This article was first published on 2007-06-23. Due to the age of this article, it is included here for archive purposes only.
NPD Group released it’s latest ranking of music retailers and Apple has passed Amazon, moving up from 4th place to 3rd place. In first place at 15.8% is Walmart followed by Best Buy with 13.8%. Apple comes in 3rd with almost 10% and Amazon follows with 6.7%. Apple had previous lapped Target in sales. Apple is the only one of the three selling on digital downloads. The others sell primarily CDs.
What this means for you and I is that Apple has more bargaining power with the labels when it comes to things like getting rid of DRM, interoperability, and iTunes exclusives.
It also means that they have more power to balance Walmart, who is known to make demands that favor them and restrict what Apple wants to do. It should also help when negotiating pricing. The music labels have made it clear they would like higher prices than Apple is charging at the moment.
Of course, the lables are also resentful of Apple’s growing power in their industry. They are nearing the end of their initial agreements with Apple and are looking for some room to negotiate. This doesn’t bode well for one of them walking away from the table with Apple.