Amazon lays down 29p download challenge

AMAZON today sparked an online price war with Apple after dropping the price of its top music downloads to 29p.

It hopes to attract customers away from Apple, which charges 79p per track on average.

Amazon, which began selling books online, has made over 100 tracks available for 29p include Lady Gaga's Poker Face, and Lily Allen's The Fear. The company has also added rock, classical and jazz tracks to the promotion.

Experts today said the move could spark an online war.

Apple is believed to control more than 70 per cent of the download market, and has sold more than six billion songs around the world in its six-year existence.

In Britain, individual tracks are sold for 59p, 79p or 99p with the majority costing 79p.

"This is really the first serious competitor to Apple's dominance we've seen," said Tom Dunmore of gadget magazine Stuff.

"I think this could see the start of a price war, and Apple maybe forced to counter with its own promotions. Overall, this is great news, as consumers are only going to see prices drop." Amazon, which launched its rival service last year, now has over five million tracks in its catalogue. In the US the firm has also started selling electronic books, and launched an e-book reader called Kindle.

"Our aim is to always offer the lowest prices and the most comprehensive choice,' said Julian Monaghan, head of music buying at Amazon.co.uk. "Since our launch four months ago, we have been presenting our customers with some great deals on MP3s whilst rapidly expanding our catalogue and we will continue to do so going forward." Amazon.co.uk has also been offering albums for just £3.

Amazon downloads will be playable on iPods and iPhones.

Mr Dunmore said that Apple's software would also give it an advantage. "Apple really does make it easy to buy music, from the same software you use to organise your iPod, and that gives it a huge advantage."

Both Apple and Amazon face competition from online sites which allow users to stream music to their computers without having to buy tracks. Sites such as London based last.fm and Spotify have proved extremely popular although they are only usable with an internet connection.

Price comparison

Apple iTunes Music Store - 79p
Amazon MP3 download store - 29p
7Digital.com - 79p
Play.com - 65p
HMV.com - 69p

Costs of one download of Lady GaGa's Poker Face, the current UK No1 single.