View Full Version : WSJ: Amazon Plans Music Service To Rival iPod

Feb 16, 2006, 12:02 PM

Now Amazon, the world's No. 1 online retailer, is in advanced talks with the four global music companies about a digital-music service with a range of features designed to set it apart. Among them: Amazon-branded portable music players, designed and built for the retailer, and a subscription service that would deeply discount and preload those devices with songs, not unlike mobile phones that are included with subscription plans as part of the deal.

Music executives privately welcome Amazon's plans, which they see as one of the only credible challenges to Apple's hegemony in both digital music and portable players. Now the question is whether Amazon's massive customer base is enough to offset a long delay in entering the online music business.

Unlike the other iPod killers this one seems to leverage off of an already successful online retailer, and thus has the eyeballs to potentially succeeed if the hardware they develop is halfway decent. Of course it would be best, particularly for the 10% of iPod owners who have bought their iPods from Amazon, if they could find a way to support iPods as well, like Real's Rhapsody service does. If they could find a way to effectively launch an iPod compatible subscription service before Apple, they could have a winner.

Another likely feature: the portable players would be free or very cheap with a long-term subscription -- say, a year -- similar to the way cellphone providers subsidize the cost of new handsets when customers commit to service agreements. It's possible Amazon would price the subscriptions close to what competitors typically charge -- about $15 a month -- and has said it may offer discounted CDs to subscribers.

Is this the future of what became of CD Now http://www.cdnow.com, currently Amazon's "preferred music buyers' club"?