Amazon Readies Simple, Integrated, MP3-Based Entrance

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Amazon is readying an MP3-based download offering in May, though its approach may lack the sizzle some are hoping for.

According to numerous sources within the organization, as well as executives involved in negotiations with the etailer, Amazon will not launch a stand-alone music store in the image of iTunes.  Instead, sources to Digital Music News noted that MP3s from participating artists will be blended into the larger, existing Amazon store.  “They are not trying to replace iTunes, iPod, Zune, whatever,” one source said. “It’s going to look just like Amazon does today.”  That means that a search for an artist will yield a number of results, including CDs, merchandise, DVDs, and MP3s if available.  And, if major labels opt not to license their tracks in the open format, the ecommerce giant has decided not to wait.  “They are utterly, unflinchingly confident that they have 100 percent of the leverage in this situation,” one source flatly stated. “They are not waiting for the [major] labels at all”.

Over the past few years, Amazon has been considering a broad range of music ecommerce possibilities.  In earlier discussions, sources confirmed that meetings had occurred with numerous portable MP3 manufacturers, and most recently with MP3-based independent retailer eMusic.  All of those discussions fizzled, leaving Amazon with a solution that plays with, instead of against, the dominant iPod+iTunes ecosystem.  Instead of competing with iTunes, Amazon will encourage users to incorporate their downloads into the Apple store, and transfer tracks to their iPods.  “Stick with iTunes, but buy from Amazon,” one source quipped.  Meanwhile, multiple sources also pointed to an approach that includes variable pricing, though the store will insist that providers sell in the MP3 codec.  It remains unclear if Amazon will require providers to offer tracks in a uniform bitrate, or if songs must be sold as unbundled, a-la-carte downloads.  The bitrate detail is critical for EMI, which is readying a DRM-free play with Apple that features higher-quality – and more expensive – songs.