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New policies needed for iTunes to maintain dominant download position

As Macworld begins, the Apple Corporation is facing unprecedented challenges to its supremacy in the music download market. The recent emergence of the iPod compatible Amazon download store as an entity in the real world and Universal’s refusal to renew its contract to provide music for iTunes may finally cause Apple to reconsider the way it does business with companies that provide content for its store. Though Apple still controls a solid seventy percent of the music download business and, according to Business Week, has a comparable advantage in the video download market, the company needs to rethink its policy toward pricing if it is going to remain competitive. In addition to competition from Amazon, Microsoft is convinced that its Xbox 360 has enough online services to make a significant dent in Apple’s dominance. Also, as more users move toward using their portable devices for movies and television, Apple will need the support of companies like Universal and NBC Universal to offer competitive content. Though changes are probably afoot, what remains unclear is what effect Apple’s policy changes will have for the millions of consumers chained to their iPods. [Via Business Week]