Apple (Nasdaq: AAPL) is still the king of music retailers, but Amazon.com (Nasdaq: AMZN) is gaining ground. According to market researcher NPD Group, Amazon slid into a second-place tie with Wal-Mart (NYSE: WMT) in the first quarter of 2010.
The reason? According to NPD's Russ Crupnick, Amazon's "dual-pronged approach" of selling both digital music and physical CDs -- something iTunes can't do.
The iTunes store accounted for a leading 28% of all music that U.S. consumers bought in the quarter. But while iTunes' share of the digital-download market hasn't grown appreciably over the past year, AmazonMP3 notched a 4-percentage-point gain.
Does iTunes have a potential threat on its hands? Can Amazon hope to gain in the long term from sales of CDs, which are increasingly losing their relevance? Let us know what you think in the comments box below.
