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From an indie-store viewpoint, Apple's foray into digital distribution.is terrible. Some think it will be the end of time for them. Stepping back a moment to really see what has happened leads me to a different take.

GUEST EDITORIAL: RETAILER REACTS TO iTUNES MUSIC STORE

What Does the First Successful Online Music Venture Mean for Traditional Music Retail?
By Don VanCleave,
Coalition of Independent Music Stores

Wow.

One million songs purchased digitally this past seven days.

More revenue taken in seven days than in the history of all of the other services combined? I don't know if that is true—I heard it somewhere. THE topic of conversation everywhere has been Apple's foray into digital distribution. Finally, a download service that actually works. From an indie-store viewpoint, this is terrible. Some think it will be the end of time for them.

Stepping back a moment from this to really see what has happened leads me to a different take. First of all, millions and millions of songs are downloaded every day with NO currency changing hands. We should all be able to agree that our collective businesses suffer when no money changes hands. Personally, we like our label relationships, and I for one don't really want the labels to go out of business. I don't think the musician-direct-to-consumer model will sell more music than is currently sold. OK. So it makes me happy that someone finally came up with something compelling enough that customers will buy it.

Right now, retail is out of the equation when it comes to digital delivery of music. For the very, very short term, this is an Apple thing. Not all Apple people, just the very small number that actually downloaded new software in the past 11 days on top of having the newest operating system and an iPod. So, a commercial vote by a small percentage of Apple people who make up a tiny percentage of US computer users caused Apple's stock to increase $4 in less than a week. Impressive.

It is foolish to think that the market for this service will be limited only to the biggest nerds of the nerds. Many are under the false impression that these files are proprietary to just Apple. But, my understanding is that Apple is just using the international standards for the MPEG-4 AAC format. Right now, there are third-party people all over the place writing code for this thing to work on Windows. Initially, it will be Apple's store loading into PCs into a Windows iPod. But, soon, there will be tons of players out there that will accept MPEG-4 AAC files.

Once the Apple iTunes Music Store hits the PC world, I would bet that it will be huge. The early-adopter nerds are loving the one click ability to download singles and listen in 21 seconds without filling out stupid forms or having a government satellite over the house.

So the big question is, where does that leave retail? Are we able to work with Apple? Are we able to get the license for our own version of a digital music store? Can we afford it? Can we afford not to?

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