A commercial on this year's Super Bowl will promote free music downloads from Amazon (NASDAQ: AMZN)'s new MP3 store. The company has lined up the four largest record labels to offer music without digital rights management. Apple (NASDAQ: AAPL) only has a similar relationship with one -- EMI.
According to The New York Times, "Consumers who buy Pepsi drinks will receive points that can be redeemed for music downloads at a special section of the Amazon site. Amazon and Pepsi, a brand of PepsiCo (NYSE: PEP), will give away up to a billion songs."
The deal may be born from the music industry's hatred of Apple as much as from any love for Amazon. Industry estimates indicate that over 70% of all song downloads come from iTunes. That puts Apple in a position to dictate pricing and revenue sharing to the major music labels. With CD and physical album sales falling, that leaves music publishers in a bad position.
The dark side of the alliance with Amazon is that it has to work well. If music companies fail in their attempt to get around Apple, they may have to come crawling back to be "friends" with Apple again. That set of meetings may not go well.
Douglas A. McIntyre is an editor at 247wallst.com.
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