LA Times: Microsoft, Yahoo!, AOL, Amazon Looking To Move In On Music Services

by , 12:00 PM EDT, June 10th, 2003

The L.A. Times has published a very interesting story about Apple's iTunes Music Store (iMS), and the heavyweight competitors looking to muscle in on Apple's newly created space. According to the paper, Microsoft, Yahoo!, AOL, and Amazon are all working on competing services that could come online by the end of the year. Similar stories have been published of late about Microsoft, Amazon, and AOL, but the Times' story offers much deeper details, and includes a lot of commentary from industry execs. From the L.A. Times:

Microsoft Corp., Yahoo Inc., Amazon.com Inc. and AOL Time Warner Inc.'s America Online unit are among the companies expected to launch services to compete with Apple's 6-week-old iTunes store, which charges 99 cents to download a song onto a personal computer. Viacom Inc.'s MTV, another popular Web destination, is also exploring a download venture, according to sources.

The arrival of these Internet heavyweights marks a dramatic shift for the five major record companies. For more than a year, they have unsuccessfully tried to thwart widespread piracy by drawing fans to their own Web music services. Now they are placing their hopes in established Internet companies with their built-in audience of tens of millions. Music executives hope the new players will help the industry reverse its sales slump.

"I think the whole thing is a revolution," said Doug Morris, chairman of Vivendi Universal 's music operation, the world's largest. "Yahoo has an enormous number of people coming through all the time. Amazon sells a ton of content. MTV certainly is an enormous bull's-eye for people who like music. This is an amazing moment."

[...]

Microsoft has recently shown its version of a downloadable music store to executives at several record companies. Sources said Microsoft plans to give consumers more music-related information to guide their purchases than the iTunes Music Store does, and that its store might be accessible via Xbox game consoles as well as computers. Microsoft officials declined to comment.

Bill Wilson, general manager of AOL Music, said his company plans to launch a store "along the lines of what Apple has done" by the end of the year. He said the AOL Time Warner-owned Web service, which has 26 million subscribers, would integrate the sale of downloadable songs into the full range of music-related activities on the service.

Other areas of interest covered in the full article include comments from Yahoo! about trying to grasp the business model of online music sales, comments about Apple's own business model, and information about the failure of previous recording industry-backed services. We recommend it as a very interesting read.

The Mac Observer Spin:

Look for a full editorial from TMO on the subject later, but the short version now is that we will believe that companies like Microsoft can get online sales right when we see the company do it. The same goes for Yahoo! and AOL if they rely on Microsoft technology, while Amazon could get it right no matter which technology they pursue. When it comes to Amazon, the company has proven it knows how to sell online. See our previous commentary on the benefits to Apple and Amazon both, if they teamed up on a co-branded service.

L.A. Times Article