Even the most technologically inept individual can probably tell you the No. 1 e-commerce site for music downloads. iTunes has become synonymous with digital music, and the iPod is everywhere. A question most people won't be able to answer is: Who's number two? Well, Nate Anderson at arstechnica has a long entry about eMusic's rise to the No. 2 spot.

When comparing iTunes and eMusic there are few similarities, and a number of glaring differences. iTunes sells individual song downloads, eMusic sells unlimited downloads as part of a monthly subscription. iTunes distributes music from the major labels, eMusic distributes music from indie music labels. iTunes delivers the music in a DRM-laden format with limited portability, eMusic delivers the music with no DRM at all. The similarities: they both sell digital copies of music, and both of their products can be played on the iPod, far and away the most popular MP3 player on the market.

When eMusic remade itself (after being taken private by Dimensional Associates, the New York-based private equity arm of JDS Capital Management) some key decisions precipitated the rise to No. 2: They focused on a market, men from 25-54 and went with a format which allows playback on any platform, including the iPod. The thing that makes them a strong No. 2, lack of DRM, is also the company's Achilles heel. The studios won't sign over the rights to their material to be sold as digital copies with unlimited portability. The good news for eMusic is that the Indie labels -- who don't suffer the same piracy-phobia as the big boys -- account for 30% of music sales, so the market is large, and they're positioned to dominate it. — Brian Ward

Go to story from arstechnica

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