INTERNET | 06.09.2011

German consumer electronics giant challenges iTunes

 

Media-Saturn wants a piece of online music sales

German electronics retail group Media-Saturn has launched a new Internet music service that will compete with established online music shops like Apple's iTunes - as well as CD sales at its own physical stores.

 

Long concerned about cannibalizing the sale of music CDs in its many stores, Europe's largest consumer electronics retailer, Media-Saturn, has decided it can no longer sit on the sidelines and watch online platforms like Apple iTunes and Simfy erode its market share without a contest.

At the IFA consumer electronics show in Berlin, Media-Saturn launched Juke, a new online music store that will allow customers to access up to 13 million songs and listen to them on their PC, notebooks, tablets and smartphones.

Songs from the cloud

Juke is a streaming service. Users connect to the Internet and stream music to their devices in much the same way listeners of Internet radio access songs from cloud computers. Customers of the streaming service can listen to music as long as they have a subscription, available for 9.90 euros a month.

Metro CEO Eckhard Cordes approved Juke even though it could hit in-store salesBy comparison, iTunes sells music in the form of downloads, which users buy, store on their devices and can listen to as long as they wish.

Media-Saturn is not the first - nor will it be the last - to offer a streaming service.

Napster, which pioneered online music sharing, offers a similar music streaming service for the same monthly subscription fee with access to about 15 million titles. Other key players in the music streaming segment are Simfy and Musicload Nonstop, which is owned by Deutsche Telekom.

Music streaming in demand

The German music industry association sees significant potential in the music streaming business moving ahead. According to a recent market study by the association, online music retailers including Napster, Musicload Nonstop and Simfy saw sales rise by more than 20 percent in the first half of 2011, compared to the year before.

But streaming sales are still small at 14 million euros last year, compared to 204 million euros in music downloads and 1.28 billion euros in music CD sales, according to the association.

Media-Saturn's move into online music sales comes just months after the business unit, a subsidiary of Germany's Metro Group, announced its expansion into online sales of consumer electronics products.

Author: John Blau
Editor: Sam Edmonds

 

 

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