Amazon to Open Music Download Store

Online retailer on Wednesday confirmed rumors that it plans to open a music download store to compete with Apple's iTunes. Unlike competitors, however, Amazon will only sell songs in the unprotected MP3 format.

Amazon says it will offer millions of songs on the as-yet unnamed service, which come from 12,000 record labels. Most of these will be smaller, independent labels, as EMI is the only major to have agreed to license its tracks without digital rights management.

"Our MP3-only strategy means all the music that customers buy on Amazon is always DRM-free and plays on any device," said Amazon CEO Jeff Bezos. "We're excited to have EMI joining us in this effort and look forward to offering our customers MP3s from amazing artists like Coldplay, Norah Jones and Joss Stone."

With Amazon on-board the DRM-free movement, it could persuade other major labels to follow EMI. Both Universal and Warner have said they are testing unprotected songs, but are wary of piracy that could come about from users openly sharing the digital tracks they purchase.

Because it has chosen MP3 as the format, songs from Amazon will be compatible with almost every digital music player - from iPods to Zunes to Zens. Although Apple plans to offer DRM-free songs from EMI at a slight premium -- $1.29 compared to $0.99 -- the files will be in Apple's AAC format, which is not supported by many players.

Still, that may not be enough to pose a serious challenge to iTunes, say analysts.

"If Amazon can offer a greater catalog than Apple at a lower price point or higher quality bit rates, we might begin to see iPod users begin to use the Amazon offering over iTunes but unless there's a marked differentiation, it's not likely that iPod users would go to Amazon over iTunes, especially given the iTunes eco system of music, TV shows, movies and games," remarked Jupiter Research vice president Michael Gartenberg.

Amazon expects to launch its music download store later this year, but did not provide a specific date.

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