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Amazon into iTunes & iPod's MP3-player and MP3-service market?

Amazon.com is expected to rival Napster, Real Networks, and Microsoft by launching its own Amazon music store / service. Chances are it will even team up with an MP3 player producer for Amazon-branded device.

Enjoying a huge user base, Amazon tops 55 million users, Amazon would have a lot to gain by offering an in-house option to CD-buying, namely digital downloads.

The possibility of turning digital downloading into the second cell-phone market boom are high, considering the event of offering free brand-name MP3 players with 1year or 2year subscription contracts.

If the Amazon player goes mp3, it will have to beat the iPod - iTunes synergy. On the wma side, it will have to battle Napster, MSN, Walmart, Rhapsody, Virgin, Yahoo, and URGE. Even AAC, or ATRAC3 prove tough grounds for the Amazon mp3 player by losing the existing mp3 / wma market.

An online journal reported that Amazon.com is undergoing talks with Vivendi Universal's (Universal Music Group), Sony BMG, Warner Music Group Corp. and EMI Group Plc, to prepare the terrain for the implementation of house-branded Amazon player, alongside a digital download service.

Jeff Bezos, founder and chief executive of Amazon:

"(Amazon) is especially well positioned to capture a bigger part of that [digital download] business."

Other questions rise in the possibility of getting the CD you just bought from amazon.com available for downloading on your Amazon MP3-player; questions like what happens if you send the CD back, or if you get a discount provided you don't want the downloadable version...

Amazon.com, one of the few enduring dot-com companies, has historically concentrated on items which can fit through a standard letterbox - such as music CDs, DVDs and books (suitable for a virtual marketer), though this opportunity of breaking the physical restrictions must seem as a rather interesting choice of development initiative.