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MP3 Market Approaching Critical Mass
An anonymous reader writes "Led by the Apple iPod, Jupiter Research says that sales of DAPs are reaching a point where it will ignite an industry of support products and services. According to Jupiter analyst David Card
'Historically, any new device or medium that reaches a U.S. household penetration of 15 percent to 20 percent creates a critical mass of customers for other products and services.' The iPod already has a slew of peripherals out there and this is particularly good news for the paid download services like iTunes, especially with Apple announcing Wednesday they sold another 5.3 million iPods last quarter."
...another News.com article on this topic:
Music moguls trumped by Steve Jobs?
When Apple Computer CEO Steve Jobs walked into the suites of top record label executives in 2002, iTunes software in hand, he was welcomed as a trailblazer to a digital music future.
Now, nearly two years after Apple's iTunes launch, record executives have become worried that they have inadvertently ceded too much power over their industry to this charismatic computer executive.
Frustrated at what they see as Jobs' intransigence on song pricing and other issues, some record executives are now turning their hopes toward other partners, particularly mobile phone carriers eager to get into the business of selling music. They see this new focus as a way to broaden the digital music business, and lessen Apple's dominance over their market in the process.
[...]
For example, Apple wants to sell all its songs for 99 cents each, a single price point that's easy for consumers to understand. But the record labels have pressed for the ability to vary prices to maximize their own sales. They want to sell older titles at a discount--like the $9.99 CDs available in most record stores--and charge more for popular songs to take advantage of market demand.
Full story
I understand that the iPod craze has been great for Apple, but I wonder how many people actually buy those accessories that are available (such as the voice recorder and FM transmitter). It's one thing to pay a premium for a high-quality Apple iPod; it's another thing to pay $30 for a an add-on - for features that come standard with other MP3 devices!
Cripes. These iPods are like Rabbits in Australia!
Quid festinatio swallonis est aetherfuga inonusti?
Africus aut Europaeus?
I love that term, it makes it sound like there'll be an explosion. Everyone stop buying i-pods! it's our only hope!
When I can get one of these in the US for less than $100, then I will agree. Until then, there is more mass to be had before criticality.
Now, nearly two years after Apple's iTunes launch, record executives have become worried that they have inadvertently ceded too much power over their industry to this charismatic computer executive.
Frustrated at what they see as Jobs' intransigence on song pricing and other issues, some record executives are now turning their hopes toward other partners...
Cripes, this is so damn typical of the entertainment industry. They're so interested in screwing everyone they can for a buck that the minute someone is successful using their property, they feel they need to bite back. It's rather like watching a bunch of cavemen around the first fire. One gets burned so they all put the fire out with their clubs, then thump their chests and hoot in victory before sitting around in the dark and cold again.
I think RIAA deserves the Duh! Prize (if there was one.) Next year or so it'll be the MPAA doing the same thing.
A feeling of having made the same mistake before: Deja Foobar
Your reading of the stockmarket is pretty shortsighted, I think. The correction which plagues apple stock right this moment is a crisis of faith; the looking for miracles rather than a logical progression of business. it's hard to imagine the ipod being more of success right now, or apple's star to look any brighter in the future.
The idea of a critical mass has a beautiful ring to it, but it is the fundamentals and the continued approach to success which will continue Apple's ascension. It doesn't really matter what the marketplace will bring; with leadership like Jobs is showing the momentum seems like it will just continue.
I know a few people who spent their unemployment checks on iPods.
Gotta have priorities.
--
the strongest word is still the word "free"
When will the quality of music reach tolerable mass?
If MP3 players are rapidly approaching critical mass, how long will it take before car stereos will feature minijack inputs as standard?
Considering the cost of including one versus the cost of replacing the deck so that you can plug your MP3 player in, why wouldn't more manufacturers be doing this? I know a few are, but I'm in the market for a new car and the deck that comes with it figures into the real cost. Replacing the stock stereo with one that will take input from my MP3 player should be unneccessary if these things are really at critical mass.
Synergy is your friend
They were talking about this on NPR yesterday, but instead of "critical mass" they called it market saturation.
Thats why Apple's stock took a dump yesterday
Problem for apple is that everyone already has an ipod and it will be tough to find new people to sell to.
Top 10 Reasons To Procrastinate
10.
Is anyone else suddenly feeling the overwhelming urge to chamber a round into their shotgun? Is this the same Jupiter that is hell-bent on screwing over the internet with spyware and adware? If so, how on god's green earth is it that we're taking their "research" seriously?
The iPod craze is officially over, because Jupiter Research said it is about to explode. Thanks, Jupiter! Thanks a lot!
These are guys who hyped "New Economy" companies until the dot-com bubble burst. With their razor scooters and their afros, they literally destroyed billions of dollars in market capitalization. There is no Earthly trend so massive, no business plan so potent, that Jupiter Research cannot destroy it.
That's why they are called Jupiter. They are big. They have a lot of destructive gravity. And they are made ENTIRELY of gas.
Yep, these are the guys who proclaimed that "home taping is killing music" back in the 1980, and killed off DAT in the 1990s. The MPAA cried bloody murder when VHS hit the market, but amazingly the global film industry is still quite robust.
What really cracks me up is that the RIAA had their heads so far up their asses that they had *no strategy* whatsoever for online music sales until Jobs came along and offered them a way out. Now that they have a path away from stupidity, they're trying to jack prices up again, the same way they did with CDs.
It's like they're fundamentally unprepared to realize that the landscape is changing and that they can't make the same margins they used to make per song. They have to shift their entire way of doing business, but they're so fat and happy that it's like Jabba the Hut doing the long jump.
Read the EFF's Fair Use FAQ
Don't people understand that it is dangerous to ride a bicycle while listening to music!?
I agree with the grandparent post. "RIAA" is not a valid shorthand for "The Record Companies."
First of all, the RIAA is an organization which includes labels, artists, engineers, and many others who are connected in one way or another to the recording industry. That little set of preamp-adjusted ports in your dad's stereo that he plugs his turntable into? That is an example of an RIAA standard.
Secondly, the labels have been using "RIAA" as the plaintiff in several unpopular lawsuits for the specific purpose of getting people like you to think "damn RIAA" instead of "damn Sony, RCA, Virgin" when you get upset about your rights being trampled on. That way, folks keep buying their products like good little sheep without realizing who they should really be upset with. When you use "RIAA" as a "shorthand" for the real bad guys, you are helping their cause.
Information wants to be anthropomorphized.
Errr.... no. In many industries, having a range of prices, especially that vary with time, allows not only for greater profits, but for larger numbers of satisfied customers. The math is a bit more involuted than a simple supply/demand scissors curve, because you also have to factor in substitutibility, price elasticity, and information costs, and time value of money, but in many situations this allows for a good thing all around.
This is one reason why grocery stores have sales; people who would not ordinarily buy a product at price X will consider buying it at price 0.9X. Furthermore, it's one reason why grocery stores accept manufacturers coupons; the customer gets a lower price, the grocery store gets slightly more money (for slightly more hassle), and the increased sales (and potentially increased regular customers) result in net higher profits for the manufacturer.
In this case, the RIAA is wishing that they could run the backcatalog at a discount, while charging a premium for newest releases. And if they were willing to, say, knock $0.24 off their current $0.65 share of the price for releases over 10 years old, while adding $0.01 to the recent releases and $0.25 to items released within the last year, I'd consider it likely to be a net benefit for consumers overall.
Someone with more background in economics and without a head cold might explain it better, but it comes down to: the ability for suppliers to have prices that vary is a good thing for the consumer. Unnaturally fixed prices (such as, say, when fixed by a cartel) are bad.
//Information does not want to be free; it wants to breed.
I think it is unfair to mod this as "offtopic." After all, we are talking about Apple. And Apple, much like Christianity, was founded by a messianic, charismatic figure who could perform wondrous miracles, such as turn water into wine or OS 9 into OSX. Is the Sermon on the Mount not unlike a MacWorld keynote? Did Steve not suffer for our sins at the hands of the prefect Sculley? Did he not wander in the wilderness before retuning to us with the UNIX keys to our salvation?
"Steve, I am not worthy to receive you, but only say the word and I shall buy a maxed-out 17 inch PowerBook and a top-of-the-line iPod."
Machiavelli, a graphic novel