Digital Audio Insider -- the economics of music and other digital content

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Digital Audio Insider is David Harrell's blog about the economics of music and other digital content. I write from the perspective of a musican who has self-released four albums with the indie rock band the Layaways.

My personal website has links to my LinkedIn and Google+ pages and you can send e-mail to david [at] thelayaways [dot] com.

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June 01, 2011

Amazon MP3's $3.2 Million Customer Acquisition Experiment
by David Harrell

Apple's seamless integration of software, hardware, and content (iTunes and the iTunes store, iPods and iPhones, and iTunes downloads) is often cited as the reason for its continued dominance of the digital music market. Yet this advantage is more one of perception that reality -- you can easily configure your settings with Amazon MP3 and eMusic to have downloads automatically appear in your iTunes library. I'd even argue that purchase process with Amazon MP3 is faster and more streamlined than with iTunes.

But a large percentage of digital music purchasers probably don't realize that Amazon MP3 and other digital retailers are viable alternatives to the iTunes store. (Some might not even know that you can play content purchased elsewhere in iTunes and on iPods!) Last week's 99-cent special for the new Lady Gaga album was an obvious attempt to reach those consumers.

Amazon MP3 moved approximately 440,000 digital albums at that loss leader price, which, according to Billboard's Glenn Peoples, cost Amazon about $3.2 million, as it paid the full wholesale price on each of those albums to Interscope/Universal Music Group. The question is, how many of those purchasers were first-time Amazon MP3 customers? After you've made your first purchase, any subsequent purchases are much easier, as you've already created and configured your account. Assuming that enough of last week's sales were to first time customers, I predict we'll see several more 99-cent album deals over the summer for other big-name releases.

tags: digital music Amazon MP3 AMZN Apple AAPL iTunes

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THE LAYAWAYS

Out Now -- "Maybe Next Year" -- The New Holiday Album:

"This is a sweet treat, deliciously musical without being overbaked for mass media consumption." -- Hyperbolium

"Perfect listening to accompany whatever holiday preparations you may be making today." -- Bag of Songs

O Christmas Tree - free mp3 lyrics and song details
Away In A Manger - free mp3

Download from eMusic, iTunes, Amazon MP3, or Bandcamp. Listen to free streams at Last.fm.

"...about as melodic and hooky as indie pop can get." -- Absolute Powerpop

"Their laid-back, '60s era sounds are absolutely delightening." -- 3hive

"...melodic, garage-influenced shoegaze." -- RCRD LBL

Where The Conversation Ends - free mp3
January - free mp3
Keep It To Yourself - free mp3

Download from eMusic, iTunes, Amazon MP3, or CD Baby, stream it at Last.fm or Napster.

"The Layaways make fine indie pop. Hushed vocals interweave with understated buzzing guitars. The whole LP is a revelation from the start." -- Lost Music

"Catchy Guided by Voices-like rockers who lay it on sweetly and sincerely, just like Lionel Richie." -- WRUV Radio

Silence - free mp3 lyrics and song details
The Long Night - free mp3

Download from eMusic, Amazon MP3, or iTunes, stream it at Last.fm, Napster, or Rhapsody.

"These are songs that you want to take home with you, curl up with, hold them close -- and pray that they are still with you when you wake up." -- The Big Takeover

Let Me In - free mp3
Ocean Blue - free mp3

Download from eMusic, Amazon MP3, or iTunes, stream it at Last.fm, Napster, or Rhapsody.

More Layaways downloads:

the layaways website