Wal-Mart to Launch Online Music Store

Dteyn writes "I heard on the radio today that Wal-Mart will soon be opening up an online music store to compete with the likes of Apple's iTunes and Napster. According to the radio newsguy, it's expected to be officially announced as early as next week. Looks like this 'digital music' thing is starting to catch on with the bigwigs. Finally."

Comments

Censored.

[Evanrude]

I wonder if all the songs will be censored like the CDs in the stores?

Re:Censored.

[Shakrai]

I wonder if all the songs will be censored like the CDs in the stores?

They don't censor stuff, they just refuse to carry it. Works fine for me, because I can get it cheaper at my local used music store, without dealing with the parking situation at Wally-World, and to boot, I'm supporting a local business.

I'll never forget the time they attempted to card me for buying a PG-13 movie. I've bought liquor at Wally-World without getting carded before! Guess we have our priorities for what we gotta protect the kiddies from :)

Rolling back prices...

[ForestGrump]

So will we be seeing them for 49 cents a song then?

And I can print out a coupoun for a yellow happy face with the purchase of each song online-Walmart song right?

Is the little tune they play with each commerical free download? or do I have to pay for that too?

Can I buy online and pickup the songs on a cd in the store? That would be great!

-Grump.

Too....many......music download services

[dethl]

Why Wal-Mart, why? Isn't the industry flooded enough as is? Although Wal-Mart does make enough to offset the losses it will incur with the music service (as all music services do), its just another iTMS wannabe.

Re:Too....many......music download services

[SewersOfRivendell]

more will come into the market to compete with those, on a platform that PEOPLE want, not manufacturers

Not if you want music owned by the RIAA record trust. Competition requires the availability of more than one different product in the first place, and the only product these stores can offer is DRM-encrusted. The RIAA won't be giving that up anytime soon without a revolt from one of it's multinational members.

Also makes you wonder.....

[i_want_you_to_throw_]

If they'll offer a wide range. Wal-mart tends to be somewhat puritanical on what they offer. (Marilyn Manson anyone?).
Still for mainstream music it shouldn't be too bad. Here's an older story about Wal-Mart's controls on music sales.

Will it run on thier Lindows PCs?

[RumpRoast]

Online music for Linux, maybe?

How will it make money?

[paxcirca]

I'm confused as to what Walmart's impetus here is. Steve Jobs has very clearly stated that iTMS makes about squat for profit; it's just a pretty Trojan Horse to get people to buy iPods (and eventually Macs). Walmart doesn't have an MP3 player (that I'm aware) to push. Selling music to get people to buy MP3 players seems a bit more plausible than, say, selling music to get people to buy tires/clothing/cereal in Walmart stores.

Re:How will it make money?

[SEE]

Wal-Mart has one major thing Apple doesn't:

Leverage.

Wal-Mart already sells a massive volume of music. That gives them the leverage to drive down the record company cut of sales. "I think we'll have to cut our CD pre-orders if you can't bend on your cut of the download sales" is an incredibly useful threat to be able to use at the bargaining table.

And forget just CD orders. How many of the major labels are owned by companies that sell other things retail? Sony sells electronics. Sony, Time Warner, and Vivendi Universal sell DVDs. Wal-Mart's purchasing power, as the #1 retailer in the U.S., is tremendous on those things, too.

And if Wal-Mart can just get better "invoicing" terms than Apple gets, that can make it profitable just on the interest earned on the consumer's money between sale and paying the record company.

Re:How will it make money?

[Octagon Most]

And guess what, Wal-Mart is a privately held company to boot!

I guess so, if by "privately held" you mean owned by all the shareholders that freely buy and sell WMT on the New York Stock Exchange.

Coming soon ....

[R33MSpec]

All that is left now is Microsoft's turn:

(1) Call it MS Tunester
(2) Bundle with new version of Media Player
(3) Introduce Drakonian DRM
(5) ????
(6) Profit!

And we would use it because...?

[evn]

The article is pretty vague. Wal-mart is going to start an online music store to compete with other services which have been successful. Unless they can offer something darn impressive I think they'll have a hard time getting it out the door.

Apple offers you iTunes - excellent music software that people actually want to use (just look at the number of non-US downloads for proof).

Napster 2 offers...well, it's got plenty of name recognition - the music selection/pricing scheme is a little different and the format works on a variety of players.

The other services (buymusic, napster, pressplay...) haven't had near the success of the iTMS. Unless walmart has some sort of killer feature that people are actually asking for they're doomed to be another smalltime player.

what could that feature be?
- Lossless files
- No DRM/Regular MP3
- Extremely cheap pricing ($.10 - $.50)
- EVERY major artist/song represented (and more indie tracks too)
Without one of those it's just more of the same, and there is no reason for consumers to choose walmart's startup over the much more popular ITMS or the much more established napster.

Re:And we would use it because...?

[Shakrai]

Lossless files

That would be nice. C'mon boys what is all this broadband for after all? I'd rather spend half an hour or 45 minutes downloading 650 megs of lossless music (rough guess on my 3mbit RR download) then take a trip to the store to buy a CD. And that's the worst case scenario. You could use lossless compression to cut down a 650 meg CD by quite a bit I suspect. How well does that data compress?

No DRM/Regular MP3

Not going to happen as long as RIAA controls things... any other viewpoint is naive :( Not that I don't completely agree with you...

Extremely cheap pricing ($.10 - $.50)

Of all my complaints with iTMS (mainly DRM, but also the system resource hog that iTunes seems to be), I can't argue with the prices. Sure cheaper is always better, but $0.99 is pretty reasonable imho.

EVERY major artist/song represented (and more indie tracks too)

That's the biggest thing I think. There are several of my mp3s that I've been unable to find on iTMS. C'mon, what's the Internet for if we can't have instant access to every piece of music ever created by human beings in any language?

The RIAA will never survive it.

[blair1q]

Wal-Mart has a corporate policy of beating suppliers until they relent on pricing.

Since digital music costs fractions of a penny to duplicate, the marginal cost is less than one cent, which is where the RIAA's revenue will go once they've been strong-armed by the Wal-Mart business process.

The only way Wal-Mart will not do this is if they buy the RIAA outright and use their ownership to make up "cost" numbers.

Note that this will be "passed on to the consumer" in the form of a 1% reduction in retail prices.

Related to this...

[amanpatelhotmail.com]

Yet another music service in the works?...

Just in my inbox:

--------------------
Subject: Important MP3.com Announcement

CNET Networks, Inc announced today that it has acquired certain assets of MP3.com, Inc.

Please be advised that on Tuesday, December 2, 2003 at 12:00 PM PST the MP3.com website will no longer be accessible in its current form.

CNET Networks, Inc. plans to introduce a new MP3 music service in the near future. If you would like to receive email updates on this service, including an invitation to a special members-only preview, please sign up here.

MP3.com is not transferring your personal information to CNET Networks, Inc. or any other third party.

On behalf of all of us at MP3.com we thank you for your patronage and continued support. It has been a privilege to host one of the largest and most diverse collections of music in the world. MP3.com wishes to express its sincere thanks to each of you for making us your premier destination for music online.

Sincerely,
MP3.com
--------------------

More details from the Rejected Post Machine

[securitas]

Wal-Mart, Best Buy, Comcast to Offer Online Music

2003-11-11 13:10:14 Wal-Mart, Best Buy, Comcast to Offer Online Music (articles,music) (rejected)

Wal-Mart will launch its own digital music download service through its Web site later this month. Not to be outdone, Best Buy will also launch an iTunes-type online music store - with the ability to buy through in-store kiosks - based on the MusicNow service (formerly FullAudio). And today Comcast announced music downloads via Real Rhapsody for its 5 million broadband Internet subscribers. The Washington Post's Cynthia L. Webb writes about the online music frenzy and the resultant advertising onslaught due to the sheer number of entrants into the music download market, while Bloomberg's Holly M. Sanders offers an analysis of Walmart's imminent entry into online music, which is significant since Wal-Mart already controls 14 percent of global CD music sales. More at the New York Times (via SeattlePI).

Walmart will make money BECAUSE:

[takochan]

they are very very good at putting pressure on suppliers to cut prices, because they are such a big volume seller.

They know now, that without all the distribution costs of physical media, that the 90cents / track that Apple currently pays to the RIAA, can be cut down to 50 cents or less because they know this is all just pure profit for the RIAA right now. This is all fat, Walmart knows it and they have the buyer market power to make this price cut happen.

Then they will sell those tracks to us for 60 cents, undercutting Apple, and Walmart still will make money.

This is how Walmart always does it with whatever they sell. No reason it will be any different this time.