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iTunes Europe Goes Live
Spad writes "The Register is reporting the launch of iTunes in the UK, France and Germany. "iTunes will carry 700,000 songs from the five major record labels and independents, and prices for the download service start at 79 pence or 99 euro cents per song." It's not ideal (99c is about 55p) but it's better pricing than expected. I for one will be signing up to use it."
Well it's launched but there's not much on there at the moment and there's an awful lot of "Partial albums" consiting of just one song. Hopefully they'll be adding more tracks over the coming weeks....
How many Apple users are there in Europe anyway?
(UK-specific)
I've encountered very few, mainly in printing/advertising, etc. Apple in the US seem to have targetted education heavily; in the UK that niche was filled first (80s) by Acorn and Research machines, then latterly by PC-clones.
The only two Macs I've seen recently were:
However... iPods appear to be extremely popular. I'd guess they're the Windows-variety, though. (I suppose it's also possible that there aren't that many iPods - just a lot of kids with white headphones ;)
This is where the serious fun begins.
Apple also announced that the iTMStores would open all over the European Union in October.
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For instance, see:
http://www.apple.com/pr/library/2004/jun/15itun
Europe has many varying laws, from country to country, I'd imagine.
That's broadly it - in theory there's a unified directive; in practice only two states had implemented it as of end 2002.
This is where the serious fun begins.
The difference is that there is one copyright authority governing the entire US, and there is one copyright authority for every country in the EU, so supposedly you have to negotiate 25 different deals for every EU member country. The EU is not a country, it's a trade union.
On the other hand, I'm curious about something: amazon can sell music cd's across europe, why can't apple sell music files across europe? Does amazon have some kind of special deal to allow them to sell copyrighted materials in every country? Or is the internet again being treated like the bastard stepdaughter of the copyright world?
If any of you follow financial news, companies are reporting additional gains from exchange rates, and some years report losses...
Prices are set in local markets based upon localized demand and competition (limited monopoly pricing power from brand, even in a relatively competitive market), etc.
Right now, it is cheaper for Germans to buy German cars sold in America and reimport them, because even with the cost of shipping the car from the states, the Euro is so strong on the dollar that it results in the importing the American made German car is cheaper.
Companies set prices (usually with local subsidiaries because of assinine international tax laws) in each country. Many companies will engage in "hedging" with the currency derivative market, because they aren't in the business of currency speculation (although if it should work out in the long run, sometimes you win, sometimes you lose, then paying the commissions on those trades isn't economically intelligent, but it's important for hitting quarterly/annual numbers, joys of public accounting).
However, the price will be set in the European market based upon the prevailing price there. However, that is in part because of Apple's limited "monopoly" pricing power (note, this is NOT monopoly a la anti-trust, it's in a competitive market with highly similiar substitute goods, like CDs, pirated music, etc.), but only Apple sets the price for iTMS downloads.
One of the things that the Internet and digital transfers has the potential to do is destroy regionalized pricing, at least within the English (and then Spanish, etc.) speaking world. In that scenario, Apple could set prices in each store based upon local trends, but consumers could buy from whichever store TODAY's currency price makes most beneficial. That is great for consumers, but lousy for corporate profits (then they ALWAYS lose on the currency fluctuation, because the business goes to whatever is cheapest that day).
However, a Euro price that isn't identical to US pricing with TODAY'S rate of exchange makes sense. The Euro is up something like 30% on the Dollar in the past 12 months. If that trend reverses, and 1 $ = 1 E again, then a Euro price of 55 cents would devastate Apple. The Euro was established at a price level to make the nominal exchange of Euros to Dollars approx. 1:1, which would obviously fluctuate.
Consumers in general are more interested in pricing in their local currency then international pricing. Although the Internet has changed things SLIGHTLY, in general, most consumers don't engage in International trade, but rather buy from an organization that has imported the products for them. Hence Amazon has localized businesses, Apple set up local Apple AND now iTMS to price in the local currency. Cars are priced in each local market.
However, the free flow of information will reduce that ability over time, which is a good thing, but you shouldn't be shocked that it isn't instant.
Alex
Check out Magnatune.com - no DRM, just music and 50% goes to the musicians.
amazon can sell music cd's across europe, why can't apple sell music files across europe?
I suspect the difference is that Amazon.com just ships around pre-made physical goods, whereas iTunes Music Store offers digital downloading. It's essentially a completely new form of commerce.
Apple needs to convince the labels that they want to offer their product through iTMS, hence the need to negotiate deals. Apple has also said the labels make the actual music files, not Apple. So again, Apple has to convince the labels to put effort into encoding their products for iTMS.
Oh, the same tired tale. You know, if you want to get the record companies to stop promoting shitty bands, maybe you should first get people to stop buying shitty albums. It is a tragedy that Britney Spears has sold ten times as many records as Tom Waits with a quarter of the talent...but them's the breaks.
I mean, it's not like independent labels don't exist, don't sign bands and don't release albums to the mass market INCLUDING over iTunes. In fact, iTunes has more independent labels than any other online music store. You don't think SONY Connect is gonna court Asian Man Records, do you?
I've actually been quite surprised by the number of GOOD artists who get above-the-fold promotion on iTunes. Even the ones who don't are displayed RIGHT NEXT to their corporate shilling brethern. And the selection beats the crap out of the most ecclectic brick & mortars I've seen. I mean, iTunes has the friggin' Kind Geedorah record. I had to literally threaten violence at my local Newbury Comics to get them to even ORDER that shit, and even then it cost me $20.
Hey freaks: now you're ju
I don't think most of the iTMS customers are being driven to the store by the RIAA's lawsuits. All along, there have been lots of people saying that they downloaded music from P2P because it was convenient, and they only did it illegally because there was no decent legal alternative.
Apple's business model is to make things even more convenient, allow people to be honest, and offer it at a price that's not much worse than free.
Sure, there are still plenty of people out there just downloading whatever they can find for nothing, just as there are people who shoplift in brick and mortar stores. But that doesn't mean there's no money to be made in selling stuff.
One time I threw a brick at a duck.
Reportedly, one out of every six iPods sold over the Christmas quarter last year was sold in the UK. Apparently they're every bit as popular in the UK as anywhere else.
Apple no longer makes Windows-specific iPods, incidentally. The earlier models were platform-specific, but the models made since April 28th of last year have all been officially Mac-Windows. I would indeed assume the overwhelming majority of those UK iPods are probably being used with Windows, of course.
Credit cards come closest to an international standard for funds transfer, but few Europeans have them
I know of no one who does not have a credit card, with the possible exception of an old relative. I live in the UK. Is it different elsewhere in Europe?
It's hard to find exact statistics. Mastercard claims 3 million cardholders in Belgium, versus 450.000 VISA cardholders. In The Netherlands, the claims are 3 million MC, 2 million Visa. (There may be some overlap there).
Note that Belgium's population numbers 10 million, whereas The Netherlands has 16 million inhabitants, so even if you add up those cardholders, that's only 31% of the Dutch populace, and only 34.5% of the Belgian population that presumably have a credit card (which is not to say they ever use it - I know mine collects dust except for those 4 times a year I use it to buy stuff online; they're also often thrown in as a freebie with a bank's travel insurance).
In other words, if you only accept credit cards, you're scaring away at least 70% of your potential customers.
Note that in the US the number of cards issued stands at more than 700 million. More than 2.3 cards per person.
(This all neglects the fact that only adults can have a card, so the percentages are skewed. Though, not being able to sell to minors is also a disadvantage.)
In my experience, younger people, and people who travel are more likely to have a credit card.
It is said (my sources? google!) that credit card usage in France rivals that of the US, and in the UK and Germany usage levels are about the same.
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