Despite its standing as an Internet bellwether, Amazon.com Inc. typically has shunned making large acquisitions, preferring distribution deals or small investments to outright buys. True to form, Amazon has invested an undisclosed amount of money in digital music company Amie Street Inc. in a Series A round of financing. New York-based Amie Street provides an interesting twist on music sales — its customers influence the price other customers pay for downloaded songs. All songs on the site start at a price of 0 cents. But as more people download a song, the price rises, capping at 98 cents, or 1 cent less than Apple Inc.’s iTunes service. Users receive credits for the purchase of additional music by recommending songs to their friends. Artists are paid 70% of song sales. Amie Street bills itself as “the first digital music store propelled by social networking,” and with Amazon behind it, its chances for survival look a lot stronger today. —David Shabelman

See Aug. 6 Amie Street press release
See February 2006 story in TheDeal.com

Tags: Amazon, Amie Street, vc, venture+capital