A recent report by NPD Group concluded that the iTunes Music Store is responsible for 70% of the legal digital music downloads, while its major competitor, AmazonMP3 is responsible for 12%.  Other services such as Napster and Rhapsody account for remaining percentages each holding about 1% to 2% of the market.  When the Amazon MP3 store launched back in 2007, it looked promising, they were the first legitimate online music store to offer DRM free MP3 downloads, but the selection was still limited.  Nonetheless, their software which allowed customers to easily download music and import it directly into iTunes was killer.  It is probably one of the best features of their downloader.

Fast forward about a year or two, AmazonMP3 continues working with record labels to offer exclusive discounted sales of hot albums amongst other things.  Their pricing is better too.  Apple moved to that tiered pricing structure a while ago, which made more popular songs $1.29 instead of $0.99.  Amazon on the other hand have stuck with their $0.99 platform and their discounted albums.  In fact, right now, Amazon is offering a number of hot albums for $5.00.  While Apple does offer 256kbps AAC files which are superior in terms of quality when compared with Amazon’s 256kbps MP3 files, most people wouldn’t notice the difference.  So which store is better to get your music from?

Lately, it would Apple is using their typical approach, offer (perceived?) better value, for a price that is relatively the same.  For example, the iTunes Music Store will usually have bonus tracks which wouldn’t be available on AmazonMP3 or elsewhere.  Apple now also bundles the liner notes with the purchase of many full-length albums.  And lastly, their most recent attempt to offer more value – iTunes LP which includes exclusive video footage, clips, and and the album all bundled together nicely.

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AmazonMP3 doesn’t have this luxury, but they do have something else that Apple doesn’t have.  The ability to sell the actual album in a CD form, whether or not that’s a true advantage depends on the customer.  I do however know that there are still people out there who prefer to have a physical CD.  I, too, occasionally like to have the actual thing.  But when it comes to bonus tracks, nicely bundled packages, etc. Amazon isn’t as fortunate.  Though I did recently notice they are now able to offer some video content too, but it’s not nearly as plentiful as it is in iTunes.  The only Amazon can truly compete on is price and it doesn’t seem to be enough.

A major reason the iTunes Music Store is so popular can be attributed to the iPod.  Apple spent a lot of time in the early days of the iPod to make sure an iTunes install disk came with every iPod.  iTunes is now an essential application to have installed on your computer, not to mention if you ever installed QuickTime, I’m sure you had the option to install iTunes too and vice versa (you need QuickTime to use iTunes).  Maybe the next Amazon device after the Kindle should be an MP3 player – it might help their music download sales (it probably would).

Which service do you use to download music – iTunes Music Store, AmazonMP3, or Other (if other, which one)?


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