From Market Watch:
Until this week, iPhone users were essentially limited to a single music store: Apple. The new version of Amazon’s app changes that, allowing songs and albums to be purchased and downloaded directly onto the mobile devices — a development that experts say could put pressure on Apple to lower its prices.
Although iPhone owners have been able to download music stored on their Amazon cloud accounts since last fall, that music could not be purchased with an iPhone. The new app enables users to buy music from iPhones and then play them from any Apple or Android device. As a result, “Apple will probably price-match on the top sellers,” says e-commerce consultant Brian Eisenberg. (A spokesman for Apple declined to comment.)
Amazon’s digital music prices do tend to be lower than its competitors, says Brian Colello, analyst at Morningstar. For instance, many top-selling albums are cheaper on Amazon than on iTunes. Country singer Tim McGraw’s album of “Number One Hits” costs $5 on Amazon’s MP3 store, but costs $7.99 on iTunes. British singer Adele’s album “21” is $9.99 on Amazon and is $10.99 on iTunes. “If Apple responds like others in the open market it will reduce the price of their music to compete with Amazon,” says technology analyst Jeff Kagan. “That said, Apple doesn’t typically act the way competitors do.”
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