Tuesday, December 11, 2007

New Services Challenge iTunes

From Peter Burrows, BusinessWeek:

There's no doubt that Apple (AAPL), with its elegant 99¢-per-download formula, is the dominant force in digital music. But it's next to impossible to find an industry expert who thinks that Apple's current approach will remain the only game in town forever. Now there are signs rivals will help shape the future of digital music as well.

Some of the most immediate pressure is coming from Amazon.com (AMZN), which launched its Amazon MP3 store on Sept. 25. The store offers a few things Apple doesn't. First, there's pricing. Amazon MP3 sells 1.8 million of its 2.5 million-plus tracks, including 100 of the most popular, for 89¢, rather than 99¢. Also, it sells music only in the basic MP3 format, without any antipiracy "digital rights management" (DRM) software.
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