SEATTLE - Amazon.com Inc. launched its much-anticipated electronic songs
store Tuesday, a step analysts point out stands for the very first pointer of
actual competition for Apple Inc.'s market-leading iTunes.
Amazon MP3, as the brand-new part of the Web retailer's website is called,
presently stocks almost 2.3 million tunes, all without copy-protection
technology. Consumers can purchase and download specific tracks or whole cds.
The monitors could be copied to numerous computer systems, burned into CDs and
used many kinds of PCs and transportable devices, consisting of the iPod and
Microsoft Corp.'s Zune. Read this knockout post
amazon store card for more information.
Songs cost 89 cents to 99 cents each and albums sell for $5.99 to $9.99.
Major music labels Universal Music Group and EMI Music have signed on to
sell their tracks on
Amazon, as have thousands of independent labels.
The company said several labels are selling their artists' music without copy
protection for the first time on the
Amazon store, including
Alison Krauss on Rounder Records and Ani Difranco on Righteous Babe Records.
Amazon's
store competes with Apple's market-leading iTunes,
which is also offering some songs without so-called digital rights management
technology, which prevents unauthorized copies from playing.
Although DRM helps stem illegal copying, it can frustrate consumers by
limiting the type of device or number of computers on which they can listen to
music. Copy-protected songs sold through iTunes generally won't play on devices
other than the iPod, and iPods won't play DRM-enabled songs bought at rival
music stores.
EMusic.com Inc., another popular download site, also sells tracks in the
DRM-free MP3 format but, like
Amazon's
store, doesn't offer music
from some major labels that still require anti-piracy locks.
Bill Carr,
Amazon's vice president for digital music, said it will be
up to customers to use the music they buy legally.
To help stop music piracy, Carr said some record labels add a digital watermark
to MP3 files that indicate what company sold the song, and
Amazon adds
its own name and the item number of the song, for customer service purposes. He
added that no details about the buyer or the transaction are added to the
downloaded music file.
"By and large, most customers just want a great, legitimate way to buy
the music they want," Carr said in an interview Tuesday morning.
"What the vast majority of labels believe is that they will sell more
music by giving customers what they want ... by enabling DRM-free MP3, than by
continuing to confuse customers or force them to choose methods that are not
legal, because the legitimate alternatives are not good."
Carr characterized the number of record labels that still insist on
copy-protection technology as "a handful." But David
Card, an
analyst at Jupiter Research, said in an interview that "having two out of
four labels doesn't cut it."
Warner Music Group Corp. and Sony BMG Music Entertainment, which is owned by
Sony Corp. and Bertelsmann AG, have not agreed to sell music on
Amazon
MP3, and
Card pointed out that Universal and EMI have made only parts of
their catalogs available without copy protection.
"Their catalog is going to suffer for a while," he said, referring
to
Amazon.
Card said
Amazon's entrance into the market represents serious
competition for Apple, which can no longer rely solely on the bond between the
iPod and iTunes.
But,
Card said: "In and of itself, (
Amazon MP3) isn't
enough to change any market share. They have to do a good job at building their
store."
Colin Sebastian, a Lazard Capital Markets analyst, wrote in a note to
investors Tuesday that he doesn't expect digital music sales to boost
Amazon's
profit, "given the significant contribution the company currently receives
from traditional (physical) media sales, and the low margins typical with music
download services, compounded by a highly competitive environment."
