Apple’s music marketing tactics under scanner

In this file photo Apple CEO Steve Jobs talks about the new iPod Nano at an Apple event in San Francisco. The U.S. Justice Department is examining Apple’s tactics in the market for digital music, a media report has said.

The U.S. Justice Department is examining Apple’s tactics in the market for digital music, says a media report.

Investigators have asked questions about recent allegations that Apple used its dominant market position to persuade music labels to refuse to give online retailer Amazon.com exclusive access to music about to be released, The New York Times reported.

The antitrust inquiry is in the early stages, the report said, citing people familiar with the situation.

According to the publication, representatives from Apple and Amazon declined to comment. Gina Talamona, a deputy director at the Justice Department, also declined comment.

In March, Billboard magazine reported that Amazon was asking music labels to give it the exclusive right to sell certain forthcoming songs for one day before they went on sale more widely. In exchange, Amazon promised to include those songs in a promotion called the “MP3 Daily Deal” on its Website, the NYT said.

The magazine reported that representatives of Apple’s iTunes music service were asking the labels not to participate in Amazon’s promotion, adding that Apple punished those that did by withdrawing marketing support for those songs on iTunes, it added.

Apple is by far the largest seller of online music in the U.S., with 69 per cent of the market, according to data from the NPD Group, a marketing consultancy. Amazon’s MP3 store was in second place, with an 8 per cent share.