Tesco Digital

Tesco has decided it wants to compete with sites like iTunes and have a slice of the mp3 business pie. Tesco already sells some downloads as a WMA file only but from next month it plans to add three million tracks for download in mp3 format. This would be the latest addition to the line of goods and services that the 'Tescopoly' sell.

It also wants to sell more than just mp3s. In addition to music that is free of DRM (digital rights management) it also wants to sell some TV shows, UK and US based. Unlike iTunes, it also wants to sell downloadable games, similar to such applications as Steam and services on the Xbox 360 and PlayStation 3 games consoles.

It is thought that Tesco, due to their reputation for undercutting the prices of competitors (and also often controversially), could offer their music at a rate lower than iTunes, who currently are the market leaders in the UK. iTunes sell music for 79p a track, but in my opinion if Tesco do undercut them it would only be by a few pence. I somehow disbelieve that music could be so low valued when you consider the many people and organisations who earn from each sale.

According to Reuters, Graham Harris, Tesco Commercial Director is quoted as saying:

"We wanted to create an exciting and easy-to-use entertainment shop that Tesco customers of all ages and technical ability can use and trust."