AfterDawn: News

Virgin Records will launch VirginDigital.com on Monday, a new online music download service that will not sell tracks at a specified price (like 99c a track at iTunes) but will offer a subscription based service instead. A premium service will be offered soon for people who wish to download songs to their portable audio devices the company has said. This move will put Virgin in flood of competition that hit the digital music download market over the past year, including companies like Apple, Microsoft and Sony.

Virgin will be the first major music retailer to enter the market so far. Apple Computers currently is dominating the market having sold about 125 million tracks, and recent launches, including one by eBay make way for a serious battle which will decide what services will survive. This does not scare Zack Zalon, president of Virgin Digital however. "Two or three years out, subscriptions will overtake a la carte because it is a much more interesting proposition, it has just been difficult to articulate to consumers what it is." Zalon said.



The difficulty in explaining subscription plans to consumers is exactly why Apple decided not to make iTunes a subscription based service. "Consumers have been buying music for 50 years," said Eddy Cue, the vice president of Apple in charge of its iTunes online music store. "They want to replicate that experience online." Apple may consider a subscription service in the future however.

Sources:
International Herald Tribune
Milwaukee Journal Sentinel

Written by: James Delahunty @ 26 Sep 2004 20:45