Apple’s iTunes Store will dominate digital music downloads for years to come

“The convenience of one-stop impulse shopping from their iTunes music player vastly outweighs the lower prices and DRM-less features of the Amazon store. Further, Apple itself sells DRM-free music and will increasingly benefit from Amazon’s negotiations for that format. So while that vocal minority of music purists who insist on DRM-free music may flock to Amazon’s new store, they will only be helping Apple maintain its music dominance with the vast majority iPod owners and music buyers,” Carl Howe writes for Blackfriars’ Marketing.

“Amazon’s new MP3 store is great for everyone, and it lends choice to the digital music business. But don’t make the mistake of thinking that Amazon’s music business threatens iTunes dominance. Amazon’s music business will simply will put pressure on music labels to reduce their cut of the digital music distribution pie (since Amazon is undercutting Apple in price and can’t do that indefinitely) while expanding choices for consumers,” Howe writes.

Howe writes, “Meanwhile, the vast majority of consumers will continue one-stop shopping for their music, movies and TV shows in Apple’s iTunes, preferring convenience over low-prices. Amazon will fight for the number two spot in digital downloads, while Apple’s iTunes business will dominate digital music downloads — and profits — for years to come.”

More in the full article, including estimates of Apple’s iTunes Store profits, here.

27 Comments

  1. I’ll keep using my iTunes. Thank you very much. No need in downloading new apps, setting up new profiles and giving up even more credit card information to “save” 10 cents. Besides, I still like the liner notes and prefer to buy the physical media. iTunes is more than a store, it’s a media management system that’s hands down the best on any platform.

  2. Yeah, thought I might try the new service myself. So I went there last night to download Shooter Jennings’ cover version of “Walk of Life.” No chance. Yeah, they might have a few DRM-free selections, but nothing anywhere near what they’ll need to shake iTunes’ tree.

  3. “….Amazon’s music business will simply will put pressure on music labels to reduce their cut of the digital music distribution pie (since Amazon is undercutting Apple in price and can’t do that indefinitely) “

    —————

    But they aren’t…. Actually, what they are doing is exactly what the labels want, they’ve introduced variable pricing.. Haven’t you noticed the songs for $1.94? Those make up for the ones that are 89 cents. This is what Vivendi wants.. In time, you will see more and more songs at $1.94.

  4. I welcome the Amazon service. Choice and competition are always good. All these sort of articles seem to be written from the perspective that there should be only one download service – irrespective of the whole DRM issue. Personally I’ll use whichever service suits me best, is cheapest, has what I want, or any combination of those and other reasons. I may end up using one exclusively, I may not, whatever.
    I personally buy all my dvd’s and cd’s from play.com. Are they always the cheapest? No, but they’re cheap enough often enough so that their free shipping, service and the convenience of using one company (as opposed to having my card details on the server of every retailer on the planet) makes them my first stop. I also use other companies when I need to.

  5. Ive noticed the variable pricing of $1.94 on Amazon and if in time they put more songs at that price then people will just simply flock back to iTunes or torrents, the simple fact is the music labels have to do it our way or no way.

  6. I tried out the Amazon site yesterday. I already do a lot of purchases from Amazon, so I was set up – but it still took a multitude of clicks to pick up the songs. Plus, the download time was MUCH longer than iTunes.

    That being said – it worked, albeit slowly – it was easy, albeit with more clicks and the music transferred seamlessly to my iTunes.

    Competition is a good thing – it makes everybody better and sharper.

  7. Once you buy several thousand dollars worth of music and mix your playlists, you really dont’t buy much more.

    I haven’t updated my iPod in years.

    Video on a iPod doesn’t work very well, it’s better on a TV although FrontRow with remote is pretty cool to catch up on series.

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