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Amazon closing gap on iTunes in actual use

updated 05:20 pm EDT, Mon April 6, 2009

Amazon catching iTunes

The NPD research group found that 87 percent of digital music buyers in the US last year used iTunes to download music, while 16 percent used Amazon's MP3 store, with some evident crossover among them. NPD's music tracking service performed the study which shows the store growing significantly faster than other iTunes competitors have in the past.

Amazon MP3 found a niche market as its audience is older overall than the average iTunes shopper, says NPD analyst Russ Crupnick. This is good, he adds, as they still tend to buy CDs and therefore aren't battling directly with iTunes. They will share some customers with iTunes, which will help the company grow.

Apple is attempting to cash in on the success of its iTunes store, as it's bumping up prices on Tuesday. Songs are priced at between 69 cents and $1.29 depending on their age and popularity, and Crupnick says NPD will watch the effect this will have on sales closely, doubting that it won't harm sales. [via CNET]

By Electronista Staff
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  1. elroth

    Junior Member

    Joined: Jul 2006


    iTunes Plus

    As of today, iTunes is all DRM-free, with all songs iTunes Plus.

    BUT - those songs that weren't converted as of yesterday have disappeared from the store. I know because I have dozens of songs in my shopping cart (waiting for iTunes Plus versions) that are now grayed out and "unavailable."

  1. Eldernorm

    Fresh-Faced Recruit

    Joined: Sep 2007


    Error, error

    Apple is not raising prices, the music studios are raising prices. Apple just charges the price to your card and is the middle man.

    Maybe people think that Apple is the music studio too. ????

    Just a thought.

  1. SlimGem

    Fresh-Faced Recruit

    Joined: Jul 2008


    Cashing In ?

    "Apple is attempting to cash in ..."

    I doubt if Apple is getting a penny more out of this. They were forced into it in order to drop DRM. It's all the big recording companies profit.

  1. luckyday

    Fresh-Faced Recruit

    Joined: Apr 2008


    You don't read?

    "87 percent of digital music buyers in the US last year used iTunes to download music". I highly doubt that the music labels are pushing Apple around. While this may have been something prompted by the recording industry, I don't doubt for a second that Apple is benefiting from the new pricing as well.

    Apple has always been about squeezing the greatest amount of profit out of smaller amounts of revenue (i.e. lesser revenues than Dell, HP, etc.)

  1. JulesLt

    Fresh-Faced Recruit

    Joined: Jul 2005


    Higher? Lower?

    I would presume that numerically speaking, we will see far more tracks at the new lower price point than at the higher price point, as this would reflect the way that the market already works.

    i.e. the prices available via emusic or Amazon for a lot of tracks are cheaper than iTunes. Older CDs are typically less than 50% of the price of new CDs.

    Nor do I have a problem with labels charging more for new releases - if they set the price too high, sales will fall. Profit is margin times sales.

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