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Article

Title: Can Anybody Catch iTunes?

Author: Smith, Ethan Article Type: Product Analysis
Source: Wall Street Journal, v248 n125 pR1(2) Publication Date: Nov 27, 2006
  ISSN: 0193-2241
URL of Publication: http://www.wsj.com

Several rivals of Apple Computer Inc. are trying to create their own spaces in the digital music market. Microsoft Corp., Yahoo! Inc., and Napster Inc. would like to attract individuals who have not yet signed onto Apple's iTunes digital music service. These companies would like to lure people who are not comfortable downloading music or those who are accustomed to getting their music at no charge from illegal sources. Apple's competitors are taking several innovative approaches. Yahoo! is attempting to integrate its music service with the devices people already have, such as cell phones. Napster's efforts involve getting customers with free, advertising-supported versions of its subscription services. With iTunes already having 72 percent of the online music market, it represents the fourth-largest music retailer. Its closest rival, eMusic, has only ten percent of the market, and other companies' market penetration is at the single-digit level. Apple also dominates 75 percent of MP3 player sales with its popular iPod mobile device. One company can afford to make a direct challenge to Apple, and that company is Microsoft. Microsoft has sufficient funds and an historical rivalry with Apple. The firm is currently involved in a direct assault on iTunes with its Zune, a product Microsoft characterizes as 'a software and hardware ecosystem' that can compete with the synergy existing between the iPod and iTunes.

Companies:
Apple Computer Inc Microsoft Corp

Products:
iTunes Zune

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