AMAZON MP3 ADDS MUSIC AUDIO DOWNLOADS FROM WARNER MUSIC GROUP

Customers can now choose from more than 2.9 million MP3 songs on Amazon MP3, including music from Warner Music's renowned catalog of artists

SEATTLE AND NEW YORK—December 27, 2007—Amazon.com (NASDAQ: AMZN) and Warner Music Group (NYSE: WMG) today announced that DRM-free music audio downloads from Warner Music Group are now available to customers on Amazon MP3, Amazon's a la carte MP3 digital music store where every song and album is playable on virtually any personal digital music capable device. Beginning today, songs from WMG's digital audio catalog will be available for purchase and download from Amazon MP3. In addition, Amazon and WMG will make available to consumers digital music products such as album bundles containing exclusive tracks.

"Our customers are delighted with our DRM-free MP3 service. We have received thousands of emails from our customers since our September launch thanking us for offering the biggest selection of high-quality, MP3 audio downloads which play on virtually any music device they own today or will own in the future," said Bill Carr, Amazon.com Vice President of Digital Music. "With the addition of great Warner Music Group content, our customers will discover even more of the music they love on Amazon MP3."

"Consumers want flexibility with respect to what they can do with music once they purchase it, and we want them to have that flexibility, which is why we're pleased to offer our artists' music on Amazon MP3," said Michael Nash, Senior Vice President, Digital Strategy and Business Development for Warner Music Group. "We believe that giving consumers the assurance that the music they purchase can be played on any device they own will only encourage more sales of music. Amazon shares our vision with respect to offering feature-rich music based digital products, and we look forward to making available an array of exciting new digital products over time that will transform the relationship between and among consumers, labels and artists."

About Amazon MP3

Launched in September 2007, Amazon MP3 (www.amazon.com/mp3) offers Earth's biggest selection of a la carte DRM-free MP3 music downloads with more than 2.9 million songs from over 33,000 record labels.

* Every song and album in the Amazon.com digital music store is available exclusively in the MP3 format without digital rights management (DRM) software. Amazon's DRM-freeMP3 format enables customers to play their music on virtually any personal digital music capable device—including PCs, Macs , iPods , iPhones , Zunes , Zens —and to burn songs to CDs for these customers' personal use.
* Most songs available on Amazon MP3 are priced from 89 cents to 99 cents, with more than 1 million of the over 2.9 million songs priced at 89 cents. The top 100 best-selling songs are 89 cents, unless marked otherwise. Most albums are priced from $5.99 to $9.99. The top 100 best-selling albums are $8.99 or less, unless marked otherwise.*
* Every song on Amazon MP3 is encoded at 256 kilobits per second, which gives customers high audio quality at a manageable file size.
* Buying and downloading MP3s from Amazon MP3 is easy. Customers can purchase downloads using Amazon 1-Click shopping, and with the Amazon MP3 Downloader, seamlessly add their MP3s to their iTunes or Windows Media Player libraries.

* Taxes may apply in certain jurisdictions.

About Warner Music Group

Warner Music Group became the only stand-alone music company to be publicly traded in the United States in May 2005. With its broad roster of new stars and legendary artists, Warner Music Group is home to a collection of the best-known record labels in the music industry including Asylum, Atlantic, Bad Boy, Cordless, East West, Elektra, Lava, Nonesuch, Reprise, Rhino, Roadrunner, Rykodisc, Sire, Warner Bros. and Word. Warner Music International, a leading company in national and international repertoire, operates through numerous international affiliates and licensees in more than 50 countries. Warner Music Group also includes Warner/Chappell Music, one of the world's leading music publishers, with a catalog of more than one million copyrights worldwide.

About Amazon.com

Amazon.com, Inc., (Nasdaq: AMZN), a Fortune 500 company based in Seattle, opened on the World Wide Web in July 1995 and today offers Earth's Biggest Selection. Amazon.com, Inc. seeks to be Earth's most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices. Amazon.com and other sellers offer millions of unique new, refurbished and used items in categories such as health and personal care, jewelry and watches, gourmet food, sports and outdoors, apparel and accessories, books, music, DVDs, electronics and office, toys and baby, and home and garden.

Amazon and its affiliates operate websites, including www.amazon.com, www.amazon.co.uk, www.amazon.de, www.amazon.co.jp, www.amazon.fr, www.amazon.ca, and the Joyo Amazon websites at www.joyo.cn and www.amazon.cn.

According to BusinessWeek, it works like this:

[Total Music will] get hardware makers or cell carriers to absorb the cost of a roughly $5-per-month subscription fee so consumers get a device with all-you-can-eat music that's essentially free. Music companies would collect the subscription fee, while hardware makers theoretically would move many more players.

According to an AP story, advertisers in this lucrative program currently include Warner Music, 20th Century Fox and New Line Cinema. They'll be paying $20 per 1,000 clicks. The first videos to run the ads will be from artists signed to Warner, and from a totally horrible band I only just heard about called Killswitch Engage (wish it were literal). People who host videos on YouTube will be able to opt into the program, though it's not yet clear what the revenue share is between YouTube and the content owner.

Why is this happening? Because Google bought YouTube for $1.76 billion, and yet last year it only generated about $15 million. Chump change, as they say in Silicon Valley. [AP]

Meanwhile, Warner Music, which has an agreement with YouTube, announced that it would begin to share music videos for free on ad-supported sites based around artist. OK, so like, how is that different than the promotional artist sites that already have videos? Oh, right, ads. Thanks WMG!!

You know all of this business wheeling and dealing aside, I'm just glad we might actually be entering a new golden age of the music video. I mean, nothing will ever touch A-Ha's "Take On Me" or Jamiroquai's "Virtual Insanity," but do I want my new music rendererd visually for better receptivity into the assorted memory banks of my brain? Yes, I do. – Wilson Rothman

YouTube signs broad licensing pact with EMI [Reuters]
Warner to put ad-supported video archive online [Reuters]

But casting a slightly cynical eye toward this project:

First of all the Warner Music Group doesn't mention how much money it donates to Habitat for Humanity for each mix you send. Plus, Habitat for Humanity International, a religious organization dedicated to eliminating poverty housing and homelessness and whose motto is "Building houses with God's people in need," has a two-star (out of a possible four) efficiency rating from the Charity Navigator, Your Guide to Intelligent Giving. And its CEO earns over $210,000 a year. Just thought you might want to know. – Charlie White

U-MYX - Get inside the Music! [Warner Music Group]