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Apple Sells A Million Songs in Debut Week
Scrameustache writes "According to an Apple press release, the iTunes Music Store sold over one million songs during its first week. Over half of the songs were purchased as albums, and over half of the 200,000 songs offered on the iTunes Music Store were purchased at least once.
Those new iPods are selling like hotcakes too..."
http://www.wired.com/news/privacy/0,1848,58718,00. html
Today I found a "New Music Tuesday" mailing in my inbox, from Apple, highlighting almost 20 recent (complete album) additions to the Music Store that are available as of today.
If they do that many every week, that is seriously gonna bolster their catalog.
~Philly
In a nutshell, you can play your music on up to three computers, enjoy unlimited synching with your iPods, burn unlimited CDs of individual songs, and burn unchanged playlists up to 10 times each.
You can "authorize" and "de-authorize" individual computers. As for re-purchasing songs, just make a backup on a CD, and you won't have anything to worry about.
My understanding on this is that it has more to do with licensing of the music. It is a different matter to get US distribution rights than worldwide. I do not doubt that Apple is working to extend their rights, as the European market is significant to Apple's hardware sales, but you can't really blame them for not waiting. A big part of their leverage to get better worldwide rights as well as an increased catalog will be the success of their first steps.
Obviously they aren't having a bad start of it, and they have recieved really great press. I know people who are considering buying macs and ipods based on this.
It's not about billing adress. It's about legislations governing copyrights and distribution agreements with the respective music companies.
Apple has to work out specific legal issues before it can distribute the music to other countries.
I am pretty sure the restriction was with having the rights to international distribution worked out yet. Either on the Apple site or in the press release it states that they are working that out. Since the technology should be the same, i am guessing it's a legal issue. Odds are they will not have international rights to EVERYTHING in the catalog, so they will have to modify the store to display songs by the user's location. Maybe they will get past it, but in general stores/distros are restricted to certain territories.
1 million songs at $0.99 is about $1 millions/week. Assuming that the demand stays constant?which is unlikely as there was probably pent-up demand, as well as let?s give it a try users in the first week?the total revenue for the year will be about $52 million. Although this sounds like an astounding success, it is less than 0.2 percent of Dell?s revenue (FY03 revenue $35.4 billion), and less than 0.02% of Walmart?s revenue ($218 billion). And it will only account for 1% of Apple?s revenue.
Note also that Apple doesn't keep the entire $0.99 - about $0.65 of it goes to the record label.
It's important however that this is very high-margin revenue. Apple's cost of sales here is recouping the cost of developing the service, plus the bandwidth, plus the credit card processing fees, plus the cost of having developers maintain the service. This has got to be pretty low compared to pressing CDs to put into cardboard boxes - let alone manufacturing computing machinery.
And Apple plans to roll it out to Windows users later this year - which should increase the revenue stream considerably.
ASA
All employees must wash hands before seeking equitable relief.
emusic.com does not carry next year's Grammy nominations but if you're into Jazz or older alternative it is cheaper than Apple's offering, has been along longer, and is not DRM restricted.
There was a link to an interview posted in the last discussion of iTMS sales numbers. In that interview, Jobs said that Apple will begin working on independant music once they've finished uploading all the files that the big 5 have given them. Right now they're really busy just uploading.
t'nera semordnilap
Selling a million of any new service in this short period of anything is impressive. What other service has had similar success?
So far, this is marketed to a group of people:
Who own a Mac
AND Who own iPods
AND live in North America
What is that, 1% of Apples 2% market share?
Once it hits PC's with other players, it could become huge overnight.
Even if the company "only" makes $30 million...
What has happened to the world when making "only" $30 million is a bad thing?
Besides the service only just started last week, normally sales of a new service start out slow and grow as people test the waters and if it's safe, others jump in. There is little word-of-mouth advertising yet. And up till now, who needed an overpriced iPod? Now it seems like a better investment.
If the price of entry for unsigned artists is is the cost of studio time, plus paying Apple for server space there could be MORE alternative artists in the mix. This is assuming the labels haven't locked out the independents.
There is much more good potential in the service than you give it credit for.
If tyranny and oppression come to this land, it will be in the guise of fighting a foreign enemy. - James Madison
Apple charges way too much for their RAM. You're almost always better off buying an Apple system with whatever RAM it ships with, then buying more from someone else and installing it yourself.
The price of most albums is $9.99, unless there are fewer than 10 tracks. In that case, the total for the album is adjusted down. The remaining case is for "double CDs" which typically cost 2*$9.99
Now, please quit with the "N_songs * $1 > cost_of_album" foolishness.
There is room for improvement with the selection. That having been said, the experience is very pleasant and purchases are smooth and easy.
The REAL accomplishment is that Apple has apparently figured out how to do Credit Card Micropayments.
DeanT
The songs that are sold from the iTunes Music Store have DRM immeded in them. This allows the songs to only be played on up to three macs at one time, but you may deauthorize one mac, and authorize another one to play your purchased musis. This macrumors article goes more in depth of the DRM system.1 95456.shtml
http://www.macrumors.com/pages/2003/04/20030429
Measure once, cut twice
um, it seems you're forgetting something: as yet iTMS is only available to US based Mac users, a teeny tiny proportion of global computer users.
Once Apple rolls out the international, and Windows versions of the service (and you can bet they WILL be released in that order) takings look set to rocket.
There are ways out there to play AACs other than iTunes 4 or an iPod (like VideoLAN Client, for example).
...
BUT the AAC files you buy from Apple are "locked down" to your Macs (you can authorize up to three Macs to play your music), so sharing them is of "limited value", to say the least.
AND all the files you buy from Apple are watermarked with YOUR name/e-mail address -- not exactly the kind of thing that makes you eager to put them up on the public p2p networks.
Yes, you can burn the AACs as plain audio onto a blank CD-R, and then re-rip and re-encode them as MP3s and then manually re-tag them, but as a file-conversion technique, this process takes a lot of time. And uses up an awful lot of plastic, too.
Apple's done a pretty good job of making it "appropriately difficult" for you to share the music you've bought with the entire planet. Now if only I could play those AACs on my Archos Jukebox, or in my car, or
-Mark
Then why do people always protest Microsoft's bundling of browsers, media players, etc with the OS?
If Apple is "good" for bundling applications and not giving consumers the choice (for example, the music purchasing ONLY works with iTunes), then why is Microsoft "bad" for including IE and Windows Media Player with the OS? And can you imagine the outcry if Microsoft began selling music inside Windows Media Player? Slashdot would be screaming about the monopoly.
The difference is that one company is an illegal monopoly, convicted of antitrust violations, and has a history of using its monopoly power to eliminate all competition in areas it enters with new products, whereas the other company is a small niche competitor that poses no threat to dominate the personal computer market and stifle innovation.
It may not be an ideal world, but them's the breaks.
AAC is not a proprietary format. It's the audio component of the MPEG-4 standard.
You can tell a great deal about the character of a man by observing those who hate him.
You've missed several key points. If you read many of the press reports regarding this service, you'll find out that the big 5 labels were willing to give such liberal rights to Apple because it represents such a small share of the computer market. The major labels look upon this as an experiment. In fact, the contracts are written such that they can back out of the service after a year. If it continues to be such a success they intend to allow Apple to sell to Windows users. Basically, it is more than writing a Windows application. You need to sign agreements with the major labels. Apple is first in line.
'nuff said!
Alison
"It is a miracle that curiosity survives formal education." - Albert Einstein
That comment is so amazingly ill-informed, everybody here is a little dumber for having read it.
The RIAA != the record labels. Yes, they have spent a lot of their resources fighingting Napster, Kazaa, etc., on behalf of the labels, but it also represents almost everybody else in the music recording industry, including artists. In addition to enforcing copyrights, they help establish industry standards (such as that little pre-amp that goes into turntables... okay, younger /.ers might need to ask their fathers what a turntable is.) Saying that this will hurt them is like saying that putting a dent in Sony's hardware sales will somehow hurt the IEEE.
Furthermore, all of the music sold on the iTunes Music Store is licensed, and those license fees are managed by... guess who? That's right, the RIAA.
If this takes off, it might kill your local record store (if Best Buy had not done so already) but it will not make the RIAA go away.
Information wants to be anthropomorphized.
Actually, every file sharing protocol except kazaa's is implemented on the mac.
And of course "most of those files sold were sold to Mac users" because iTMS is only available to iTunes-Users, and iTunes ist until now still mac-only.
There's a less invasive way to demonstrate that the m4p file contains the name/address of the purchaser: buy a song and e-mail the file to a friend who also has a Mac and iTunes4. When they double-click it open, they will be prompted to "authorize" their computer to play this song -- and the text of the prompt includes the e-mail address of the original purchaser, and prompts for their password. That the files contain the identity of the purchaser is not really a secret, especially given that it displays it prominently in the password challenge dialog box when m4p files are moved to a new computer. I found this the first time when my wife mailed me some songs she had bought, and I had to ask her to come over to my computer and enter her password.
But the easiest way to see that the songs contain the purchaser's name is this: open iTunes, click on a song you've purchased, and choose Get Info... and there's your name!
-Mark
an that is just to apple user and no one else. imagine if this had been world wide.
On the otherhand 1 million sales is a tiny drop in the record sales bucket. if there are 1 million songs sold that's less than 100,000 albums sold. which means over the course of a year that will mean about a million album sold if they can sustain this pace. that's trivial. how many times a year does a artist release an album that goes "platinum"? seems to me they are many every year, some from each record label. thus if apple sustains this pace it will only contribute a single platinum album. Of course there may be a large multiplier effect if the profit margins on this are higher/lower than normal album sales.
What this really shows is how utterly insignificant all of the the other on line music sales were prior to this. they didn't even register: a single mega-record store in NY city could outsell all of the annual online music in a good day prior to apple's involvment. likewise selling CDs by mail also vastly exceeded this market.
heck AOL sent out more of their free trial disks than that!
on the otherhand, once this hits the rest of the world and once this hits the windows world. now were talking a large dent in the sales of music online. again remeber their may b eprofit margin mulitpiers too. this will be true in places that yearn for "pop" music but dont have such good access to music stores as in the US. likewise, world artists will be able to crack the US market if apple lets in lables that lack US distribution systems.
now lets talk about how intrusive the DRM is. its not bad compared to all previous efforts. you can keep your music on a CD so insome sense you own it. but re-ripping it is supposed to be not so good, and thus since digital music is the only way you will be using music in the future having an unrippable high quality CD is not as good as it seems. Apple's tech knowledge base warns you to deauthenticate your mac before you reformat the disk or sell it. its not clear but it seems to imply that you could lose one of your 3 authentications if you dont.
Apple warns you they are free to change how they authenticate your music when you install it on a new mac any time they wish.
This lack of clarity over the authentication protool has me worried but not hyperventilating.
legitmate questions include:
1)how do I authenticate my music on future macs or ipods if mac sells its music store to someone who either goes out of bussiness or starts charging fees to authenticate. (dont laugh mac switched its bussiness model from free to pay for mac.com and claris works)
2) Someday i'll want to keep my music on my phone, credit- card computer, ring, implant, etc....will future itunes allow me to move music to non-mac music players?
3) if my computer is lost, the mother board dies, my hard disk crashes, or a virus eats it, or my employer seizes it before deauthenticate have I lost one of my authentications?
4) what if I go bankrupt and cant get a visa card. how do I maintain a music store account so I can authenticate?
5) in the future, will legacy macs that cant run the latest OS also not be able to de-authenticate?
As I said I'm not hyperventilating, and like 8-tracks and vinyl I dont have the unreasonable expectation that I wont want to replace my music media in the future. but I dont want to be forced to because say apple goes out of the music bussniess.
and yes I realize I can make an audio CD but its not the same as having bought a CD in the store since the store bought CD will rip to higher audio quality for use in digital players (and I predict in the future all useful players are going to be digital-- there wont be many CD players except as ripping devices)
Some drink at the fountain of knowledge. Others just gargle.
Really?? Then why am I sitting in the building right now, working away?
Apple's G4 desktop/server manufacturing in Cork is still running along. In fact, I was out on the production floor 5 minutes ago .. :-)
BTW - guess where the European support centre is? Cork, Ireland.
Alison
"It is a miracle that curiosity survives formal education." - Albert Einstein
...I see your point, but I do recall an article (Time mag?) in which the head of Warner Bros. said the delay on including their catalog is purely technical, and that the business and legal terms are already agreed.
You're probably thinking of PCB manufacturing, which got closed a few years back.
Did you know that Lisas were also built here? Some of the folks around here have been here 20+ years and can remember the days ... there are still pics of the ][ and the ][e still on the walls here. It's a cool place to work.
Alison
"It is a miracle that curiosity survives formal education." - Albert Einstein
I see what you're getting at, but the topic is why Apple is allowed to integrate browser-like features into OS elements and bundled apps, while Microsoft gets slammed by the DOJ for the same thing. The answer, as stated above, is that Microsoft is a dominant in the relevant marketspaces, while Apple is not. The activity of integrating browser features is not illegal per se -- Doing so as a means to stifle competition when you are dominant in the market is illegal.
Well, I asked the author of the article, Jonathan Rentzsch, what he thought, and he wrote back to clarify:
So there you have it. Interesting stuff, I guess.
yours
Software for macs, in general, has a much lower rate of piracy than software for PCs. I personally suspect this is the case because a bigger fraction of Apple's customers are grown-ups rather than 'l33t h4x0r5. I suspect that has a lot to do with how His Steveness got the Big 5 to go along with this. I actually suspect that ITMS tracks won't find their way to p2p in droves, as some of the naysayers say will happen.
Well, i128-bit AAC is not low-quality to me. I've actually listened to the songs and they sound just fine. YMMV. Have you purchased and listened to the music yet? If not, you might be surprised.
Secondly, the albums are priced at $10! How the hell can you people not know this yet? There are hundreds of posts pointing out that you can buy albums as a whole for less than the cost of buying all 10+ tracks individually! Learn the facts before you criticize!
The files are a copy of a copy? Actually, they're digitally remastered versions of the songs, specially made for ITunes MS. Besides, even if they were a copy of a copy, a digital copy is perfect and suffers no degradation in recopying, so I could have a 1000th generation copy that's as good as the first.
As far as the restrictions go, there are none that I actually notice. I can burn as many CDs as I want, listen to my collection on my computer, my ipod, and my girlfriend's computer and ipod. Since I think p2ping music is immoral, I don't care that these are useless to kazaa users.
My ideal is also cheaper and higher quality, but that doesn't make this a great service. It's worth it to me. The only thing I find really troublesome is that if you haven't backed up your computer and it crashes, you (apparently, I'm not sure on this) can't re-download purchased tracks for free.
There are about 5 billion burgers sold each year in the US -- Suggesting a subsidy of $55 Billion.
The total governement agriculture budget in 2002 was $18.6BB, which means the chicken, hog, wheat, and soy bean producers are being completely ripped off!
Heck, McDonalds and Wendy's together have about $4.5 BB in revenue (yahoo finanace), including international sales.
Bottomline: your statistic makes no sense.
"All that is required for evil to triumph is for good men to do nothing." - Edmund Burke
$.99 a song means you are spending the equivalent of $15-$20 a CD
No, CDs are $9.99.
Next, you can't use them like CDs because they are protected
Yes you can, because you can just burn CDs from iTunes
crash your system, lose all your music.
Not if you back it up. If your house burns down you lose all your CDs unless you have them insured.
You are paying top dollar for crap.
Wrong, you obviously haven't heard any of the music.
Sorry but I'm not buying anything from Apple or anyone else at these prices with these restrictions.
I'm guessing it's because you'd rather just continue stealing music from the artists.
Sample rate is 44.1 kilo sample per second. (KHz)
Bitrate is 128, 256, etc kilo bit per second (kbps).
These two has absolutely nothing to do with each other. You can have MP3 files with 44 KHz sample rate and 96 kbps. Or you can have 11Khz with 320 kbps.
The only thing that you can definitely tell is if any of these numbers go down, the sound quality suffers. Example:
44.1kHz, 128Kbps is better than 22KHz, 128kbps
and
44.1kHz, 256kbps is better than 44.1KHz, 128 kbps.
Think about it this way:
The horsepower rating and the torque rating of an engine is not related (per say), but it is "stronger" if both of those numbers are high, right?
Code poet, espresso fiend, starter upper.
Feel free to steal it!
No link is necessary, but please leave my name in.
But if you convert the file to an mp3 or burn it to a CD, your name won't appear.
you can download it to as many ipods, yours or anyone who walks in your room. this is very liberal thinking on apples part. the catch is they have to be physically connected to an authorized mac. you cant port these songs form ipod to ipod as far as I know. and you cant move them to another computer without authorizing that computer.
I dont know how the authorization works.
eventually i suppose there may be a decss like program for it. but maybe not since the authorization challenge is remote and not fixed like on dvds. it may be unbreakable.
apple is free to change how they do the authorization. thus whether or not you can get a key for a non-apple machine is up to them. at this time. no.