Wednesday, September 26, 2007

Amazon Launches Its New Digital Music Store -- Hoping Its Not a Jungle Out There

After long last -- literally years of anticipation and internal consideration -- Amazon yesterday launched its new digital music store called Amazon MP3 with 2.3 million available tracks. Amazon's critical differentiator from Apple's iTunes store is that all songs available on Amazon MP3 are, in fact, in the unrestricted MP3 format. Customers, therefore, can burn purchased tracks on multiple CDs, can play them on virtually all portable devices (including, but not only, the iPod), and can copy them onto multiple CDs. Amazon also is undercutting iTunes on pricing -- individual songs cost $.89 (rather than iTunes' $.99), and individual albums sell for $5.99-$9.99.

Amazon MP3's major hitch is that music from two of the major record labels -- Warner Music Group and Sony BMG -- cannot yet be found on the new service, since these two record labels have not yet agreed to sell their music in the unrestricted MP3 format. And, apparently, even Universal Music and EMI have made only parts of their catalogs available for sale without DRM (digital rights management).

For these reasons, at least at launch, many customers of the new Amazon MP3 store likely will be frustrated during their purchase experience and simply will not return. Apple's iTunes need not worry ... yet ....