Can Tesco Topple iTunes?
News that Tesco are set to offer a revamped version of their music download service has opened up a debate about whether they can actually take a slice of the action from iTunes or is the venture doomed from the start?
While iTunes is by far and away the number one music download company in the world, Tesco is one of the leading worldwide supermarket companies, and the number one retailer in the UK by a distance. This competition between the two will be fought on very different terms with Tesco looking to use its reach and availability for their regular shoppers, while iTunes very much attracts the young ?hip? element of today.
The old Tesco music download system was very much limited in its appeal because embedded software ensured that the music could only be played on certain products and was not transferable. However, it now appears that Tesco have come to some kind of arrangement with a number of record companies to enable restriction free downloads to be sold to customers. While they are not releasing the names of the record companies in question we will no doubt be hearing from them very shortly!
The fact that Tesco are looking to use there massive exposure in the UK retail market to attack the music download sector will be something of a worry to iTunes (and owner Apple) because as we have seen in a number of other non-food ventures, Tesco have a habit of hitting the spot.
One other concern for iTunes is the fact that Tesco are very much a price related company and will be looking to instigate some kind of price war to attract both customers and the headlines. Apple have had it too easy in the eyes of many, with a number of record companies complaining about the low payments artists receive, but this may all be about to change.
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