Amazon's new music service... rotten for Apple?

So Apple looses some of the measly 900-and-some million dollars they've made on the iTunes store in the last 4 years. Boo hoo. They'll still sell iPods, and that's where the real money is. This is only good for Apple.

Please, this is most likely good for Apple. Everyone is ignoring the 100 million iPods out there. That's where Apple makes the most money. It's been 5 years, and no one has made a competing player that can match the simplicity of the iTunes/iPod paradigm. Some people may move to Amazon, but it still helps Apple by pushing for no DRM. I doubt this will give the music companies the leverage they want. And even if it does, I think it will only apply to pricing, at the expense of DRM. Apple will still come out ahead with the best player and store in the market.

A couple of days is not quite enough to find out which service is going to be the ultimate winner if there is to be just one. Give it six months to a year.
Let's hope it's music lovers that are winners. Healthy competition could be good for both services and purchasers alike.

Apple is primarily a computer company. When they invade the world market with exclusive contracts that kick-back 30% and sell an estimated 2-million computers per quater all this sub-dollar music talk will be like a fox nipping at the bears heel. AAPL will run like RIMM did last year. remember back to last year about this time when RIMM was about $70 remember when it reported earnings last fall --- with $14 trillion world-wide waiting to jump into the market ---APPL is headed over $300

They said the same thing about virgin online, buymusic.com, walmart, napster, msn music, rhapsody, yahoo, emusic, etc...

Why don't any of your experts ever mention the field of fallen competitors around before they declare ITunes doomed?

EVERY SINGLE ONE claimed to be cheaper than iTunes. *sigh* Do you really think anyone will notice there's an Amazon music store?

I think you are being foolish. Amazon is not some run of the mill music shop. Amazon is huge. 100 times bigger than all the other 'fallen' music stores combined. Also, Amazon has a good reputation for quality service. My grandparents order off Amazon but they wouldn't touch iTunes with a 10 foot pole. Shopping at Amazon is like shopping at Wal Mart in real life. Its well known and simple to understand.

Amazon will succeed where the others have failed. iTunes should be afraid indeed. However, Apple as a whole will be fine. People will still buy iPods to play the music they buy off of Amazon. =)

Amazon + cheap + DRM FREE! = Win

It's as simple as that.

I'm being foolish? Amazon is 100 times bigger than YAHOO, Microsoft, and Walmart? Combined? Do you mean by market cap? Web hits? Amount of music tracks?

Reputation for quality service? Is that the dealbreaker for you and your grandparents when shopping for music tracks for under a dollar?

Do you and your grandparents also have long conversations about DRM as well? Mine don't, sadly.

There is no pent up demand for an alternative music store that will have millions defecting from Apple. (except perhaps for your legion of grandparents obsessed with reputation and drm-free music that must be 11 cents cheaper than the competition) To be perfectly blunt, the reason why Apple has so many music sales is because there is only one piece of software that syncs to ipods- itunes. There is only one store that is searchable via itunes- the itunes music store.

And much like other analysts to predict the death of the Itunes music store, have you or your theoretical grandparents actually bought any tracks from the Amazon store?

If so, where did you find the cheaper tracks? Everything I looked at was .99 cents. Have you even bothered to look at the store before you declared Apple in jeopardy? Or do you just prefer the Amazon brand over the Apple brand without actually having to buy anything in comparison?

What nonsense people talk about Apple.

It has no need to go fighting over commodity priced music for heavens sakes.

iTunes is what matters, the song sales were just to make sure the world wasn't going to end up with junk Microsoft DRM everywhere.

Please do a bit more work, you self described "experts".

This whole affair reminds me of someone's parents (Amazon, Walmart, Record Company Execs ) trying to hang out & be like the kids (Apple & Target Consumers). Sounds like a good idea to the parents, but the kids can smell the stink a mile away.

Fact is, many of these cash heavy, but idea challenged companies have tried to jump in after sniffing the wind to see which direction they SHOULD HAVE gone in, (about a light-year ago), but their mind numbing and unsustainable, "lowest price wins," oriented cultures stifle any creativity or real competition. True, they'll make some "me too," money, but not a trend or pop-cultural shift.

The kids are alright.

Thanks for listening,
August

I think Amazon will definitely the biggest competitor. Most of the other failed competitors, they had DRM on their music and with the similar quality as iTunes only. But Amazon's music is DRM free and high quality (256). It's also for both parties (Windows Media Player and iTunes). Furthermore, Amazon has a small application that can transfer the music you bought directly to your iTunes music collection. It will attract customer to give it a try.

Since Amazon already has a lot registered customer, people who already have Amazon account could give it a try easily. No need to give out additional information like all other failed competitor.

I don't know how Amazon make money right now as the price is so low. I think it's temporary for attracting new customer. Let's wait two or three month to see how it goes.

Tom,
For the life of me, I do not remember hearing of the Rafi Mohammed before in any prior discussion about Apple, the music business, hardware or software sales or pricing strategies in those industries.
So I looked him up and found this man has a wealth of knowledge in finance and eeconomics. He's written many books, given many lectures, teaches as a professor, is a Director of a business school and runs a company that is a consultant to the e-commerce industry.
Here's my point...he's not equipped to understand the marketplace he's talking about, he's not in the computer industry, he's not in the music industry, he's not in any industry.
Having said that, perhaps, we shouldn't give his or your opinions much mind at least until you've accomplished something in the industry you write about.

There is a market for Amazons service. It would be nice if they tightened up the user interface. It seems that they have a great deal of "noise" (graphically speaking) on the music pages that should not be there. Apple's interface is noticeably much tighter and smoother. Not all music is less expensive from Amazon. Take a look at American Pie for instance. For me, the shopping experience is important. To save a $1 for ten songs simply isn't worth the change. Other people may differ.