Slashdot Mirror
iTunes Staffers Becomes Music's New Gatekeepers
WSJdpatton writes to mention The Wall Street Journal has a look at how Apple is shaking up the world of music retailing. "Apple -- now one of the largest sellers of music in the U.S. -- offers home-page placement in exchange for things such as exclusive access to new songs, special discount pricing or additional material such as interviews with stars. Most other big retailers, digital and physical, also seek exclusive offerings, but Apple is especially aggressive and has outsize clout when it comes to the slightly out-of-mainstream music it often emphasizes."
50 bucks to the first person who is actually and genuinely surprised by this.
In the United States, it's not illegal to be a monopoly. But, once a monopoly, what was once a competitive advantage becomes criminal conduct.
As a business owner, I'll leverage every advantage I can to the detriment of my competitors, including (but not limited to) absorbing the losses in one marketplace in order to ensure the profits in another, and utilizing my commercial strength in an area to negotiate an advantageous relationship with other vendors.
But in the United States, once you've become a "monopoly", many things that were once expected become criminal actions.
Apple can (and should) leverage their dominance in the music distribution scene to their advantage. As a publicly traded company, it's their fiduciary responsibility to make as money as they can figure out how to do. But if the dominance of the Apple juggernaut continues for much longer, they'll be branded a "monopoly", and then things get pretty complicated pretty fast.
No, I don't think they are a monopoly. (I just bought a Creative Zen to replace my dead iPod, and I'm much happier with the result) But their dominance is... dominating.
Apple needs to tread a bit carefully, methinks.
I have no problem with your religion until you decide it's reason to deprive others of the truth.
This isn't news. This is a standard business practice.
You give me something I want (exclusive offerings), I give you something you want (placement and money).
News Flash: Google provides links to sites who pay for prime placement. Scandalous footage at 11!
All men can fly, but sadly, only in one direction--Down.
It's not like the majority of music purchases in the US or abroad is happening through iTunes or even users of iTunes. Do the editorial staff have an impact? Yes- within iTunes.
Look, if they had that much "power" over what act becomes the next big thing, they (along with the other music services) would be getting more love from the labels, but that's not the case.
Radio, videos, word of mouth- these are all still more powerful than the iTunes ed staff. I'm sure they'll love the ego boost, though.
R(k)
Whenever a recording artist signs on to a label, aren't exclusivity agreements pretty normal? I'd think that an artist abandoning their producing company during a release would result in some form of legal action. So iTunes is being more aggresive. There is only so much premier content space available on the iTunes homepage, while there are a lot of artists. Perhaps there's room for a few more players in the arena.
The bigger challenge for Apple is not how to milk a few rich artists the most, but how to rejuvenate and renew music for the long term.
How will Apple help us to find good new artists worth listening to?
I don't think they're a monopoly and couldn't become one in this space without purchasing or controlling the labels themselves. Additionally they would need to control every outlet for all of that music, not just online.
Apple isn't the first company with an online music store and they have no exclusive deal with any of the labels. Their dominance is self-reinforcing because iTunes is the only way to manage music on your iPod. Maybe that's the monopolistic part you're talking about?
How many iTunes but no iPod customers does Apple have? Likely few. Why? Because there are other ways to buy music. There are other ways to manage your music. There are other ways to listen to your music.
Competition in this space is healthy (although the Ahype around iTunes would have you believe otherwise) and there are enough competitors to offer consumers a choice in how they purchase (or not purchase but stil legally consume) music online. Even if you look at device + music store/library manager Apple isn't alone in this space. Napster has a device. Real partnered with SanDisk late last year and released the Sansa Rhapsody which works with the Rhapsody client software. You can consume that music service through other 3rd party devices like Sonos and Squeezebox. I don't think you can do that with iTunes because they keep the content locked to their devices.
So, I don't know. Yeah, they're popular with iPod users, but iTunes just isn't compelling enough to take over enough of the market by itself to be a monopoly.
R(k)
Today, just before leaving work, I got to listen to some new Sunfire speakers (Bob Carver company) that got overnight air'ed for the Electronic Home trade show in Orlando this week... lets just say that even though I'd lost my ear long ago...this reminded me of just how good music could sound.
Anyway, long story longer...I know online is giving stores a run...but I think as long as there's people dropping $10k on speakers (the cost of the system I heard today for JUST speakers...double or triple it to include everything else), I don't think CDs are going anywhere.
I'm probably wrong but that's my opinion.
Here's a list of what I was listening to: Processor
2700 watt Subs (2!!)
2,800 Watt Amp
Speakers (not the same, but similar to these) **DISCLAIMER** The company I work for owns Sunfire...
Let us hope that we don't trade one evil (RIAA) for another.
okinawa japan
This article says that apple are the new gatekeepers, but more importantly it says that apple does good things with its powers! Instead of taking cash to promote a CD, they only offer promotion in return for "exclusives" and discounts, therefore improving the end-user experience. What's more important however is that they promote independent artists! From the article:
"Groups like Gnarls Barkley have enjoyed significant boosts from iTunes. Last year, the alternative-soul duo's "Crazy" became the first song to hit No. 1 on the British pop charts based solely on digital sales. When the Shins' third album, "Wincing the Night Away," made its debut in January at No. 2 on the Billboard 200 album-sales chart, nearly 30% of the first-week sales were made online"
Does anyone honestly think that The Shins would be so popular without iTune's help? They are a great (semi) indie band, and iTunes promotes LOTS of indie bands. This is far better than the competition such as wal-mart who will only promote stuff put up by the record companies and paid for.
I was suspicious of this article. Apple's statement on DRM annoyed me to no end. Indie bands often plead with iTunes to remove DRM, and Apple refuses. It stands to reason Apple LOVES DRM, otherwise they would implement an opt-out system for DRM for indie artists. However despite the fact that apple is creating a monopoly in this area, they are actually doing good things with it in promoting indie bands!
Musicians can now get exposure using the internet. One example that comes to mind is Lily Allen. Her decision to release her music on MySpace accelerated her career far beyond what would otherwise have happened. http://en.wikipedia.org/wiki/Lily_Allen
An example of an indie band marketing largely on the internet is is the Barenaked Ladies. They seem to be thriving. http://en.wikipedia.org/wiki/Barenaked_Ladies
We have predictions that the RIAA's business model is doomed. I think there's a possibility that 'gatekeepers' of all sorts are going to become a lot less important.
..They just swooped in, spat out some kickass gear, put up itunes, and showed those music exec morons how to do it properly. BAM!
The amount of stuff being produced these days for a consumer would easily overwhelm a consumer with even above-average patience and attention span. This is true in not just music, but in many other sectors/industries (cars, home electronics are other examples).
So, somebody needs to be the "gatekeepers" — we are happy to employ them to avoid missing on the good new stuff while not spending all our time weeding out the bad new stuff. The question is only, who should that be.
In medicines, which we deemed to be too important, we have FDA — a government agency. In everything else there are competing outlets, some of them commercial (think CNet), some not (think Consumer Reports).
The following is a simple truism, but it is needed to counter the article's implicit disapproval: Apple got there, because consumers of music like the work, Apple's experts are doing.
Maybe, it is the dissatisfaction with radio jockeys (think "Payola"), or with MTV, who, presumably, are losing their music gatekeeping role to Apple — I don't know. But should Apple become thought of as abusive of its position, people will switch to others — competition, as is often said, is only a click away.
In Soviet Washington the swamp drains you.
In Capitalist West music corporations complain about Apple controlling access to you.
In Soviet Russia KGB listen to Apple music with you.
Domestic spying is now "Benign Information Gathering"
I don't care since U2 still sucks after all these years. Wheelchairs to the ready !!
"offers home-page placement in exchange for things such as exclusive access to new songs, special discount pricing or additional material such as interviews with stars. "
They're just doing the same thing WallyWorld does.
All this talk of Apple being a monopoly in the music sales dept. and/or being the "new gatekeepers of music" is complete bollocks. Whilst they do have a big catalogue, sell a lot of music, in the end, there is far more music sold on WMA-DRM-based stores that I cannot get via the iTMS than the reverse. Virtually anything I can buy on the iTMS I can buy elsewhere. The 0.x% of songs that might be exclusive to the iTMS does not make the iTMS the mandatory, unavoidable e-store for music that some M$ tools are saying it is.
I mean, eMusic, AudioLunchbox and Magnatunes (who am I forgetting, here?) are the exceptions. In sheer numbers (not marketshare), the vast majority of e-stores are M$-bound.
And then, there are those silly "we cannot sell this WMA music to you because you are not living on our national soil" issues... (I challenge anyone from the USA to buy anything from fnacmusic.com)
So, Apple with the same clout and inevitability (sp?) that M$ has in general computer software? I think not!
Hard to believe Apple is acting like a large, corrupt monopoly. I mean, it isn't like they destroyed their third party support, destroyed their sales channel, and made sure they totally own their retail sales outlets. It also isn't like they have a for-rent OS by coming out with a yearly, $150+ service pack their customers are required to get if they want the latest bug and security fixes.
When we start hearing about Apple signing artists for peanuts and taking away the artist's rights to their own music... color me unsurprised. Apple has always aspired to be a brutal monopolist: their protestations were simple jealousy.
For the kind of music I listen to on an MP3 player through earbuds (hint, this doesn't include Bach or Phillip Glass) I can't tell whether I'm hearing it at full CD quality or 128k MP3, and it's hard to even be sure with vinyl or cassette. Even when I do a comparison, I can't always tell a difference. Music that you dance to or listen to in a bar or at the beach can't depend on low noise and high fidelity... and most of it's got high levels of distortion even in the CD (or vinyl, bad recording levels is an old tradition).
This isn't like vinyl vs CD. I've listened to stuff that's supposed to be "warmer" on vinyl, and I can't tell if the difference I'm hearing is due to the difference in the media, the recording, the player, the headphones, or simply suggestion. But I can sure tell the difference between either and a 160K MP3 or AAC file, regardless of what I'm listening to it on, when I'm listening to classical music or any other music with a high dynamic range.
This doesn't mean CDs will necessarily survive. It just means that there's going to remain a significant (that is, not just the extreme audiophiles) market for higher quality recordings... and publishers will continue meet it, with higher quality or "lossless" formats whether they're sold as bits you download or pressed plastic you bring home from the store.
""In the event that a customers entire music library is lost, the iTunes Music Store does re-grant the purchases history. Please keep in mind that Apple does not offer protection against the loss of purchases, so this is a one-time exception."
Source: http://thecontent.wordpress.com/2006/05/24/itunes
Try that after you've scratched your CDs beyond playability.
The US free market: two halves of a government-granted duopoly are free to set the market price.
Opening the iTunes store now means being shopped and pitched, advertised and shlepped loudly for mediocre TV, movies and music. What started in low-key mode a couple of years ago is now a major exercise in bad taste, a Wal-Martified borough of bad.
No, thanks: if I wanted the latest Disney or Top 40 stuff, there are SUVs and McDonalds and box stores and TV remote controls just waiting to stuff me full of it. Shoot up some botox, find a still-functioning credit card, weaponize the McMansion security system and off to the Wal-Mart!
Goodbye iTMS. Hello, emusic.com.
apple does good things with its powers! Instead of taking cash to promote a CD, they only offer promotion in return for "exclusives" and discounts
This is similar to how Walmart delivers such good "value" - it demands discounts from suppliers desperate to get products on its shelf. In many cases, these discounts mean that a supplier is actually selling some items to Walmart at below cost. So how to maintain margins? Increase prices to other retailers. Effectively, Walmart is obtaining a cash subsidy from the supplier, and extracting it from other retailers.
This is also what itunes is doing by leveraging its strong retail presence to demand "discounts".
Da Blog