Wednesday, March 30, 2011

"The Cloud"

According to this article on Rolling Stone's website, Amazon recently started a new project called “Cloud Player” and “Cloud Drive”, which allows music lovers to store their many files on Amazon’s servers and lets them play that music on their iPhones or iPods. This is a very ingenious idea created by Amazon, because it helps satisfy the demands of a music-lover by providing a service. The customers who load of music on a daily basis run the risk of their hard drive crashing or running out of room. So people have been demanding more computers with more hard drive storage. For Amazon, they made it possible so a person can store all of their music on the company’s servers, which helps decrease the plausibility of a hard drive crash and helps meet the demand of more space to store music. Music takes up a lot of storage on the hard drive, and by Amazon providing a very interesting type of storage as a service to help the demands of the people. Later in the article, it also states that this “Cloud Player” and “Cloud Drive” will be compatible with AAC files, which is a very specific type of media file that iTunes uses. For them to broaden the capabilities of the music-storage system to include all types of music files is a great way to help meet the demands of the people to store more music, because the demand for music is inelastic, meaning that no matter how much money a certain song costs, people will still shell out the bucks for that awesome song they heard on the radio. Amazon has a great idea going, but will it be able to survive in the ever-changing dynamics of the music business?


- Caitlin Harrington

3 comments:

  1. I believe that “Cloud Drive” is a great idea by Amazon. This new project that they are starting might attract iTunes customers. Letting consumers store their music in the Amazon server will give consumers an incentive to change from ITunes to Amazon. If Apple doesn’t do something similar, their demand for music will drop. This drop might make them lower prices in their ITunes store. It’s good that more firms are looking to start a new internet music store, this will give consumer more options to choose from and it will help regulate prices.
    -Santiago Z

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  2. This is a good idea, but is Amazon making any profit off of this? Does it cost to store music? Or is their whole purpose just to attract people to their music store?

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  3. Matt--The first 5 GB of the system are free, but then the customers have to buy an Amazon MP3 album to get another 20 GB. So yes, they are making a profit because in order for the customer to get more space, they have to spend money on the Amazon website by buying an album. It doesn't cost a regular fee to store the music, but they do have to buy a MP3 from Amazon. I think that Amazon's purpose was partly to attract people to their music store, because it shows that Amazon is willing and ready to hold your music. But as with every firm, their goal and purpose is to make a profit.

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