Amazon.com book site expands into music

The new service -- available directly from Amazon's (AMZN) main home page -- is dubbed simply the Amazon.com Music Store.

Rather than launch another brand name, the company chose to extend the Amazon.com brand to music, which is already familiar to 2 million book-buying customers, said Rick Ayre, vice president and executive editor.

Amazon is not planning its Music Store as an adjunct to the book business, Ayre said, but plans to sell more CDs than industry leaders CDNow and Columbia House.

"We'll be very disappointed if we're anything less than number one in music," Ayre said.

Paula Batson, spokeswoman at N2K's Music Boulevard, said it won't be that easy to crack the music business.

"We have a senior management team that has deep experience in the music business, and as a company our focus is music and that's what we're all about, offering music content, community and commerce. We think music buying is all about the total experience."

At launch, the Amazon.com Music Store will offer CDs only, and will not include classical titles. These will be added later if customers ask for them.

Price, price and price
Much of the focus of the store originally will be on price. Selected titles will be offered at 40 percent off list price, while the most popular 100 CDs and "hundreds" of others will be offered at 30 percent off list.

The site will also have about 200,000 song clips for customers to sample music, and 14 main music categories and 272 subgenres with which users can browse.

Rival CDNow currently has 30-percent-off specials on CDs including Samuel Barber's "Adagio," Jimi Hendrix's ""BBC Sessions" and Ben Folds Five's "Whatever & Ever Amen."

Music Boulevard also emphasizes price, stating on the home page: "Everything is on sale now."

Amazon.com will throw significant resources behind the effort. Ayre would not provide specifics, but said more than 50 people will be involved on the music side of the business.

Staffers include Senior Editor Keith Moerer, former music editor of Rolling Stone; and a group of 12 editors who have worked at Spin, Billboard, Salon, Tower's Pulse! Magazine, MTV Online, The New York Times and The Village Voice, among others.

Anthony DeCurtis, another long-time Rolling Stone and VH-1 personality, will be a contributing editor. A group of 200 contributing writers are also being recruited from publications around the country.

Editorial independent
Ayre said editorial content will be independent, and that some reviews will be critical. Reviews will also be solicited from average users of the site.

The Seattle-based company had $87 million in sales in its most recent quarter.

But with sales of recorded music over the Internet projected to rise from about $300 million this year to $2.5 billion in 2002, analysts and industry executives say Amazon.com is well-positioned to get a healthy piece of the market.

"They're going to be able to carve out a space, but I don't think they're going to take over,'' said James McQuivey, an analyst at Forrester Research Inc. ``I don't think it's going to pull the rug out from under CD Now and Music Boulevard.''

A horse race
"I think it will be a three- or four-horse race,'' agreed Vernon Keenan, senior analyst at Zona Research Inc.

Meanwhile Amazon.com is forging ahead with its expansion plans. In April, the company announced the acquisition of Internet Movie Database Ltd. as a possible prelude to online sales of videos.

John Motavalli is a freelance writer and frequent contributor to ZDNN; Reuters contributed to this report.