In a bid to gain traction in to the digital download market, last week Amazon renewed its offering of Lady Gaga’s newest album, Born This Way, (read our review here) for only 99 cents. Tired of playing second-fiddle to the iTunes juggernaut, Amazon is willing to take the financial hit to win over new customers and build awareness of the service. And what a hit it will be; according to Billboard’s calculations, for every copy of Born This Way sold at the reduced price, Amazon is projected to lose about $7.40. Given Gaga’s ubiquitous popularity, it’s not unlikely those sales could reach the hundreds of thousands, which would put Amazon almost $3,000,000 in the hole. Ouch. iTunes, on the other hand, seems to be making money hand over fist with the album, selling copies at $16 each, but still topping the album sale chart.
If Amazon’s servers function as poorly today as they last Monday, Amazon may not have to worry about losing any more on the album; almost as soon as the promotion began, Amazon’s servers were hammered with traffic, resulting in six-hour-long download times in many cases. While everyone who ordered the album on Monday were guaranteed the price and eventually got to download it, these sorts of incidents don’t really reflect kindly upon a website looking to build up its reputation as a viable digital provider.
[via AV Club]
