Wednesday, May 12, 2004
Wal-Mart Offers Cheaper Music Downloads
Posted by Kent Pribbernow in "NEWS" @ 08:00 PM
"Wal-Mart recently launched its own online music downloading service at www.walmart.com. Buying from the discount king may not offer the cool cachet of using Apple's superslick ITunes store, but the lower prices--per song as well as per album--can add up over time. To compare, we tallied up the cost of buying the songs and albums of Johnny Cash, our favorite man in black."
Ah! A price war. But will Apple try to compete? I doubt it, and this illustrates the Achilles heel of Apple's business model: customers are locked into iTunes. As an iPod user, you don't have the luxury of choosing a different online music service. And, in this case, you also do not receive the benefits of competition. While Wal-Mart lowers its prices, Apple remains steadfast. Although the difference in pricing between iTunes and Wal-Mart (a mere ten cents per track) is hardly a gulf, it could be harbinger of things to come. If Napster, BuyMusic.com, and MusicMatch follow suit, will Apple continue to remain firm on its pricing?
Ah! A price war. But will Apple try to compete? I doubt it, and this illustrates the Achilles heel of Apple's business model: customers are locked into iTunes. As an iPod user, you don't have the luxury of choosing a different online music service. And, in this case, you also do not receive the benefits of competition. While Wal-Mart lowers its prices, Apple remains steadfast. Although the difference in pricing between iTunes and Wal-Mart (a mere ten cents per track) is hardly a gulf, it could be harbinger of things to come. If Napster, BuyMusic.com, and MusicMatch follow suit, will Apple continue to remain firm on its pricing?
