iTunes Outperforms Amazon

By Cindy Waxer December 17, 2010

Music service providers such as Amazon have a long way to go before catching up to Apple’s iTunes. According to an NPD report in WSJ, iTunes still controls 66.2 percent of the digital market while rival Amazon enjoys a mere 13.3 percent share. In fact, Apple’s high-traffic music store reaches almost 90 percent of the market on some days. Amazon, on the other hand, lays claim to a significantly smaller six to ten percent of the market.

That’s not to suggest, however, that iTunes lacks a strong competitor. Earlier in the year, the New York Post reported that Apple is in talks with major record labels to provide a subscription-based music service. Subscribers would be granted unlimited access to songs for a monthly fee, ranging from $10 to $15, depending on how much music would be included and how long consumers would be able to access the content.

Rumors have long swirled around Apple and what direction it plans to take its online music service as newcomers like Spotify flood the market. In April, Apple shut down its cloud-based Lala music service for reasons unknown, after acquiring it in December. Lala members were permitted to access their online collections until May 31, at which point Apple took the service offline completely. At the time of the Lala acquisition, Apple provided no details on the price it paid or its plans to integrate Lala into its music offerings.

Lala allowed U.S. users to stream and purchase over 8 million songs. Visitors could listen to a song once for free, pay 10 cents for a version that could be played online repeatedly or pay 79 cents or more for a copy that could be downloaded. However, Apple has long maintained that streaming music services could harm download sales

In February, iTunes’ sales tally hit the 10 billion mark. The company marked the occasion by giving the 10 billionth song purchaser a $10,000 iTunes gift card.




Edited by Chris DiMarco

TechZone360 Contributing Editor

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