Digital Transactions Authoritative, insightful and timely information for payments professionals
Apple Computer Inc.'s iTunes Music Store has announced it is accepting PayPal in the U.S. for payment of song downloads, audiobooks, and gift certificates, effective today. The development represents a major breakthrough for the San Jose, Calif.-based payments unit of eBay Inc. and comes a year after the company slashed its merchant pricing for online music sales (Digital Transactions News, Dec. 8, 2003). To promote the new iTunes payment method, Apple says the first 500,000 customers who open a new iTunes account funded with PayPal before March 31 will receive five free songs. Up to now, iTunes has sold 99-cent song downloads and other content through credit cards. PayPal, which boasts 56 million account holders, allows its users to fund payments via a credit card, a bank account, or a prepaid account. The iTunes service, which almost single-handedly created the market for online music sales, has an inventory of 1 million songs.
