last100 » AmazonMP3

Amazon MP3, Wal-Mart and Rhapsody just made buying music more confusing following iTunes’ lead

Steve O'Hear — Wed, 08 Apr 2009 16:21:57 +0000

With the major labels cajoling Apple into upping the cost of the most popular tracks on iTunes, I wondered how long it would take other music download stores to follow suit. Not long it seems – less than a day in fact – with paidContent and Ars Technica reporting that Amazon, Wal-Mart, Lala and Rhapsody have followed Apple’s lead and introduced ‘variable pricing’.

Of course, none of this down to the stores in question. The major labels set wholesale prices for tracks, and each download store then follows suit, give and take varying margins and the odd, possibly loss making, promotion here and there. Some might argue that ‘variable pricing’ alone isn’t necessarily a bad thing, although it does sacrifice the simple buying experience that Apple first introduced with its 99c per track rigid pricing structure on iTunes. What’s certainly short sighted is to use ‘variable pricing’ as an excuse to raise the upper limit of price per track, especially in a time of recession and when less and less people still pay for music anyway.

There’s also a complete inconsistency in pricing across each store on a track by track basis. It’s not even as simple as paying more for the most popular tracks. For example, Amazon is cheaper than iTunes on some top 40 tracks and vise versa. As paidContent notes: “comparing like with like can be difficult”.

Update: ComputerWorld’s Seth Weintraub is reporting that the major labels are giving Amazon more favorable terms over Apple– cheaper wholesale prices — which would be consistent with past behavior.

Sources at Apple tell me that Apple is getting different prices than Amazon from the recording idustry. The record companies are, and have been for awhile, favoring Amazon. In fact, Amazon is selling songs for less than the price that Apple pays for them in some cases.

The motive: The majors are determined to weaken Apple’s power in the music industry, and with some success, punishing them for selling all those damn iPods.

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Amazon MP3 arrives in the UK

Steve O'Hear — Wed, 03 Dec 2008 17:59:08 +0000

With little or no fanfare, Amazon’s MP3 store has arrived in the UK. And in keeping with the credit crunch spirit of late, there are some real bargains on offer. Albums currently start at £3 (approx. $4.5) and some individual tracks are being offered for as little as 59 pence (87 cents). If you’re old school like me, for example, the first few Led Zeppelin albums fall in the £3 bargain bucket selection. Nice.

As is standard with any digital music store-related announcement these days, we received a press release from competitor 7Digital offering up the “strong” views of CEO Ben Drury.

“We’d like to congratulate Amazon UK for finally entering the MP3 market albeit a little late. We announced on September 16th that we were the first in Europe to achieve this. It’s great that general retailers like Amazon clearly recognise the importance of digital music for consumers and the MP3 universal music format which works on all devices.”

Drury then goes onto bemoan Amazon’s lower bit-rate: “their MP3 downloads are only 256kps quality so they are not delivering the high quality 320kps MP3’s unlike 7digital”.

Doesn’t sound all that congratulatory after all.

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Report: iTunes still leading music store in the U.S.

Steve O'Hear — Wed, 06 Aug 2008 13:54:19 +0000

Apple’s iTunes remains number one in the U.S. amongst all music retailers according to the latest NPD MusicWatch figures. Based on purchases of CDs and a-la-carte digital music downloads from January through to June of this year, the league table is as follows:

iTunes
Wal-Mart (Walmart, Walmart.com, Walmart Music Downloads)
Best Buy (Best Buy, Bestbuy.com, Best Buy Digital Music Store)
Amazon (Amazon.com, AmazonMP3.com)
Target (Target and Target.com)

NPD says the results reflect “the ongoing consumer shift from physical CDs to digital music”, which has helped iTunes to consolidate the lead it established earlier this year.

Most notably, Amazon has moved from fifth place to fourth, which NPD attributes to stronger CD sales online compared to competing brick-and-mortar stores, along with the launch of the company’s own music download store, AmazonMP3, last year. As a result, we shouldn’t be surprised to see Amazon overtake Best Buy in the not too distant future.

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Free ad-supported music leads to more sales

Steve O'Hear — Wed, 09 Apr 2008 17:19:34 +0000

So says Last.fm

Since CBS-owned Last.fm re-launched its free ad-supported music service in January, with licenses from all four of the major labels, overall CD and download sales through the site’s partnership with Amazon.com have experienced a 119% increase. The upturn in sales can be accredited to an increase in new visitors as well as existing users who, according to Last.fm, have purchased 66% more music than they did prior to the free-on-demand offering. Last.fm also has affiliate deals with iTunes and 7Digital.

Last.fm’s co-founder, Martin Stiksel said in a written statement: “In just over two months it’s become clear that people will buy CDs and downloads if they get access to the kind of service we offer. No one else can give music fans this amount of music for free — but more importantly also drive their discovery, as we do through our unique recommendation engine. That’s why people are sticking around on Last.fm — minutes spent on site are up 118% month-on-month — and discovering new music to listen to and buy.”

It’s not really all that surprising that an Internet radio type of service is providing leads to music sales — it’s hardly a novel concept. Listen and discover new music for free, then purchase it for repeat listening on any device, including iPods. Not only does Last.fm have better tools for discovery than traditional radio but the site’s restrictions also give a gentle nudge towards purchasing, whereby each track can only be streamed three times for free before you’re redirected to a music store.

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