Amazon's key weapon in cloud music wars: Lady Gaga, price

Amazon's key weapon in cloud music wars: Lady Gaga, price

Summary: With Amazon's Kindle, likely tablets, streaming video and cloud music the company is grabbing everyday users. If Lady Gaga and a 99 cent album is what it takes to acquire customers Amazon will take that loss leading bet all day.

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What do you do if you're Amazon and you have to dent Apple's iTunes juggernaut and its upcoming launch of its cloud music service? Compete on price---early and often.

That's what Amazon is doing in spades today. Its 99 cent one-day offer for Lady Gaga's new album is exactly what it should be doing if it's going to grab some of Apple's market share. And guess what? You fork over 99 cents. You get Lady Gaga's album, which I had no intention of buying until it was 99 cents. And you get 20GB of Amazon's cloud storage.

Meanwhile, you may stick around despite a few server glitches. You may even stick with Amazon's Cloud Player and buy more storage in the future.

Amazon has the scale to do loss-leaders. This move, much like its free video streaming for Amazon Prime subscribers, gets people in the door. The end game for Amazon is to get you become more of an everyday user. Today, Amazon's customer base is highly transactional.

Peter Fader, marketing at professor at Wharton, lays out Amazon's challenge in a Knowledge@Wharton article:

"Amazon isn't part of your daily life. Consumers touch Google, Microsoft and Apple all the time. They are only reaching out to Amazon when buying something. Amazon wants to be a part of people's lives multiple times a day."

With Amazon's Kindle, likely tablets, streaming video and cloud music the company is grabbing everyday users. If Lady Gaga and a 99 cent album is what it takes to acquire customers Amazon will take that loss leading bet all day.

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Topics: Software Development, Amazon, Browser, Hardware, Mobility, Storage

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12 comments
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  • RE: Amazon's key weapon in cloud music wars: Lady Gaga, price

    I'm not much for her myself, but I'll buy it for 99 cents for my kid to get that 20GB free storage.
    AttackComputerWhiz
    • RE: Amazon's key weapon in cloud music wars: Lady Gaga, price

      @AttackComputerWhiz I believe windows skydrive offers 25GB free storage without purchasing anything.
      logic103
    • RE: Amazon's key weapon in cloud music wars: Lady Gaga, price

      @AttackComputerWhiz Ditto.. well the way I see it anything you buy that cheap is going to be junk. Personally I'd rather pay a slightly higher price and have something halfway decent to listen to...but those days are long gone aren't they. <a href="http://organiclotiononline.com/best-natural-lotions">best natural body lotion</a>
      Venkeen
      • RE: Amazon's key weapon in cloud music wars: Lady Gaga, price

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        martyi
  • Amazon's offer is for U.S only

    I live in Australia and this offer (Lady Gaga "Born this way" album for 99c) is for the U.S only. Amazon have a lot of U.S only offers so why would I want to be part of a cloud I can't access?
    tomthetester
    • RE: Amazon's key weapon in cloud music wars: Lady Gaga, price

      @tomthetester oh come on, you know "rest of world" means nothing to these behemoths - even Apple constantly screws us over on price and availability. I realise it's not *always* their fault - the recording and film industries are as much to blame for insisting on geoblocking/region locking but at the end of the day a digital file doesn't cost more to send to someone in SanFran as Sydney.
      artywah@...
  • Long live competition

    Should Apple sign the last of the media studios to their distribution lock-down ... it will be like Christ opening the fourth seal and unleashing the Four Horesman of the Apocalypse upon the music loving world.

    Long live competition!
    jacksonjohn
  • RE: Amazon's key weapon in cloud music wars: Lady Gaga, price

    on Sunday at 9 in nyc at Theater for the New City for the Lower Eastside Arts Festival is
    "Lady Gaga s Guidebook for Living"
    by playwright Larry Myers
    free!!!1
    dramaman
  • RE: Amazon's key weapon in cloud music wars: Lady Gaga, price

    Yes, Lady Ga Ga rocks. Her HBO special was awesome.
    james347
  • Where is the news about Amazon's servers ...

    ... having a hard time handling the demand for a single album.
    wackoae
  • It is neither Lady GG nor price...

    What it is is the fact that I can get music that can be played on my computer, burned to a CD or played on my MP3 player or Droid without some asinine DRM scheme interfering with my ability to use what I paid for. I would probably be willing to pay more for that.

    I would not buy a Lady Gaga album at any price. In fact, if they announced it was free I would still not download it. Now, if they offered to pay me....well it would have to be enough to make it worth my time...and I still would not actually listen to it.
    cornpie
  • RE: Amazon's key weapon in cloud music wars: Lady Gaga, price

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    martyi