Pepsis promotion is back this year on a much bigger scalebut with the star wattage provided by Justin Timberlake instead of Green Day, and Amazon in place of Apple. The switch is an indicator of the tension between the music industry and Apple. Pepsis earlier ad, set to Green Days version of the song I Fought the Law, prodded music fans to quit pirating music online and instead buy songslegallyfrom Apples then-fledgling iTunes. Four years later, iTunes is the biggest digital music store, and the industry is taking a liking to Amazons rival music service.
Though iTunes blazed a trail in encouraging fans to pay for music online, record executives complain that Steve Jobs, Apples CEO, wields too much clout in setting prices and other terms. At issue now is whether the labels can popularise a more industry-friendly service and accelerate the pace of digital sales.
Behind this strategy is a growing desperation: sales of digital albums and songs are rising far too slowly to offset the rapid decline of the CD, the industrys mainstay product. CD sales slid 19% last year; after adding in the 50 million digital albums sold last year and counting every 10 digital songs sold as an album, overall music sales were still down 9.5%, according to Nielsen SoundScan.
In trying to nurture Amazons service, the four major record companies have offered it one potential edge. One by one, they have agreed to offer their music catalogs for sale on the service in the MP3 format, without the digital locks that restrict users from making copies of the songs.
All companies except the EMI Group require Apple to sell their music wrapped in digital rights management software, or DRM, which is intended to discourage copying. Consumers say DRM creates confusion, like a lack of compatibility between songs and the devices sold by Apple and Microsoft. In February, Jobs had called on the industry to drop its long-standing insistence on the use of the software, saying it had failed to rein in piracy.
NY Times / Jeff Leeds