Site's download prices inch up as songs gain popularity

When three roommates at Brown University decided to start a music download Web site, the first thing they resolved was what it would not be like.

There would be no free file-sharing, which can raise legal issues, but also no fixed corporate pricing, which can scare off cash-strapped students. Instead, the three carved an unusual path down the middle, with a site called, part of a wave of companies both large and small that have tried to establish themselves in the lucrative digital music market.

Amie Street's solution is a plan where songs start as free downloads and then inch their way up in price as they get more popular, to a cap of 98 cents per song, based on the number of downloads. recommending music and offering song reviews, members can also earn credit toward purchases.

The effort is aimed at solving the issue of variable pricing, which record labels have advocated but music site operators &

most notably Apple &

have resisted. But it also comes with risks that have sent big companies such as Microsoft and MTV back to the drawing board as they try to capture market share in a field dominated by iTunes and file-sharing sites such as Limewire.

"It's a fascinating and interesting concept," said David Card, a senior analyst with JupiterResearch in New York. "The idea that you would have a simple and low-price system makes tremendous sense."

But that doesn't mean it will work, he said.

Amie Street's catalog doesn't include songs from major record labels, which means the latest Coldplay or Britney Spears tracks won't be available, though the site's operators say they are in discussions with major labels. Instead, Amie Street offers tracks by independent artists and sells music without the copyright restrictions common on other sites.

The field is rife with competitors, all looking to differentiate themselves. Rhapsody, for instance, offers shoppers several ways to get music, including a monthly subscription that allows song rentals. EMusic also uses a monthly subscription model that offers discounted purchases from independent labels.

Amie Street doesn't even register on Nielsen/NetRatings list of top 40 music Web sites. And it is competing for an audience that already has free options or with sites that boast bigger libraries.

The site was named after Amy Street, a road in Providence, R.I., where founders Joshua Boltuch, Elias Roman and Elliott Breece &

all 23 &

shared a house while attending Brown University. In a year's time, it has grown from about 100 songs to "hundreds of thousands" across a diverse mix of musical genres, Boltuch said.

"We wanted to include the people who are getting music through peer-to-peer networks and not paying anything," he said. "Every other online store excludes them because they put a price on music. Things need to start free so people who are into finding free music &

we call them crate diggers &

will have that opportunity."

The project has attracted support from online retail giant Amazon, which invested an undisclosed amount of money last month. Amazon has said it will launch its own music download site this year that features songs without copyright restrictions.

Card said he was watching the Amie Street flexible pricing as an experiment that could potentially expand to other music sites.

"In an online environment, it's way easier to do that than it is in the physical world," where CDs are priced with stickers, he said. In retail, "it's harder to manage that kind of flexible pricing."

Record labels would also like to see some flexible pricing, Card said, but they have been unable to convince industry leader Apple, which stands by its price of 99 cents per track and has even broken off partnerships with companies rather than compromise on pricing.

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