is offering some 2 million songs without any copy protection or software restrictions on how the music can be played. The new store features 180,000 artists and 20,000 record labels with songs priced from 89 to 99 cents and albums from 6 to 10 dollars.

Amazon MP3 is base mainly on music catalogues provided by EMI and Universal Music Group.

EMI has started to offer its music as DRM-free tracks earlier this year, few weeks after Steve Jobs has posted on Apple’s website its famous open-letter “Thoughts on Music”. In fact Steve Jobs joined EMI officials in April in the press conference in which they announced the release of DRM-free tracks

Universal Music Group joined EMI in DRM-free revolution in August. UMG is holding approximately 30% of the world’s music market, with one-in-three tracks being released under its umbrella.

The other two major record companies, Warner Music Group and Sony BMG Music Entertainment, have said they will not sell music without the protections because of the concern that music will be illegally copied and distributed for free.

But let’s go back to Amazon MP3. Almost 90% of the articles in which the Amazon MP3 is mentioned bear a comparison with the iTune, be it from a price policy or number of items in the catalog point of view.

The comparisons are well justified seeing how iTunes is currently the world leader on the online music market and that in fact holds a share in the market that’s almost impossible to catch up with. According to research group NPD iTunes controls 70 per cent of the market for authorized downloads and has sold more than 3 billion songs since its April 2003 debut. The service offers more than 5 million songs, 550 TV shows and 500 movie.

Amazon.com is also a music giant. It has 69 million active customers and is the No. 4 retailer of music in the nation, according to research firm NPD Group.

But the one thing that seems to be missing from all these comparisons, Amazon MP3 versus Apple’s iTunes is the fact that the two rivals somehow fundamentally different.

From the beginning the online music store belonging to Apple had and has one goal in mind and that is to provide iPod possessors with their favorite music.

As it did in previous cases, Apple ended up creating two different products, strongly interdependent, of which success depends on one another. Out of all the stores that offer similar services to those of the iTunes, none include an MP3 player in the package.

That is why I do not think you can say there is a real competition between the Amazon MP3 and the iTunes.

The Amazons MP3 success or lack of success should only be reported to that of similar initiatives like Yahoo Music, Napster or Real Networks and not to iTunes.

Fact of the mater is that Amazon is indeed a famous retailer and obviously with the purchase of one of its MP3 players the customer could choose from a variety of music catalogues.

The problem though is the fact, that unlike Apple that owns the iPod, Amazon does not own its players and thus could make it difficult for the company to promote an MP3 player through music or the other way around.

Indeed, unlike other music stores, the MP3s from Amazon MP3 are playable on iPod and iPhone, but it’s hard to believe that the retailer’s store will manage to lure away too many iTunes’ customers.

In conclusion, the presence of a store which sells DRM-free music of the Amazons stature is welcomed especially by those who aren’t already iTunes customers.

Still its numbers of tracks are still too low to pose a real threat to iTunes, and it will probably repeat the evolution of the other service provided by Amazon, Amazon Unbox.

In other words in the absence of a competitor able to equal the Apple (iPod+iTunes) combo, when it comes to the digital download market one can only talk about Apple on one hand  and the rest of the providers, on the other hand, kind of Apple versus the rest of the world.

On the other hand, Microsoft with its famous Zune player has demonstrated that even with a very similar offer to that of the iTunes, it is still difficult to fight for supremacy.



© 2007 - 2009 - eFluxMedia
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