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AC/DC is bypassing Apple

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It would appear to be a small thing. The band AC/DC will bypass selling songs [subscription required] on Apple's (NASDAQ: AAPL) iTunes and has cut a deal with Verizon (NYSE: VZ) to market its music on the cell service's handsets.

The band's label, Columbia Music said that the deal offered "a fantastic new high-tech platform" for music according to The Wall Street Journal. That is code talk for saying that the record companies are sick of Apple beating them up and taking their lunch money. They want alternative digital outlets so that they can eventually get better deals to sell their music through iTunes.

While the music companies are unlikely to loosen Apple's grip on digital music downloads, it is the one vulnerability that Apple's iPod profit structure has. The iPod sells because it is cool, well-priced, and is so easy to use that it can be operated by a chimp. But, the company hegemony has allowed it to dictate prices to an industry that is already in trouble because CD sales are dropping every day.

AC/DC may be nothing other than an aberration. Or, it could be the beginning of a little trend.

Douglas A. McIntyre is a partner at 24/7 Wall St.

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Last updated: November 10, 2009: 10:37 AM

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