Best Buy and Partners to Rival iTunes

Dennis Faas's picture

Recently, Best Buy announced its alliance with SanDisk and RealNetworks to develop a music service set for release on October 15th, 2006. (Source:

The arrangement uses RealNetworks' Rhapsody service via the Best Buy Digital Music electronic store. The system will be available to customers of the SanDisk Sansa e200R line of Rhapsody MP3 players. (Source:

Rhapsody is currently the largest subscription-based music service, while SanDisk is the number two producer of MP3 players (falling behind Apple). The SanDisk Rhapsody MP3 players have been reported to cost $139.99 US for 2GB players and $249.99 US for 8GB players. Both models will come with a free two-month subscription to the Best Buy Music digital store. (Source:

The alliance is an effort by the three companies to create a seamless digital music system. Jennifer Schaidler, VP of music at Best Buy, described the partnership as a way to "provide an end-to-end digital music solution that will deliver unique content and a premium customer experience." (Source:

Although Apple's market dominance in the digital music industry may be a difficult mountain to conquer, Best Buy assures that there is still room in the market for new players. "It's about growing the pie altogether, and getting more people to experience digital music," spokesperson Brian Lucas has stated. (Source:

Furthermore, the alliance's new system will have a key advantage over Apple and some of its competitors; the new system allows users the choice of either a per-download charge or subscription service. In contrast, Apple only offers per-download pricing. (Source:

With a mid-October release date, the new system exploits the advantage of entering the market ahead of Microsoft's Zune MP3 player and Zune Marketplace music service, which are expected to be released before the holidays. (Source:

While the three-pronged alliance will attempt to take what they can from the pool of digital music customers, it may not be an easy task. Cracking Apple's share may be difficult enough, and the market has yet to see what impact Microsoft will make. The battle for MP3 customers may heat up in the next few months; only time will tell who will survive and who gets burned.

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