Price wars: Celebrate with a 99-cents album this holiday season
So iTunes may have gotten the Beatles, but the battle for online supremacy in the digital downloading space is just getting started. Yes, the Apple store has a massive head start, but Amazon.com this week is taking direct aim at the spot where iTunes has shown the least flexibility: price.
Downloads of new albums from Kanye West, My Chemical Romance, Ne-Yo and Robyn are priced at $3.99, but with the aid of this handy-dandy $3 off coupon, a brand new digital download can be yours for just 99 cents. At these prices, it's almost as if music on the Internet can be had for free.
Though it's good for just one purchase, and though Amazon reserves the right to "terminate or modify this promotion" at any time, it represents a new low in the valuation of an album (there is no fine print about the deal not being utilized for sale items). It also gives Amazon a head start on Thanksgiving-weekend shoppers, committing them to a music purchase days before they would be tempted to make an impulse buy at a physical retailer this Thanksgiving weekend.
The trend at Amazon's biggest competitor -- and the world's largest seller of music -- has been the opposite. A non-deluxe edition of My Chemical Romance's "Danger Days: The True Lives of the Fabulous Killjoys," for instance, is retailing for $11.99 at iTunes.
Recent releases are getting an even bigger discount. As of Tuesday, the John Legend and the Roots collaboration "Wake Up!" is priced at $1.99 at Amazon. Over at iTunes, it's still comfortably priced at $9.99.
Apple's iTunes store, which controls about 70% of all music sold digitally, according to market research company NPD Group, has never engaged in a price war with Amazon. Pop & Hiss has put the question out to some who work in music retail and distribution, and the answer given has been consistent. The simple dominance of the iTunes store doesn't necessitate a need to lower prices they say. Amazon, however, owns a much smaller 12% of the digital download space, according to NPD, and such deals generate, well, press, as well as boost the company's market share.
On a side note, the digital editions of Kanye's album on iTunes and Amazon appear to come with the much-discussed "phoenix" cover, a piece of artwork West said was "banned in the USA!!!"
-- Todd Martens