will end its three-week “Freedom of Choice” online music promotion Thursday. Over 3 million songs were purchased during the sale, the company said.
In a move to rival Apple Computer Inc.’s iTunes service and promote its online music store and RealPlayer 10.5 software, RealNetworks last month slashed prices on music downloads to US$0.49 per song and $4.99 for most albums. That compares to the regular $0.99 per song and $9.99 per album.
The promotion has been a success, said Dan Sheeran, senior vice president at RealNetworks. “The 3 million downloads put us in a very strong number two position in terms of market share for downloads and knocks a few market share points, at least, off of Apple’s position,” he said. Apple is considered the market leader.
Apple spokeswoman Natalie Kerris offered MacCentral a statement that disputed RealNetworks’ claim of shaving market share points.
“iTunes is currently selling around [four million] songs per week and over 16 million songs per month. During the last three weeks we did not see any drop in our market share, and our sales grew each week,” said Kerris.
To keep luring customers with low prices, RealNetworks will now offer 10 songs each week that will be sold for $0.49 a track. The 10 songs will be in a list called the Rolling Stone Top 10 compiled by RealNetworks and Rolling Stone magazine, Sheeran said.
The Rolling Stone Top 10 is a combination of the most popular tracks from Rolling Stone’s charts as well as from RealNetworks’ download store and its Rhapsody subscription service. “There is going to continue to be a price incentive to come check out our store,” Sheeran said.
With RealPlayer 10.5, RealNetworks last month introduced a technology called Harmony that allows consumers to download songs they can transfer to and play on a wide variety of portable digital media players, including Apple’s popular iPod devices.
The introduction of Harmony sparked a showdown with Apple over whether RealNetworks is allowed to offer songs that can be played on the iPod. Apple even accused its Seattle-based rival of adopting “the tactics and ethics of a hacker to break into the iPod” and said it would investigate the legal ramifications of Harmony.
Nothing has come of that, Sheeran said. “We have not heard from Apple.”
Updated 11:00 AM 9/09/04: Apple’s statement added.