Big music stores mothball plan to fight Apple’s iTunes Music Store with online music venture

“A group of big music stores has mothballed a plan to join forces on the Internet to fight on-line services such as Apple Computer’s iTunes, a move that highlights painful choices brought on by a digital shakeout,” John Borland reports for CNET News. “Echo, a joint venture launched with a splash of publicity in early 2003, was designed to give the big brick-and-mortar retailers such as Best Buy and Virgin Megastores an on-line foothold that would help them beat back file-swapping services and digital stores.”

“But mounting development costs, a glut of rivals offering bargain-rate services, and smaller-than-hoped-for sales across the on-line-music spectrum, even at Apple’s successful store, have led the big retailers to pull funding for the project, its founders say,” Borland reports. “‘The reality is that compared to all the retailers’ bottom lines, even Apple’s music sales are insignificant,’ said Alex Bernstein, a co-founder and investor in the Echo project. ‘Our board repeatedly told us that.'”

“In January 2003, [a group of music store companies annoucned they would] use Echo-built technology to create a suite of digital music services backed by the giant retailers’ brand names. A seventh member, Borders Group, joined shortly afterward. It was Apple and its iTunes music store that genuinely shook up the market a few months later, however. From that point, Echo’s future slowly clouded,” Borland reports.

Full article here.

MacDailyNews Take: Shortsightedness is in copius supply in this case. All the better for Apple and the iTunes Music Store.


  1. BestBuy was way late to the eCommerce game but because of their brand and reach they easily made up for lost time and now have one of the top ten eCom sites. So, I wouldn’t count them out or underestimate them. BUT, this is somewhat different. Whereas eCom takes place through a simple web interface, iTunes etc. is an actual program with all that entails. They would be hard pressed to do something like that. They could license something from someone else though.
    As the article says…online sales aren’t that big yet, they have time to wait and see. I don’t think they could beat Apple with all it has though.

  2. It’s hard to be insulted by someone that can’t spell.

    But you’re right, Janus is coming… watch out. Millions of music-lovers are just waiting to be duped.

  3. [Wait until later this year and iTunes will be a dinosaur]


    [But you’re right, Janus is coming… Millions of music-lovers are just waiting to be duped.]

    NeverBuyApple folks are forever chastising the ABMers, while waiting interminably for Blimpy and the Brain’s third try at yet another new scheme to take over the world.

    Why are there those who think that it’s best that only M$ make computer stuff?

    What do WE gain, if M$ becomes the only CHOICE?

    Why is M$ the only company entitled to financial success or industry recognition?

    Any answers?

    (BTW, be careful of giving answers like: “What, should Apple have 89% marketshare instead of Microsoft?” You can’t ‘appear’ to be a humble MicroSoft supporter, while GLOATING that M$ has 89% marketshare!)

  4. Unfortunately the obstinate ignorance of a large percentage of the populace and their obvious willingness to accept any shite M$ chooses to spoon feed them does make me nervous. I have LOTS of windozer friends who have never heard of iTunes when I mention it to them (or if they have heard of it a lot don’t realize even yet that it will run on windoze). The sad truth is that for a large percentage of Windoze users the first they will hear of online music purchases is when M$ starts to cram it down their throats.

    Hopefully ITMS will be able to weather the storm and come out on top. The HP deal will help on this and M$ choosing a rental system should help out too. Anyway it will be very interesting to see how things shake out once M$ enters the fray. Hopefully Janus will turn out to be another Microsoft Bob.

  5. its my prediction that browser-based music sites will fail. People want integration between the program they are playing their music on and the store they buy it from.

    The crappy part about Echo and other browser-based sites is that they are (would be) limited to just IE. That cuts out the segment of geeky and tech-savvy people that would makeup the initial customer base.

    Now, how to unlock the safari browser that is built into iTunes so I can use safari on windows… ?

  6. MIDF — MyCrapSoft Intelligence Distortion Field [a.k.a. MindF*ck]. Using Windoze makes you so dependent (and grateful) for the constant patches that you completely overlook the fact that the crappy sieveware is responsible for all the problems you’re having with it.

    “Patch successfully installed.” — Thank you MyCrapSoft — “Downloading patch … Installing patch … Patch successfully installed.” — Thank you MyCrapSoft — “Downloading patch….”

    All the accumulated bad Karma from screwing small software companies and putting software engineers out of work has come back to haunt them. It wouldn’t surprise me if these guys are helping / encouraging the kids behind the scenes to do it. As for the adware and spyware, blame shortsighted bloatthink for leaving all those ports open so Big Brother can screw with your system by remote.

    I’ve always thought that the 1984 commercial was spot-on. Yeah, coming soon… Janus in Uranus. Get your passports ready!

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