Amazon’s managed a coup in its campaign to be the MP3-seller king of the heap by doing what Apple’s iTunes hasn’t: gotten Warner to license its tunes DRM-free. Bad enough that Amazon already sells its tunes at 89 cents – ten cents cheaper than iTunes.

Reuters reports that Amazon’s sweetening the deal with exclusive tracks as well as special packaged bundles. With Universal, EMI and Warner already peddling tunes on Amazon, it might not be long before movie studios follow suit. Movie downloads on Amazon, anyone?

Investors seem to be pleased with the deal as well. Warner Music’s shares rose 7 cents to $6.04 while Amazon’s Nasdaq-listing rose $1.38 to $94.23. No word if Apple’s shares took a hit but then they’ve had a good year, what with the stellar sales of their laptops, Leopard and, of course, iPods.

The question is whether Amazon’s success will spell trouble for Apple’s iPod sales now that DRM-free MP3s are easily available. iTunes has gotten a lot of flak for selling DRM-protected tunes, making the songs unplayable on non-iPod players. This will be the real litmus test to see if the iPod can continue selling well now other players can have easy access to legal tunes. Will 2008 be the year an iPod-killer emerges? Judging by recent iPod sales numbers (the iPod Nano topped Amazon’s 5 -10GB MP3 player category at Christmas), I wouldn’t hold my breath.

Related:

Entry was posted on Friday, December 28th, 2007 at 3:30 am under Amazon, Apple, Music.

Read more entries by Erna Mahyuni.
Stumble It!