Amazon’s 99-Cent Lady Gaga Album Heralds Cloud Music Wars

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As if it weren’t enough of a reason to freak out that Lady Gaga’s much-anticipated album Born This Way is out today–on a Monday, even though most albums come out on Tuesdays– has sweetened the deal.

Amazon’s been doing $3.99 sales on MP3 versions of selected new albums for a bit, which ensures them high placement on the Billboard charts but stresses out physical retailers. As a one-day deal, though, Amazon is currently selling Born This Way (the album, not the song) for 99 cents. By comparison, Apple’s iTunes store has the basic version of Born This Way for $11.99, and individual songs for $1.29 each.

Why would Amazon sell the biggest album of the year so far for what sure looks like a loss-leader price? One likely explanation: Apple is reportedly close to finalizing their deal with the major labels for their own cloud music service, so Amazon would undoubtedly like to get as many users on board with Amazon Cloud Player–which runs on Android, but not officially on Apple’s iOS–as quickly as possible. And they’re prominently advertising the fact that paying a buck for the Gaga album also buys an extra 15 gigabytes of storage on their cloud service for a year. (Amazon’s also selling the physical CD of Born This Way for $8, or roughly what a new LP cost in 1983. If I were running a brick-and-mortar record store, I would be tearing my hair out today.)

Of course, there are inevitable bugs. Early comments on Amazon’s site suggest that there are significant technical problems with saving Born This Way to their cloud drive–some users are reporting that only a song or two, or perhaps only the digital booklet, is showing up, or that other songs are loading very slowly. (I bought it just now, and three out of 14 songs showed up immediately on my own Cloud Drive; by 15 minutes later, it was up to five songs and the booklet.) It may simply be that Amazon’s servers are slammed, but this is a hell of a time for their service to develop glitches.

History-minded observers of the music business should note that rock-bottom pricing–specifically, the 99-cent price point–is what ended up killing the physical single in the U.S. market. Digital album prices can’t get any lower than this; it’ll be interesting to see how the Apple vs. Amazon price and format wars over cloud music storage pan out over the next few months.

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