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iTunes More Popular Than Most P2P Sites

Posted by Zonk on Tue Jun 07, 2005 05:11 PM
from the paying-its-way dept.
bonch writes "A study by NPD Group shows that iTunes ranks #2 in popularity of music downloads, rivaling services like Limewire, Kazaa, and iMesh. The #1 service was still WinMX, but NPD believes this proves to the music industry that legal downloads can work, and that iTunes provides an economically viable alternative." From the article: "According to NPD, about 4 percent of Internet-enabled households in the nation used a paid music download store in March."
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[+] News: iTunes Sales Ban Does Increase CD Sales 185 comments
Guinnessy writes "According to the New York Times, some music labels have deliberately stopped selling some new singles on online stories such as iTunes or Rhapsody while promoting songs on the radio, so that listeners will rush out to buy the CD album instead. The album appears in itunes at a later date. Not everyone seems to think this is a good idea. From the article: 'The labels are shooting themselves in the foot,' says Rhapsody's Tim Quirk. However, Ne-Yo's CD In My Own Words sold 301,000 copies using this method. Chris Brown's Run It, that was in the itunes store, sold 154,000 copies in its first week. Ne-Yo's So Sick was downloaded approximately 3.4 million times on the peer to peer networks during the week of his album release while the album Run It!"was downloaded approximately 5.3 million times in the same release period."
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  • by geomon (78680) on Tuesday June 07 2005, @05:12PM (#12752298) Homepage Journal
    Although there are still millions of people who will continue to trade on p2p, having legitimate outlets supplying digital copies of music, television, and movies will become a hugely profitable venture for the entertainment industry. They just haven't figured out how to do it and still capture the largest share of the market.

    A radio program this morning on NPR discussed how the movie industry was losing money on opening day box office receipts at the same time they are making a killing with DVD sales ($17BUSD). That means that they are going to have to change not only their marketing (opening day receipts are generally a 16-24 year old market), but also their metric for gauging success.

    Overall, once they stop focusing all of their energy on litigation and lobbying for worthless copy-protection standards, they will begin to create a market-driven system that people will gravitate to and embrace.
    • by Alaren (682568) on Tuesday June 07 2005, @05:19PM (#12752370) Homepage

      "...once they stop focusing all of their energy on litigation and lobbying for worthless copy-protection standards, they will begin to create a market-driven system that people will gravitate to and embrace."

      STUDIO EXECUTIVE: "So if we... try to gain favor with... let me see if I've got this... our customers... instead of pushing them around and spending all our efforts on advertising instead of actual, innovative, interesting products... we'll make more money?"

      "That's so crazy it just might work!"

      How do these people come to be in charge of multimillion dollar companies? This should really be obvious, folks.

      • by geomon (78680) on Tuesday June 07 2005, @05:25PM (#12752430) Homepage Journal
        How do these people come to be in charge of multimillion dollar companies? This should really be obvious, folks.

        Its funny that you made the same comment, in a different way, as the commenter on NPR. They said something to the effect that "these people [entertainment execs] are really smart and will eventtually figure this out".

        Until now, of course, all they have shown is that they are frightened asswipes with souless lawyers at the ready.
    • Are you kidding?

      This new-fangled form of distribution is going to ruin all creativity as we know it! Just like the VCR killed all movie production and Xerox ruined the publishing industry! We're doomed! Dinner is Ruined! We cant have nice things!

      • You're assuming that the litigation and copy-protection has had no influence on the results we're seeing.

        True, but the only way that the industry will move forward is by finding a way to work with the system as it exists today.

        Even if they were to successfully destroy the current system, it will come back at some point in the future and the next person/company will make the money they should be making now.
      • by geomon (78680) on Tuesday June 07 2005, @05:33PM (#12752520) Homepage Journal
        I think you mean they're losing money on total box office receipts.

        No, although the total office receipts are dropping too.

        Or are they expecting to pay for all the production & distribution costs and then some from a single day's ticket sales?

        No, they were using opening day receipts as a guage on how many units they would ship to Blockbuster and other rental outlets. The popularity movie as a rental was a function of how well it did opening day.
  • by linuxbaby (124641) * on Tuesday June 07 2005, @05:13PM (#12752313)
    My company [cdbaby.net] is one of the main distributors of music to Apple iTunes, Rhapsody, Napster, etc.

    I gotta admit that when we started doing digital distribution two years ago, I thought it would be just a small income stream for the musicians - some extra income, maybe $5k/month combined.

    But our checks from Apple et al have been over $300,000 a month so far this year! And that's just for our catalog of mostly-unknown all-independent music. (And hey for the record, 91% of all that income goes directly to the musician.)

    NOTE: a lot of this discovery of independent music is thanks to cover songs [cdbaby.org] - another twist I never expected.

    Yes us alpha-geeks here on Slashdot may get our music from allofmp3.com or SoulSeek or whatever, but there's definitely millions paying that 99-cents-per song, or $20/month subscription out there. I get to see the detailed sales reports every month.

    (Personally, I'm so impressed with Yahoo Music Unlimited [yahoo.com], that it's making me want to use Windows again!)

    • NOTE: a lot of this discovery of independent music is thanks to cover songs - another twist I never expected

      The first lesson a band learns is that bookings come easier when you do covers.

    • Since you seem to work in the industry, an idea for you- I'd be more than happy to pay 10 or 20 a month for a Yahoo like deal. But not under the current conditions. I want to own the music, not rent it (meaning if I decide to quit paying, I can still play my files). And I want it in a no DRM format (MP3 is fine). Get that, and you'll have a lifelong customer. Until then, none of these sites will be seeing my money- I refuse to buy DRM, and I don't want to pay per song (or album).
      • by rkcallaghan (858110) on Tuesday June 07 2005, @08:51PM (#12753947)
        Parent: any chance you'll use that 300k a month to drop the price of these independent albums to sub $10 each?

        Are you smoking the ganj, man? You demonstrated you read the post, but I think you missed this:

        GP:91% of all that income goes directly to the musician.

        300k - 91% = 27k left to pay hosting/bandwidth costs, advertising, any employees that need to be paid, any other costs of doing business, oh yea and 4) PROFIT!!.

        I know the RIAA has left us gun shy of the words "music" and "profit" together; but he's paying the artists fairly and giving everyone the same fair shot. This guy isn't using any industry stranglehold on politicians & airwaves to artificially pump up the prices.

        ~Rebecca
  • Stand by for BS (Score:3, Insightful)

    by am46n (615794) on Tuesday June 07 2005, @05:15PM (#12752328)
    Stand by for a bunch of /.ers, pretending to be representitive of the average consumer, posting as anonymous coward to tell us all how many tracks they pirated versus bought in the last week, and how this proves the stats are wrong.
  • Most of it has so much DRM that it is unusable.

    What will happen when Apple goes bankrupt? Or when the next generation of mini-players comes out with a new DRM?

    People are paying for music, then being told how they can use it.

    Fair use is simple. I can make as many copies for myself as I want. Many DRM's make it impossible to make even a back up copy. But what if I want one copy for my MP3 player, one on a CD for my car, and one for my wifes car? Does that mean I must buy three copies?

    • by SuperKendall (25149) * on Tuesday June 07 2005, @06:10PM (#12752877)
      What will happen when Apple goes bankrupt? Or when the next generation of mini-players comes out with a new DRM?

      You must be thinking of the OTHER music companies, that re-authorize every month or what have you.

      If Apple went out of buisiness, you music would continue to play on your current Mac until the end of time.

      However, like you say eventually you'd want to move the music. Two options then:

      CD's - I can burn any ITMS song to CD as much as I like (limit of ten burns a playlist, but I can always make new playlists...)

      Hymn [hymn-project.org] - I can convert protected AAC files into unprotected AAC files, which I can then play on anything that undrestands AAC (most PC players, not many portables) or convert it from there.

      So yeah I feel sorry for anyone buying music from anywhere other than ITMS or AllOfMP3.com. I still don't like to use AllOfMP3 though as I don't feel it gives artists as much as it should. Perhaps in the future I'll buy from ITMS, then buy the non-lossy version from AllOfMP3. Too much work though, so I probably wont...
  • Speed of Sound (Score:5, Informative)

    by LittleGuernica (736577) on Tuesday June 07 2005, @05:19PM (#12752373) Homepage
    Coldplay's new single "speed of Sound" sold extremely well thru itunes, thats because it was released the day after the first airplay. I run a Coldplay fansite ( http://closingwealls.net/ [closingwealls.net] - blatant plug) and following the news around the band, it seems that the single was one of the most downloaded songs ever on itunes, because of that fact. This has proven to be a very succesfull formula. Publish the single online the same day as it hits the airwaves, and people dont have to listen to the radio to hear it, for a tiny dollat they can lsiten it legally whenevewr they want. thats a huge incentive. Of all the legal downloadservices, iTunes gets it the best and is probably right that subscriptions dont work.
  • iTunes safer (Score:5, Insightful)

    by PenguinBoyDave (806137) <david@nOSpAM.davidmeyer.org> on Tuesday June 07 2005, @05:19PM (#12752376)
    For me it comes down to one thing...iTunes subscription ensures I'll not end up on the wrong end of a lawsuit. I can't afford the fines, and I'm not interested in trying to dodge getting caught. Not worth the risk for me.
  • by Anonymous Coward on Tuesday June 07 2005, @05:19PM (#12752377)
    Nobody shares. Not one. Take a look for yourself. Everything is hosted by Apple. At least on the other services, people share. I guess all the iTunes users are behind NAT firewalls.
  • by geekee (591277) on Tuesday June 07 2005, @05:34PM (#12752528)
    according to slyk [slyck.com], p2p users are over 10 million, which is more than 5 times the number of people using iTunes. And p2p use is growing, not shrinking.
  • by Gauchito (657370) on Tuesday June 07 2005, @05:39PM (#12752577)
    I used to use Kazaa/Limewire to download my music before, but now I'm almost exclusively an iTunes man. I still use Kazaa for things I can't find on iTunes, but immediately buy it legally when they become available.

    I can think of several factors. First, of course, the quality of the music is much better in AAC than the ripped mp3's you find online. Second, you don't get screwed by fake or misnamed files, truncated versions, or the whole other slew of crappy files you find through P2P. Third, the legality of it vs P2P is appealing, especially when you get older and you start worrying more about not making mistakes you'll regret later.

    Fourth (and I think this one is very important, which is why I gave it its own paragraph) the interface to iTunes makes it so, so easy. Not only the iPod integration, but just the fact that making the actual purchase (after you login) is so smooth, you forget at the time you're actually spending $1 per song. You just click on the buy song button, the song is downloaded (and iTunes is still very useable while the song is being downloaded), and you don't even think that you will be billed for it later. The $1's add up, of course, but it took me a while to look at my collection and realize I had just spent $200 on music I could have gotten for free (had I really wanted to). On P2P it involves placing a search, looking through the hundreds of results you get back to find a version that looks legit and has the bitrate you want, hope that the file will still be available throughout the entire download, then wait while you're access to the song is limited by the slowest peer you're getting it from.

    About the only reason, besides the cost savings, I can think of for still going to P2P for music is if you have a music player other than an iPod and don't want to go through the hassle of burning the song to a CD before you can rerip and transfer it to the player. Unless, of course, there are AAC to mp3/ogg/wmv converters out there than can convert Apple's DRMed version, and if there are, please tell me where, because I've looked and haven't been able to find any that work.
  • General Observation (Score:5, Informative)

    by microcars (708223) on Tuesday June 07 2005, @05:55PM (#12752712) Homepage
    generally what I've noticed is that people who don't have the money to BUY music will download it via P2P.

    Nothing really lost, they weren't going to buy it anyways.

    BUT, when they DO have money...they BUY their music, either on CD or via iTunes or some other vendor.

    When your TIME becomes WORTH something you don't SPEND it all on P2P.

    I don't know, that's what I see going on around me....

    • Re:WinMX is not #1 (Score:4, Informative)

      by Uber Banker (655221) on Tuesday June 07 2005, @05:27PM (#12752452)
      Yeah, WinMX [winmx.com] doesn't work. Only fools would use spyware free P2P apps that have barely been updated in 2 years.

      Of course the reason for the WinMX software not to get updated for 2 years is coz it doesn't work, right? And the queues, they're there only to allow RIAA stooges to log your IP manually, and the users who say "you don't share enough", they're MPAA hooks using entrapment tactics. And the range of rare content is because only eclectic people use it.

      May WinMX continue to suck.
    • Re:Great but.. (Score:5, Insightful)

      by mh101 (620659) on Tuesday June 07 2005, @06:12PM (#12752894)
      As for an example, if I pay for all these songs and my computer would happen to crash, and it would just happen that I don't have a backup copy, I've essentially payed for something I don't have anymore.

      And this is different from physical CD purchases how? Let's say you have a CD, and it gets damaged or lost. Same scenario here, you've paid for something you don't have anymore.

      With both scenarios, you have two options - back up your music (whether by burning a data CD/DVD of iTMS purchases or ripping your CD to MP3), or risk losing your music.

      You do have a valid point, and I do agree with you, that it would be nice if your Apple ID also facilitated in keeping a record of all music you've purchased in case you need to re-download them.