Apple iTunes Gift Cards

[MacRumors]

iPodLounge posts a photo of new iTunes Gift Cards which will be available at Target stores.

The cards are expected to go on sale as of February 15th. Based on the photo provided, it appears the $15 card will allow customers to purchased 15 songs from the iTunes Music Store.

Napster had previously launched similar Pre-Paid song cards -- also available at Target.

[wordmunger]

Very cool. Another way for non-cc holders to get iTunes. I think my 12-year-old son would be very interested in these.

[jcshas]

my wife works for the company so I wonder if the team member discount applies?

[brossow]

Kinda interesting, and it's not a HUGE deal, but with the gift card you're paying a penny more per song PLUS whatever your local tax rate is. Nice to have the option, though.

[iggyb]

Originally posted by Macrumors

The cards are expected to go on sale as of February 15th. Based on the photo provided, it appears the $15 card will allow customers to purchased 15 songs from the iTunes Music Store.

Wha? Does this mean that tax is waived when you use these gift cards?

[Bilvox]

notice the timing... supposed distribution come the 15th... and apple.com is pushing the ipod as a "love-day" gift.
ahh those folks at apple have it all planned so well. ;-)
-bilvox

[BlingBling 3k12]

Originally posted by iggyb
Wha? Does this mean that tax is waived when you use these gift cards?

I don't pay tax on Pepsi's iTunes winning codes, so I would guess this is the same way. Plus, you're probably gonna get tax charged on it at the register.

[kuyu]

My local grocer, Kroger, sells the napster cards. I assume they will also sell these itunes cards. A good idea for gifts, and parents who don't trust their kids with the cc #.

[iKenny]

As long as Apple keeps up the intense marketing push it's got going right now (I've noticed the iPod+iTunes tv ads are back on, along with the print ads and the Pepsi promotion), it can keep its position as the dominant music store. Just keep getting the name out there; eventually this won't be necessary, but with the flood of new stores they have to make sure absolutely everyone knows about iTunes.

[Lanbrown]

Originally posted by brossow
Kinda interesting, and it's not a HUGE deal, but with the gift card you're paying a penny more per song PLUS whatever your local tax rate is. Nice to have the option, though.

And Apple makes less money with them as well. Target isn't selling them for free, so they get some money, add in the distribution, printing and insertion into iTMS. Apple is using this as another avenue to get people to spend money at the iTMS. Convenience items are usually more expensive anyway.

[michaelrjohnson]

all i can say is that this is a very good thing for apple. branching out thier marketing strategy, especially with a retailer like target (now known for being hip and stylish, as well as budget-oriented) improves the image of iTMS and apple in general.

things are looking bright for apple!

[wordmunger]

Originally posted by iggyb
Wha? Does this mean that tax is waived when you use these gift cards?

Actually, I suspect you pay tax when you buy them. Just a theory anyway. Also for some reason I haven't been charged tax on iTunes lately.

[Grimace]

This is a great thing for Apple. It adds depth and breadth to accessability to Apple products.

[yoman]

Originally posted by wordmunger
Actually, I suspect you pay tax when you buy them. Just a theory anyway. Also for some reason I haven't been charged tax on iTunes lately.

ah because the tax bill is hidden and is accumulating. Come next april you will be surprised to notice a $10 tax fee per song plus interest since purchase date.

[JGowan]

Nope... no tax. It's just like any other gift card you buy... you buy a $20 gift card and you pay $20.

Now, when a person USES the card, the tax comes out of the card or out of their pocket if they exceed $20.

But, I guarantee you that the purchaser will not pay the tax FIRST at the register for the cards.

----------------

11 songs x 99¢ = $10.89 + 90¢ TX = $11.79.

Apple charges you TAX when you ACTUALLY BUY something.

[Le Big Mac]

Originally posted by JGowan
Nope... no tax. It's just like any other gift card you buy... you buy a $20 gift card and you pay $20.

Now, when a person USES the card, the tax comes out of the card or out of their pocket if they exceed $20.

But, I guarantee you that the purchaser will not pay the tax FIRST at the register for the cards.

But if you get 15 songs for $15, then you do avoid the tax. It's not like a calling card, where after 14 songs you won't have enough for the 15th.

As for Apple losing money on this, remember that they pay a credit card fee now, and they avoid that. So there are savings as well.

[formatc]

The card is a loss leader.

Loss leader: A retail item advertised at an invitingly low price in order to attract customers for the purchase of other, more profitable merchandise.

And that more profitable merchandise is?

The iPod of course.

[Snowy_River]

Originally posted by iggyb
Wha? Does this mean that tax is waived when you use these gift cards?

Only if you pay tax when you buy the card. If you were to have to pay tax both when you bought the card and when you downloaded the song, then that would be double taxation, and that's illegal.

However, here's an interesting thought, what if Apple has decided to pay the tax for us? Some people are saying that they're not paying tax anymore... I'll have to try it...

[jholzner]

Originally posted by Snowy_River
Only if you pay tax when you buy the card. If you were to have to pay tax both when you bought the card and when you downloaded the song, then that would be double taxation, and that's illegal.

However, here's an interesting thought, what if Apple has decided to pay the tax for us? Some people are saying that they're not paying tax anymore... I'll have to try it...

They were charging me tax when I first stared using the iTMS...but they've stopped...not sure why but I'm not complaining.

[ccuilla]

ABOUT TIME!

When I saw the Napster ones at some gas station, I thought it was a brilliant idea and that Apple BETTER get going doing the same thing. Mindshare!

They NEED to squeeze and squeeze the life out of WMA. The MS crowd will NOT give up easily. But make it so that no one can profit from selling (only) songs and very few companies will be willing to lose money just for MS.

[ccuilla]

I hope the iTMS gift cards are racked up sitting right next to iPod displays at the Target stores.

Apple could really do something cool like an "iTMS within a store" kiosk-ish thing. Listen to sample songs. Get a free iTunes CD (save the download). Selling iPod accessories right there too. Etc.

[coolsoldier]

This is good for Apple's mindshare, because anything in a store is an impulse buy. You can buy an iTunes gift card at Target with a lot less thought than it takes to actually download iTunes, register, type your credit card number, and so on.

I'm not sure about the tax, though. I've paid my local 9 cent sales tax on every iTune purchased so far, as recently as February 8. Maybe some states just don't charge tax on downloads?

[dukemeiser]

Originally posted by jholzner
They were charging me tax when I first stared using the iTMS...but they've stopped...not sure why but I'm not complaining.

Same here. I thought it was because Apple had to have a physical presence in my county. Every other month I have to re-validate my card and the Music Store always makes a big deal about what county I'm in.

[the_mole1314]

Anyone else think this would be cool to throw into frozen pizza boxes and stuff? Not a $15, but mabey a $5 one. It's a good way to get iTunes recognition to a level of check-out lane aquantancy.

[Trowaman]

Originally posted by the_mole1314
Anyone else think this would be cool to throw into frozen pizza boxes and stuff? Not a $15, but mabey a $5 one. It's a good way to get iTunes recognition to a level of check-out lane aquantancy.

Mmmm, I'd go more along the lines of Pizza Hut, Dominoes, Papa Johns. Fresh, piping hot pizza with iTunes gift certifacate attatched to the box.