Wal-Mart Takes On Apple, Round 2


Wal-Mart got into digital music late, made absolutely no impact, and was promptly forgotten about. It’s  worth looking at again: The retail giant is going to sell DRM-free tracks from both Universal and EMI, something no other store can currently offer. There are plenty of ways for Wal-Mart to screw this up, of course. But if they don’t, they may finally provide what the music business has been begging for — a well-financed rival to Steve Jobs and Apple.

EMI already sells DRM-free tracks via Apple’s iTunes, while Universal just announced it would begin selling DRM-free tracks through pretty much anyone but iTunes. But Wal-Mart is the first retailer to offer DRM-free tracks from both labels. Just as compelling is that Wal-Mart is undercutting Apple on price. It will sell the tracks for 94 cents — that’s 5 cents less than a conventional iTunes song, and 35 cents less than what Apple sells a DRM-free song for.

We still think the appeal of DRM-free songs are overstated — it’s not going to solve the music industry’s problems. But they’re definitely better than the other option — crippled tracks that only work on certain players and certain devices. And they’re definitely a way for Wal-Mart to get Apple customers to switch stores — or at least take a look.

That’s where Wal-Mart needs to be careful: iTunes works in large part because it is elegant and easy. If you want a song for your iPod you select it, pay for it, and you’re done. If Wal-Mart can’t match that — and as many have proven, matching Apple’s UI is much harder than it looks — they’ll be hard-pressed to keep customers at any price. And their store will immediately be crippled by the fact that Warner Music Group and Sony-BMG aren’t selling their music sans-DRM, which means customers will face a confusing patchwork of prices and use restrictions. But if Wal-Mart, Universal and EMI can prove that it works, Sony and WMG will be hard-pressed not to follow suit. Release after jump.

Universal’s DRM Drop: Just An Apple Negotiating Ploy
The Mythical DRM Cure-All
Universal DRM Deal Follow Up: Google Gets Into Music, DRM-Free Tracks With Strings Attached

Wal-Mart Launches MP3 Music Download Tracks

All MP3 digital tracks only 94 cents, with music content from major record labels such as EMI Music and Universal – available now at Walmart.com ( <http://www.walmart.com/> http://www.walmart.com) BRISBANE, Calif., Aug. 21 /PRNewswire-FirstCall/ — Wal-Mart (NYSE: WMT) announces the launch of “DRM-free” MP3 music downloads, now available online at  <http://www.walmart.com/> http://www.walmart.com. At only 94 cents per track and $9.22 per album, the new MP3 digital format delivers value, convenience and the ability for customers to play music on nearly any device, including iPod(R), iPhone(R) and Zune(TM) portable media players. Wal-Mart is one of the first major retailers to offer MP3 digital tracks with music content from major record labels such as Universal and EMI Music. “As we consistently strive to help our customers shop smart at Wal-Mart, our new ‘DRM-free’ MP3 digital tracks give them the ease and flexibility to play music on virtually any device at a great value,” said Kevin Swint, Wal-Mart’s senior director and divisional manager for digital media. “Also, we’re excited to launch our MP3 catalogue with major record labels such as Universal and EMI Music that includes music from popular artists like The Rolling Stones, Coldplay, KT Tunstall, Amy Winehouse, Maroon 5, George Strait and Nelly.” Wal-Mart’s new MP3 music catalogue includes hundreds of thousands of songs and albums, and will be continually expanded with additional mainstream and independent music content. Also, Wal-Mart is currently offering special MP3 album pricing on hundreds of album classics such as Come Away With Me by Norah Jones, Be Here by Keith Urban and Barrio Fino en Directo by Daddy Yankee at $7.88 per album; and Slippery When Wet by Bon Jovi and Get Rich or Die Tryin’ by 50 Cent at $5.88 per album. Wal-Mart will continue to offer its existing WMA-format music downloads. Thus, customers may select the option of MP3-format downloads at 256 kbps for $0.94/track and/or WMA-format downloads at 128 kbps for $0.88/track. About Wal-Mart Stores, Inc. (NYSE:  <http://studio.financialcontent.com/Engine?Account=prnewswire&amp;PageName=QUOTE&amp;Ticker=WMT> WMT) Wal-Mart Stores, Inc. operates Wal-Mart discount stores, Supercenters, neighbourhood Markets and Sam’s Club locations in the United States. The Company operates in Argentina, Brazil, Canada, China, Costa Rica, El Salvador, Guatemala, Honduras, Japan, Mexico, Nicaragua, Puerto Rico and the United Kingdom. The Company’s securities are listed on the New York Stock Exchange under the symbol WMT. More information about Wal-Mart can be found by visiting  <http://www.walmartfacts.com/> http://www.walmartfacts.com. Online merchandise sales are available at  <http://www.walmart.com/> http://www.walmart.com. SOURCE Wal-Mart Stores, Inc.