Friday, October 12, 2007

Pointless Punditry 1: iTunes

The landscape of digital media is changing. And how can Apple react?

I bought an album from AmazonMP3 they day it went live. The store is pretty easy to navigate, and the helper app didn't get in the way, although it also didn't add the album to iTunes as promised. But hey, its Beta, right?

Oh, and Amazon is cheap! "A Revision" is $9.99 on Amazon and $20.64 for the partial album on iTunes. "The Wall" is $8.99 on Amazon and $16.99 on iTunes

Now, I suspect the low prices on Amazon are part of a bait and switch. The Labels are giving Amazon lower wholesale prices now to help build interest, and they will raise prices later. But they have to at least appear price competitive. So, if I can save money at Amazon, and I can get the songs on my iPhone (or any device), why would I buy from iTunes?

Now we have Radiohead selling their albums on their own. And Madonna .. signing with a tour promoter? The point is: the industry has figured out that -- today -- if they want their efforts to succeed, they have to be interoperable with the iPod, which means either sells through iTunes, or go DRM-free.

When the majority of legal consumer downloads are DRM-free, it's going to change the ahrdware landscape, as well? Why not buy an iRiver something-or-other, if it can play most of what I bought from Apple, Amazon and eMusic?

So, back to Apple. What is my uninformed, unsolicicted advice? Make iTunes a platform. Turn it into a frotnend for any music store willing to build to particualr APIs. iTMS, Amazon and Ma & Pa Indy Records can compete side-to-side in the same app. Make it easy to compare prices between stores. Some stores may have rewards programs, while others give you a discount for annual membership (are you listening, Costco?). Apple can take a small cut from each transaction .. 1 or 2%. Or heck, just make money off search (it works for Firefox ... and Safari). In the end iTunes can be the easiest way to shop multiple vendors for music, and load it onto an iPod. Or any device? Is that a bit too ambitous?

Now, this goes against the "own the ecosystem" ethos of Apple, and maybe for goiod reason. Apple has tight control on the user experience which makes it, for the most part, not a total headache.

It is obvious that the music labels, movie and television studios resent having to go through Apple to get to the consumer. They'll keep trying (unsuccessfully) to avoid the iPod. But as they realize that DRM-free doesn't mean profit-free, We'll see Apple's influence wane. Unless Apple can get ahead of the curve.
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