Slashdot Mirror
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..."
I think the model may work. Let's hope it torpedoes the RIAA completely.
I don't want to spoil your fun, but 20 albums a week is not really much. After downloading iTunes, I finally decided to digitize my CD collection. 443 CDs in 6 days. I seriously can not imagine Apple not having 2 iMacs free to do the digitizing.
Okay, okay, I know they rip from mastertapes and all that fanchyscmanchy stuff, but that's no excuse for being so terribly slow. I would expect them to rip 2000 albums a week !!!!!!
Most of all, where's blue note ?????
When will I end this grieving ? When will my future begin ?
How much of this success is due to this being a truly significant advance in implementations versus Apple simply having a heavy presence in the market?
I'm not trying to sideline the significance of the success, I'm just questioning why it is really successful. From what I have heard, this is not all that much different than approaches that others took earlier (Didn't eMusic, the popular word among those that don't like iTunes, originally sell per song?).
Alternatively still, maybe the market is just now ready for such a store model as this. Timing is, afterall, very important in delivery of a product to market. Too early can be as devastating as too late.
well if you read the articles you will see that Apple's music store sold more songs in a week than the others have in months. Ignore the little Apple icon if you must and see it as *somebody* has possibly finally figured out a way to sell music downloads that people like. The question is how will the sales be in a few months. The Apple policy is a lot more reasonable than anyone else. None of the other services let you put the songs on a portable MP3 player, let alone burning it to an audio CD (which strips the DRM).
I'm still not sure how this service is going to make a lot of money. While a million tracks may sound impressive, you need to keep in mind that it's quite unlikely that they can keep that rate up for very long.
If the tracks were all sold as singles (they weren't) and if Apple kept all the money from the sale (they don't) AND if they could keep up their one million songs per week rate (doubtful), then by the end of a year they've made $52 million. Take out administration costs (I have no idea what they are, but I'm guessing they must be fairly significant) and the RIAA's big cut, and I'm guessing Apple would be left with somewhere in the neighborhood of $30 million after a year, and that's ONLY if they keep up the sales rate they had in their initial week every week of the year. Sure, $30 million in revenue is nothing to sneeze at, but it's not going to convince anyone that online music sales are worthwhile.
Remember, $30-50 million is equal to the revenue from a couple platinum albums, and isn't enough to finance nearly as many artists as the current model can (keep in mind that every "flop" gets subsidized by hit records). I would expect that if the recording industry were to switch to this model that MORE over-produced pop garbage would be pushed since the dramatically lower revenues would keep the companies from taking many risks with "alternative" artists. And you thought it was bad now...
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.
It blows my mind that Apple has been able to improve on the iPod. As if the original's form factor was too thick (not quite as thick as a deck of cards), they still somehow cut it almost in half.
I played around with the new music service this week. Super impressively done. Having said that, I don't think I'll order any music from it. The record companies have shown themselves to be complete bastards for decades now, in how they screw over the public and the artists. I hate to think that Apple's now riding to this industry's rescue, perhaps only a year or two before the entire industry would go down the crapper. If there was only some way I could use this service with the bulk of the money going straight to the artist, I'd be incredibly enthusiastic about this whole thing.
I'm always thrilled to see Apple succeed at something, since I think they tend to make beautifully designed products. I just hope that this success isn't the event that keeps the parasitic recording industry form withering away.
I'm generally "Interesting," "Insightful," and even "Funny" here. What the hell happens to me at parties?
Is how well these things are selling in a proprietary format. This should wake up the music industry into possibly providing a new digital format that is standard, because it appears as though people want something different/in addition to CD.
This is the kind of thing which Apple's control over hardware, software, and consumer applications together permits it to excel at. What is astonishing is that Microsoft has proved so poor at this kind of coordination.
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.
What's your damage, Heather?
I don't know if I am off the deep end, but it seems to me Apple didn't figure they would make BILLIONS off of selling songs for 99 cents.
:) Either way, life is easier with an Apple.
I do think they figured they would be able to sell their iPods at an increasing rate (which they have a much better profit margin on; 110,000 new iPods ordered this last week). They also are opening their arms to a new customer base, music-lovers. Now music-lovers will buy an iPod because they are amazing, but then will think: "if this is so cool, I should try the new iBook or PowerBook". Then Apple makes more profit there too. Who agrees? This is where they make their money, and then they have an Apple customer for life. Not bad for starting with a 99 cent sale.
I am an Apple customer for life, but mine started with 2500 dollars for a PowerBook.
Are there any other aac compatible players besides the iPod?
Apple has this new product that seems to totally rock (literally and figuratively), except they won't have a Windows version till "late 2003". I wish I could try it.
Is it just me, or could Apple just hire a couple of half-decent Windows developers and have this ported in just a little less time (like weeks)? Of course, how many years did it take them to get QuickTime to work right (or roght-ish) on Windows?
That's plenty of time for Microsoft to roll out a half-assed product in 3 months with much stricter DRM features and completely destroy Apple because they instantly have 20 times as many potential customers.
Apple will once again have the superior product and single digit market share, whereas if iTunes were available today, they would get the jump on Microsoft (and others) and actually have a chance to do something successfully. People are dying for this product and if Microsoft rolls out something that is at least tolerable, if inferior, tomorrow, iTunes will never make it on Windows, where all the customers are! We're not talking about the Linux crowd, which is important but still relatively small, we're talking about 95% of computer users in the world!
Can they really be risking their whole business plan for lack of a few decent Windows people? Or am I missing something?
You are in a maze of twisty little passages, all alike.
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?
Okay, let's look at the browser example. Say I don't like Safari (which most likely will be bundled with OS X 10.3 instead of IE). I am free to trash it and go back to using IE. Can you get rid of the bundled browser in Windows so easily? Nope.
Apple rolls their own software and bundles it with the OS to empower their users-- nobody was gonna buy Adobe Premiere to do home videos, but plenty of people will use iMovie since it comes with the Mac. And the Mac was losing mindshare over browsing speed, because IE on OS X is utter crap and hasn't been updated in forever-- to fix that problem, Apple whipped up Safari, which blazes.
Microsoft bundles free apps to destroy their competition or to take over a market. IE was given away to torpedo Netscape, which it successfully did. Windows Media Player is given away free so Microsoft can point to a significant [pre]installed base when they make arguments as to why their (Microsoft's) proprietary file formats should be The Standard.
~Philly
I've been wondering about the resale value of these downloads. I typically sell my old CDs (secondspin.com or uzed.com) when my musical tastes change, I get tired of a CD or I simply need some cash. What will I do with songs downloaded from Apple?
Does the user ID of the person downloading the file get embedded in the AAC file in any way? Have AACs showed up on Kazaa yet?
Just curious, I don't own a Mac and I stopped using p2p nets.
there's no place like ~
esoteric music? forget it! they have NOTHING by Aphex Twin - which is about as close to commercial as an esoteric artist is gonna get. Still I just buy direct from warp or Replex as necessary...
That was classic intercourse!
What you need to remember, is that Apple is a HARDWARE company. Everything they do is to drive more hardware sales. Every product they make is going to come out first for the Mac to drive hardware sales. Why come out with a PC version immediately, and drive sales for your competitors?
True, true. Last night I spent $15 on a 25 year old Elvis Costello album and $20 on a brand new compilation featuring Hieroglyphics. $20, for a damn 12 track compilation. Of course, I coulda just bought that new fitty cent abum they's playin' on the pop radio, there. Did you know he's been shot? Or maybe I could buy that Good Charlotte record where he complains about famous people having problems in their personal lives, because as we all know money is the first step to happiness. Alas, I cry for the lost spectre of punk music...Shelter, take me away!
Seriously, it's embarassing how much the industry caters to "typical" tastes in music Notice I didn't say "BAD" tastes...I've bought a lot of really cool albums from commerical outlets. But if you're into anything even slightly left of the dial, you're screwed. They just don't have the space to dedicate to anything different that isn't guaranteed to sell. Which leads to such stupidity as my local FYE having three copies of the Super Saver version of Carly Simon's greatest hits, but can't even order the Beta Band's Hot Shots II when I ask.
There is so much music out there in the world right now that there's no way a traditional media outlet can survive, without becoming a more or less a warehouse and charging massive prices as a sort of "stocking fee" for carrying wierd shit. Internet music services, however, aren't tied to this. Stocking a new AAC compressed album takes about 100 meg of space, or around 8.3 cents on today's storage market. If it doesn't sell...well, nobody's hurting.
$.99 may seem like a lot if you're still thinking of a CD as a $10 entity. But it would have save me $7 yesterday...$8 if I didn't download the dumb 40 second intro.
Hey freaks: now you're ju
Have you listened to an AAC at 128 bitrate? Albums of 20 songs only cost $9.99 A ten minute classical song costs only 0.99.
You can burn them to CD in straight audio format (aiff), no DRM included. After that you can do what you want, straight to mp3 and Kazaa if you feel the need... nearly as many times as you want (playlist has to change every ten burns). Every had your CD chewed up by a dog? scratched while moving? ever get a refund? isn't that what backups are all about?
Yes you are missing almost everything... you got the 0.99 a song part correct, everything else was just FUD. Insightful my arse.
A fool throws a stone into a well and a thousand sages can not remove it.
> their way back to the cattlerancher?
For every fast food burger sold in America there are $11 in government subsidies, almost all of which goes to the agri-food conglomerates.
If a Big Mac cost you $11 more than what you are charged for one, how many would you buy? The myth of the free market.
The difference here is:
1. ALL the iApps can easily be removed by simply dragging them to the trash and emptying it. Poof! Gone forever. Just try and do that with Internet Explorer or MSN Messenger. There's a difference between force bundling and comingling code.
2. WMP is spyware. iTunes isn't. If they want to put a music download service into WMP, more power to them.
You can save in your favorite format without actual CD burning:
Boot Linux on your PPC, start MOL with your OSX in X11 window with network activated, run iTunes, listen the file, hook at your xmms and save it in any format xmms supports.
Legally, you should do it only to listen on the same PPC, just when you boot to Linux. Or, let's say, for "backup" purposes (like on tape).
Less is more !
I showed a relatively geeky PeeCee user iTunes and the iTunes music store the other day. He'd kind of wondered why me (the person who goes into his company to administer their Sun/Sybase servers) carries a Powerbook G4.
;-)
He was pretty awe struck when he saw the iTunes store, and also pretty impressed with how slick iTunes was in general. Notably, he was impressed with the amount of initial content Apple had up there, the fact that it downloads (and displays) album cover art, and the fact that previewing songs is STREAMED and not downloaded, meaning you can preview quickly.
He was equally impressed with my transparent terminal windows too
I'm not joining the "Macs are better than PCs" camp, just an interesting observation on what a PC user thought...he liked the transparent windows and the iTunes music store...which are BOTH things that are quick and easy to demonstrate at the point of sale....so maybe Apple might be able to "switch" a few more PC users with the tightly integrated music store?
YMMV.
-psy
Cheers to Apple for doing nearly the obvious (and that which record companies thus far have been unable to do, perhaps due to lack of vision (heads in asses and such)).
Now someone tell my why RIAA's members have been so busy chasing the negative side of internet music distribution instead of implementing something like this. In fact, it's likely that MP3.com might have arrived at something similar to this, had they not been on the wrong end of pointy lawyers.
There's no magic in this formula. The only really creative aspect is perhaps the user interface presented by Apple. There's no good reason the record companies couldn't have done this themselves, with good developers.
Of course, there's a negative side to this. Apple is (inadvertently?) furthering the status quo in the music industry. I think the music industry had been heading for a major shakeup, where artists were going to gain some control back over their works (not to mention some real compensation).
So, *cheers* and *jeers* I guess :)
.sigs are for post^Hers.
First, it's more convienent than going to a brick-and-mortar music store. I don't have to get in the car and go anywhere, I don't have to dig through the racks to maybe find what I'm looking for, and I don't have to stand in line to hand one of the pierced nation my money.
Second, Apple's pricing scheme is right on the money. Been looking for a couple of tracks? Buy just the ones you want. Want the whole album? OK then.
Third, the tie-in to the iPod is great. While I don't have an iPod yet, I can imagine how much simpler it will be to download songs from the store directly to the iPod without having to rip the CD.
I think the reason so many people steal music (and if you don't pay for it, it's stealing) is that convienence factor. I've used Kazaa on my wintel laptop and iSwipe on my iBook to grab tracks from things I used to own on tape (yes, I was probably stealing. I feel bad about it, really). It's always been a big hassle to find exactly the track I want, correctly ripped, on a site with enough bandwidth to support the download etc etc etc.
Apple has made it easy and cheap to find what I want. DRM? I don't care, because I'm not going to be reposting my songs to a P2P network. I'll be burning CD's for use in the car, and I can take a CD anywhere.
I don't forsee Apple being the big dog in the online music business forever, but, as usual, they've shown the rest of the computing world that it can be done, and the method works.
You can't have a battle of wits against an unarmed opponent.
This doesn't cut out the retail link though. It simple eliminates your local record store and replaces it with Apple.
If people get used to this kind of thing, they're much more likely to purchase music from independent artists someday - because independent artists will probably never be able to afford to get their CDs into record stores, but it won't be too much trouble for them to get onto download services.
Sure, assuming Apple don't end up with a near monopoly. This kind of thing suffers a classic network effect - can you see people joining 20 or 30 different download services to get their music? No, they'll use the ones that are most convenient - ie the ones that are integrated with their computers. I don't know for sure but I'd bet a lot that Apple won't be allowing eMusic to plug into iTunes anytime soon.
Right now the price Apple charges for getting a track onto this service is about 30-40 US cents, something around that figure. If they become a dominant middle man, who's to say that Apple won't start putting on the squeeze to up the margins just like the big bad old record companies did? They are all shareholder owned at the end of the day.
Name your own price for songs. I wonder which tunes would command the highest prices?
When I dropped by the Aple Store in Dallas last week to get my iBook serviced I was talking to the mac genius about the iTMS, iPod, and other stuff. He said that they have been getting calls literally all day from independent artists that want to get their music on the service.
I think it'd be great if that did happen: if people could get their music on the service by bypassing the record companies and the RIAA. It would practically make Apple into a music company without having to buyout Universal.
It's a ripoff, like everything else in corporate america. If I pay a dollar a song, that's roughly the same price I'd pay to just buy a regular CD. I have to go to the store or buy it online, but I have the entire song, 320 kbps, and I can copy it, rip it burn it ad nauseum. These apple non-mp3s are about the same quality as an MP3, but I don't have nearly the flexibility of FAIR USE.
O~ Him that studies revenge keeps his own wounds green. -- Francis Bacon
I still haven't figured out how any DRM measure can get around the issue of just hitting record in another application (not sure what Mac's have to offer), as long as you have a full duplex sound card, and saving the recording in any format you want.... Anyone care to clarify? I mean, it should be a near perfect reproduction of the original, DRM riddled song, since it never leaves the sound card, shouldn't it? Or are they just relying on "security through obscurity" to hide this method from the general public?
Demand determines price. There's a reason Doors songs still cost a certain amount and why Vanilla Ice albums go for $1 in bargain bins. For popular music, the price will remain steadily high... as long as the market bears the price. If you have back inventory and no one's buying it, well, you sell it for ridiculously cheap prices just to get rid of it and clear out your inventory.
I've actually never bought any Doors albums before just because I went to college in Santa Cruz and listened to rock radio, so I never really needed to own the albums. THEY WERE ALWAYS ON! Now if I want a select song, I buy the select song and I'm happy. This service will actually encourage me to purchase single songs from certain artists that I don't want whole albums from.
I wish this service existed in the days of Metallica's Black album so I could have purchased the three good songs on the album and not have been forced to listen to the rest of the grabage on it!
Pooty tweet