Is Amazon Already The #3 Music Seller?
October 23, 2007 at 5:38 AM (PT)
AMAZON’s music store has only been in business for a month, and rumors are flying that it’s already the #3 online music seller. VENTUREBEAT.COM reports it’s still far behind APPLE iTUNES, but that might change. One rumor even pegs AMAZON passing the second largest download site, EMUSIC, in revenue by the end of this year.
That leaves companies that don’t have a large online presence in a difficult position. NAPSTER, WAL-MART, RHAPSODY and EMUSIC are all looking vulnerable and likely to lose out if AMAZON’s growth continues.
Besides not DRM'ing its music, AMAZON’s early apparent success can be chalked up to a clean interface, lower prices and most of all, the ability to easily transfer music to the iPOD. Arguably, AMAZON’s mp3 store has pressured APPLE to recently drop prices and increase selection for DRM-free music on iTUNES, called ITUNES PLUS.
Besides AMAZON, the major record labels have also begun to test-sell music without DRM this past year, because they’ve had trouble negotiating song prices with APPLE. What’s more, the DRM software used by the labels does not play on the iPOD directly, and none of the labels wanted to switch to APPLE’s own DRM software, called FAIRPLAY.
EMI was the first label to sell their catalog without protection and the results from their first quarter experiment have tentatively proven a success. The largest music label, UNIVERSAL MUSIC GROUP, followed suit a couple months ago and began selling DRM-free music files in a six-month trial.