Space Ramblings

Why Wal-Mart’s Music Strategy is Doomed

There’s no doubt that Wal-Mart is a major success. Wal-Marts exist all over America and even the world. Wal-Marts have redefined shopping and sales and for good or ill, probably ill, Wal-Mart isn’t going anywhere. But that doesn’t mean Wal-Mart is perfect. Far from it.

Wal-Mart’s attempts at international expansion have often hit land mines and road blocks. Wal-Mart’s German expansion fell apart fast for example because Wal-Mart had no understanding of how to do business in Germany. Well Wal-Mart has no real idea of how to do business on the internet. Wal-Mart’s website is indistinguishable from that of most other nationwide retail chains. Wal-Mart’s attempt at selling naked PC’s or PC’s fitted with Linux are laudable but inadequate.

Wal-Mart’s decision to sell songs minus DRM for 88 cents is getting a lot of coverage but it’s yet another dead end. The problem with selling music downloads through a website is that it’s counter-intuitive, it’s simply not the way people handle music. Ideally music downloads should be sold through a program such as iTunes or Media Player (a platform Microsoft has woefully underused). That’s why RealNetworks is positioned with real potential. Wal-Mart by contrast treats music as just another commodity you go out and buy and it just doesn’t work that way.

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