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The Daily Deal “hasn’t done much to weaken Apple’s grip on the digital music business. But that doesn’t mean Apple isn’t paying attention.”
——Peter Kakfa
APPLE PLAYS HARDBALL WITH LABELS OVER AMAZON DAILY DEAL
But I.B. Bad Told You That Six Weeks Ago
In his must-read Media Memo column in All Things D Tuesday, Peter Kafka scrutinized a Billboard story on Amazon’s MP3’s launch of the “Daily Deal” $3.99 album promo, requiring labels to provide the store with a one-day exclusive before street date, augmented by such digital marketing support as a banner ad on an act’s MySpace page and messages on label and artist sites and social network feeds.

Amazon’s promotion “hasn’t done much to weaken Apple’s grip on the digital music business,” Kafka wrote. “But that doesn’t mean Apple isn’t paying attention.” He then cited the bible’s revelation that Apple is pressuring labels not to participate in the Daily Deal, backing up those warnings by withdrawing marketing support for certain releases featured as Daily Deals.

In response, label executives at Capitol, Capitol Nashville and Jive reportedly opted against doing Daily Deals with Corinne Bailey Rae’s The Sea, Lady Antebellum’s Need You Now and Ke$ha’s Animal.

Other majors are following suit, according to the original story, pulling back on pre-releases and exclusives for high-profile albums, and pushing smaller artists that Apple isn’t likely to care as much about.

As Kafka noted, this week’s Daily Deal, Raheem Devaughn’s new Sony album, doesn’t appear in iTunes’ “New and Noteworthy” section—further evidence “that Apple is pushing back a bit more forcefully at Amazon,” Kafka noted. “If I’m Jeff Bezos, I’d take that as a compliment. And then I’d go back to worrying about Steve Jobs’ entry into the e-book market.”

Fascinating story, right? But for the record, our own I.B. Bad broke the news in his column posted Jan. 15. Wrote I.B.: “In what retail watchers are likening to the old days of brick-and-mortar, Apple appears to be playing hardball with labels that attempt to place exclusives on high-profile acts with Amazon MP3. Last week, the iTunes Store pulled the marketing on Katharine McPhee after Amazon put her new Verve release on sale for $3.99, the sudden disappearing act causing the album, which had been Top 10 at iTunes before the yank, to plummet. Absent from the iTunes welcome page this week are XL’s Vampire Weekend and MusicworksOmarion, Amazon MP3’s current $3.99 specials—though Vampire Weekend is iTunes’ #1 album nonetheless, with a shot at topping next week’s chart.” And that it did.

One clarification on the BB story: Lady Antebellum was a Daily Deal—but on street date. It was the featured "gold box" deal of the day, which afforded it uber-premium placement on the Amazon site—the first download to be featured as such—selling a reported 18k digi-units as a result. A source at EMI insists the company had nothing to do with this promo. For what it's worth, even with the Daily Deal, iTunes still sold four times as many albums.

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