Analyst: MySpace online music store not even a slight threat to Apple iTunes

“MySpace is going to do a digital music store. Well, sort of. Actually, it’s going to enable unsigned artists to sell songs online. That’s a logical, cool service for the thousands of bands with pages on MySpace, and for their fans. And MySpace addresses several issues that are huge challenges facing retailers trying to make a business out of a la carte downloads,” David Card blogs for JupiterResearch.

“But it’s not going to make anybody any serious money anytime soon,” Card writes.

“Yes, Virginia, there is a long tail. No, no company in the entertainment business can make a lot of money off of supporting only the tail, without also delivering the hits. And for now, no rockstars or major labels are going to be interested in unprotected MP3s, which is what MySpace will offer, except for promotional purposes,” Card writes.

Card writes, “MySpace is going to let the artists charge whatever they want. Variable pricing is not that big a deal. First, it’s not completely variable, because of that flat-fee charge — and there are no album discounts yet. But more important, according to the latest JupiterResearch (unpublished) survey results, 99 cents remains the sweetspot for what people are willing to pay for a digital single from their favorite band. In fact, a broad swath of young-ish adults, from 18 to 44, like the 99-cent price point, it’s only geezers that force the median price point down.”

Card writes, “Variable pricing for digital music is inevitable, and will ultimately be a good thing. But right now, Apple is right: simplicity is better at this early stage of the market. Oh, and if anybody was wondering whether MySpace is a threat to the iTunes Music Store — let alone the iPod — the answer is ‘not in the slightest.'”

Full article here.

Related articles:
MySpace plans ‘alternative’ to Apple’s iTunes Music Store – September 05, 2006
Attacks likely to prove futile against Apple’s iPod+iTunes de facto standard – September 01, 2006


  1. technically it might be crap…but those are a lot of pageviews…and it has been effective for quite a few bands..but they should stick to advertising. e-commerce aint gonna fly over there…hard to trust your wallet to a site that goes down whenever you breathe on it.

  2. I have heard that the whole mySpace backend is a kludge as far as the software goes. While this doesn’t matter to the people using the site, this means that trying to extend the site will get progressively more difficult to the point that it becomes impossible.

    Windows is at the point where its very hard to add functionality or maintain the code base.

    mySpace might have some initial impact – they have a good sized user base and lots of bands use their site. If they can get the architecture right, things could get interesting.


  3. Maybe is right. Even Big names use, and view it. Don’t get your heads to far up your technical rear ends. MOST PEOPLE ARE BEFUDDLED, technologically speaking.

    And they too, are right.

    Magic word= simple.

  4. These analysts are crap. Why do they think this necessarily competes with iTunes? It’s full of unsigned artists. It seems to complement iTunes perfectly. All of these unsigned artists are hoping to get signed so they can step up to the big time – iTunes!

  5. How can myspace handle music downloads? If you have ever tried to log on to their site during the evening hours you probably have found it to take a while. So, a site that cannot even handle the simple traffic of people logging into their accounts is somehow going to be able to handle the added traffic/bandwidth of a music download service. Unless they do some major upgrades on their backend it seems unlikely that they will do a good job. Not trying to speak ill of myspace but they are a bit slow sometimes.

  6. agree with you “war”..however the downloads appear to be being handled by an embedded flash app from Snocap. so in theory it’s not running on myspace servers. and also in theory, it means any Web 2.0 savvy provider can do this.

    however I did try to buy a track from one of the test artists. it appeared to work, but I never saw the MP3 or figured out how to get get it…possibly my pop up blocker blocked it. anyway the band at least got my 99 cents (actually a portion thereof)

  7. This is all good for Apple.
    Apple doesn’t really care how or where you get your mp3’s from, as long as you listen to them on a iPod.
    (iTunes is not a big income generator)

    The numbers are way over the top at Myspace.
    Apple would be smart to license it’s DRM to Myspace.

    Myspace currently provides excellent marketing capabilities to unsigned artists. The ability to have your music heard by tens of thousands of teens and build a large fan base, all from the comfort of your home is unprecedented. (no need for a smelly tour van)

    This is a smart move for Myspace and will do nothing but sell more iPods.

  8. “myspace is the only semi serious contender in the music arena to itunes, if done right the two could own the entire market”

    DBS, I would include < > in the mix, since they carry tons of signed artists on independent and smaller labels. Some of their offerings overlap with stuff on iTunes, but they do sell unprotected variable bitrate MP3s for about $0.25 each if you join, even at the lowest monthly level ($9.99/month for 40 tracks/month.) You just can’t buy a single track for a given price, and call it done. I didn’t know whether I’d like having to commit to a certain amount of $$ each month, but once I got started I found that I was just experimenting like crazy trying out music I hadn’t ever heard of. I usually download my allocation of 40 songs/month fairly early, and can’t wait for them to load me up with another 40 at the end of the month. I don’t even think about the $10 I’m parting with each month, since it’s automatically deducted.

    No, I don’t work for them.

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