“Tesco is to start selling iPods as part of its expansion into the lucrative digital goods market, it announced today. The move will put the supermarket in competition with electronics-only chains. It is part of Tesco’s plans for its non-food sector which last year saw a 17% sales increase, with home entertainment sales up 20%,” Louise Barnett reports for Press Association News. “The UK’s lucrative MP3 market grew by 400% last year and is expected to double in 2005, the retailer said.”
“Digital products will be stocked in 200 Tesco stores [across the UK] by the end of next week, with MP3 players available in 69 of those… Shoppers can also download music online at Tesco.com,” Barnett reports.
Full article here.
MacDailyNews Take: Tesco seems to know that every iPod they sell will be one more potential customer Apple’s iTunes Music Store and one less potential customer for their Tesco music download store. Tesco’s FAQ states, “Most portable music players support the WMA Codec. Music downloaded from this site is encoded in WMA format. To ensure that your player is compatible with Windows Media Player, look for the Microsoft Windows Media logo on the box, or within the instructions for the player. Unfortunately Apple’s iPod uses an encoding format that is unique to Apple and the iPod. Therefore the Apple iPod does not directly support transfer of files in WMA format downloaded from this site.”
By “most portable players,” we assume Tesco is referring number of also-ran brands and not the market-dominating Apple iPod lines which have easily sold “the most” units, by a very wide margin, of any portable player.
The accountants have determined they can make more margin selling the boxes than bytes. Strictly business.
one days, i want go to ingland. I hear clock big ben, study in school.
It’s cold there, boi. Not too sure you’ll like it.
The beer tastes good though. and there’s plenty of footie
MW – Zipper as in better use that zipper on your anorak, cos it’s mighty chilly
Quite funny reading this as i’ve been involved on the Technical Side at Tesco choosing which MP3 players and Cameras to sell. Apple was my first suggestion to the buyers.
Can someone explain something to me. Is it true that Apple will not allow anyone else to sell fairplay DRM base music? I can’t imagine that Tesco wouldn’t seel music formatted for the iPod if they could. What’s up with that anyway? Can you not license the fairplay DRM/AAC format? If this is the case, is Apple not simply acting like Microsoft?
Lets see, sell lots of iPods and make money, or sell few WMA players and maintain an expensive web site that sells tunes to a small market with many competitors. I believe Wal-mart came to same conclusion.
Back in the early 90’s, I had a CD from a group named Senseless Things called “The First of Too Many”. The last song on the disc is “Fishing at Tescos”, and I remember half-wondering what does Tesco mean.
Now I know.
It was a good album, if you like that sort of pop-punk sound that Green Day and Blink-182 popularized later on.
Not that this has much to do with Apple or iPods…
“Is it true that Apple will not allow anyone else to sell fairplay DRM base music?”
Yes
“I can’t imagine that Tesco wouldn’t sell music formatted for the iPod if they could.”
Agree
“Can you not license the fairplay DRM/AAC format?”
Only if Apple decide they want to license the format.
“If this is the case, is Apple not simply acting like Microsoft?”
YES. Apple is in business to make money for shareholders, just like Microsoft. Difference is, Apple has not used power of monopoly to force the consumers to choose Fairplay/AAC.
“Most portable music players support the WMA Codec.”
70% of the market would like to disagree with that statement.
Did the brits change the definition of the word ‘most’?
They meant most ‘models’.. not most units..
“… Apple has not used power of monopoly to force the consumers to choose Fairplay/AAC…”
Granted.
However can people license Fairplay/AAC? Is the only reason other player makers are choosing WMA is that MS licenses it?
Well I suppose every little helps.
Mike:
The quote above doesn’t say, ‘most units’. It actually says, “most players”. I understand your point but you misquoted. And to be accurate, Tesco’s comment is correct.
They make no reference to market share [and why would they in that context?]
next…minimacs?
Tesco is rapidly becoming the Wal-Mart of Europe, with the stated mission of ensuring that no UK consumer is ever more than 10 minutes away from one of their outlets (be it a Tesco Express convenience store to a full Tesco Extra hypermarket).
They are also aggressively pursuing opportunities both in the emerging economies of Eastern Europe as well as South-East Asia.
There is some statistic that £1 out of every £3 spent in a UK supermarket is spent in a Tesco, so I wouldn’t be too dismissive about the scale of this opportunity from Apple’s perspective.
MCCFR
—
You can imagine how many people must have asked..”What? You don’t sell iPods!?”
They didn’t do this because they ‘saw the light’ they did it because enough customers bitched them out, probably.
MCCFR – I think it is that one out of every eight pounds sterling spent UK wide goes through Tesco. It’s quite scary really.
jackson:
I think both stats are actually true, given Tesco’s market share of the supermarket sector, but your figure is also another one that’s been quoted recently.
mike, on panther:
This is a newish thing for Tesco, although I’ve been in one of the pilot stores for this move. The key thing is it moves Apple product front and centre into the public gaze as opposed to having to go to a) an Apple dealership or the sole Apple store in the UK or b) go to a branch of John Lewis which is Apple’s more upscale department store partner in the UK.
I’m not sure there was any bitch-slapping going on, just a realisation on Tesco’s part that iPods are worth selling and a realisation on Apple’s part that Tesco is as good a place as any to take a couple of hundred pounds of someone’s money.
Ahhh Tesco…
Whenever I’m in London, I always have to stop by a Tesco and pick up some Cheese Wotsits and some Prawn Flavored Savour Snacks (Which I think are now called Skips)…
Now I’ll have another reason to stop in!