ECON 1 Lecture Notes - Lecture 15: Cd-R, Trade Secret, Protection Mechanism
Document Summary
The music stores initially created by the record labels only carried music from those labels. This meant that consumers would likely have to visit multiple music stores to purchase the range of music desired. Furthermore, since consumers are often not versed in which labels produce the music of a particular artist, consumers may have had a hard time figuring out where to purchase a desired album or song. Apple launched itunes after striking with the major 5 labels. Itunes was launched with the initial catalogs of 2m songs for the purchase of 99% per songs. Tutorial 7 immediate signs of success with 50m downloads in the first year with quickly becoming leading online music distributor. Factors which led to the success of itunes: Cool image of apple was attractive to the recording industry & to users also. Format used was the familiar format which offered the attractive price tag for online music & the agreement of licensing.
