Amazon, the online retailer, yesterday released details of its long-awaited music download service, which is expected to give a jolt to Apple's dominant iTunes store.
More than 2 million songs – including those by Amy Winehouse, U2 and 50 Cent – will be made available for download from Amazon's US site, with tracks costing either 89c or 99c, and albums between $5.99 and $9.99.
The songs, to be sold through a store called 'Amazon MP3', will have no copy protection technology attached, meaning they will be able to be played on a variety of devices, including Apple's iPod, the company said in a statement.
Analysts said the service would present a threat to iTunes, which has a 70 per cent share of digital music sales, because iPod owners keen to buy songs without copy protection would be tempted to go to Amazon rather than pay $1.29 for them at the Apple store.
Deals with 20,000 labels, including two majors – Universal Music Group and EMI – also meant that the Amazon MP3 would offer a significant range of music, an issue which has dogged other providers of digital downloads.
Amazon's service adds yet another layer of depth to the increasingly complex market for digital music, where at least three separate models have emerged.
Alongside the traditional 'pay-per-song' model favoured by iTunes, there is the subscription – or 'all you can eat' – model offered by Napster, where users pay a monthly fee to download as much music as they like, and the advertising-supported model adopted by Spiralfrog, a new service, where music is free provided the user watches ads.
Analysts said Amazon's announcement would put pressure on Apple to cut its prices, but that both services would struggle to convince customers that they should pay for digital music, especially when songs could so easily be downloaded for free.
"There will definitely be a type of music – older and rarer songs – that people value and will likely to pay for, but if you're talking about chart songs that are 10 a penny on illegal download sites, it's going to be much more difficult to convince them to pay," Rebecca Jennings, an analyst at Forrester, said.
The digital music market nearly doubled in value last year – from $1.1 billion to $2 billion (£542 million to £985 million) – according to the IFPI, but the growth has so far failed to offset the decline in CD sales, which have slumped by 23 per cent globally since 2000.
Source: The Times
Author: Jonathan Richards
Date: 26 September 2007