Wal-Mart selling music online, cheap
Posted on Wednesday, August 22, 2007
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Stories pertaining to Wal-Mart Stores, Sam's Club, or other related Wal-Mart coverage from the Northwest Arkansas Democrat-Gazette.
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Wal-Mart Stores Inc. ’s online division began offering cut-rate digital music downloads Tuesday that will play on multiple devices, including iPod, iPhone and Zune media players.
The MP 3 digital tracks significantly undercut download prices on Apple Inc. ’s online iTunes Store.
Both services offer downloads free of programming that limits play of the music tracks to specific devices.
That programming, called digital rights management or DRM, is aimed at preventing duplication of songs that would violate copyright laws, and which potentially costs the music industry billions of dollars in sales.
“We definitely believe that the MP 3 format, without DRM, takes down barriers,” Kevin Swint, Wal-Mart’s senior director and divisional manager for digital media, said in a telephone interview.
Downloads are available at the company’s Web site, www. walmart. com, at 94 cents per track or $ 9. 22 per album. Music by recording artists from two of the four biggest record labels, Universal Group and EMI Music Group, is available.
Swint said Wal-Mart, based in Bentonville, is in discussions with the two other big players, Sony BMG Music Entertainment and Warner Music Group.
Also on Tuesday, RealNetworks Inc., Viacom International’s MTV Networks and Verizon Wireless announced a digital music joint venture to provide consumers access to downloads from their computers, portable music devices or mobile phones. Rhapsody America, a newly formed company, will operate the service.
Some of the Wal-Mart downloads will be edited, as are the company’s in-store offerings, he said. If a recording is issued with a parental advisory, Swint said, Wal-Mart sells the edited versions provided by the music labels.
And don’t bother to try downloading from a Macintosh computer, according to Wal-Mart’s Web site. It says Windows 2000 or XP is required and broadband Internet service is recommended.
Apple spokesman Tom Neumayr declined to comment on whether Apple would match Wal-Mart’s prices. Apple’s iTunes Store offers DRM-free downloads at $ 1. 29 per track.
Wal-Mart says its service includes hundreds of thousands of songs. Apple says it has more than 5 million.
David Card, a New Yorkbased senior analyst with Jupiter Research, said the move by Wal-Mart, the world’s largest retailer, will push the envelope on digital music downloads.
“Clearly, Wal-Mart is a huge player in CD [compact disc ] sales, so they know how to play music,” he said in a telephone interview.
Wal-Mart sells more compact discs than any other retailer. Card said CD sales in the United States total about $ 11 billion a year, versus $ 1 billion for digital downloads.
However, CD sales have been falling since 1999, he said, while download sales are rising.
Card said offering digital music DRM-free is “the right thing to do,” despite the risk that the material can be copied. He noted that CDs and DVDs — digital video discs — work in all brands of players.
“The thing is, nothing can stop piracy,” he said.
A Dallas-based public policy research group, the Institute for Policy Innovation, issued a report Tuesday that said piracy of recorded music costs the U. S. economy more than $ 12. 5 billion and more than 71, 000 jobs each year.
Bartlett Cleland, director of the institute’s Center for Technology Freedom, said new laws or regulations are not the answer, even though Wal-Mart’s move might worsen the piracy problem.
Instead, he said, the emphasis should be on the economic damage caused by stealing intellectual property, and that copying music is stealing. Mark Rein, director of Acquity Group, a Chicago-based e-commerce consulting group, said Wal-Mart’s move could be significant if handled right. “That’s the kind of thing they need to drive traffic to their Web site,” he said. “I think it’s going to draw a very specific demographic to their site if they’re successful in marketing it.”
To contact this reporter: spainter@arkansasonline. com
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