Apple Sells A Million Songs in Debut Week 841
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..."
Hooray (Score:4, Interesting)
Tidbits and the future of iTunes Music Store (Score:5, Interesting)
They also discuss the future of iTunes Music Store, quoting from the article:
Future Moves -- Keep in mind that the iTunes Music Store is a 1.0 release, so there's plenty of room for improvement, such as the following features.
I'd like to see Apple expose the links to every track available in the iTunes Music Store, perhaps along with a new URL scheme that would make it trivial to click a link in a Web browser and jump to the song's listing in iTunes. Utilities would undoubtedly appear to let people build Web pages of their purchased songs for showing friends and other visitors. It appears the necessary bits may already be in place; see the link below.
<http://nslog.com/ archives/ 2003/ 04/ 29/ itms_ links.php [nslog.com]>
Also interesting would be music recommendations via the social information filtering researched at the MIT Media Lab (the Ringo music recommendation project) and then tried (unsuccessfully) in the business world as Firefly Networks. The iTunes Music Store already has Amazon-like "Listeners who bought this also bought" links.
<http://www.acm.org/ sigchi/ chi95/ Electronic/ documnts/ papers/ us_ bdy.htm [acm.org]>
Along the same lines, popularity rankings and user comments would also be welcome, much like those on Amazon.
Providing full liner notes, preferably with lyrics, would undoubtedly help some people decide what to buy. However, I'm sure the contractual issues surrounding lyrics are complex.
I'm fairly unlikely to buy an unknown song based on a 30 second clip. I'd like to see Apple instead stream a low quality version of the entire track. Even better, Apple could create a number of iTunes-based streaming radio stations in different genres. If you like the current (or recent) song, you could click a Buy button to download it instantly.
I gather iTunes users with children are interested in some level of parental control over purchases. Something as simple as password-protection for opening the iTunes Music Store itself would suffice.
There's currently no way to buy music as a gift currently, but it would be nice to be able to buy a song or album for someone and have Apple automatically send them an iCard with the download link.
Realistically, modem users aren't going to be able to use the iTunes Music Store much, but perhaps a future incarnation could offer a mechanism by which Apple would send you a CD containing the AAC files for an additional cost.
Re:Keeping their promise on adding stuff, too (Score:0, Interesting)
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 ?????
Proof of brand importance? (Score:5, Interesting)
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.
adding your own album (Score:5, Interesting)
Re:Me thinks CmdrTaco gets an Ipod Free.. (Score:5, Interesting)
3. Profit? (Score:5, Interesting)
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...
Putting 1 million songs into perspective... (Score:4, Interesting)
I hope this doesn't rescue the recording industry. (Score:5, Interesting)
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.
One thing I find suprising (Score:1, Interesting)
Re:Why did it work? (Score:5, Interesting)
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.
Re:Proof of brand importance? (Score:5, Interesting)
Put simply, it's both. Apple has great brand recognition, marketing muscle and a loyal customer base. But none of that should take away from the fact that this is a significant advance in implimentation.
How? Well, basically the only games in town for legit online music downloading involved one or more of the following onerous "gotchas."
1. Rental of music. That is, you don't pay your monthly subscription, you can't listen to "your" music anymore. At $20 per month, this starts to get pretty stupid. No mystery why this never took off.
2. Over-zealous DRM after downloading. Once the file is on your computer you can't burn a CD. Or you can, but only certain tracks. Or only if you pay an additional fee. Only one CD, please. Etc., etc., etc. Transferring the file to another machine? Hassle. Quibbles about Apple's "Fairplay" DRM technologies notwithstanding, they're lightyears ahead of what came before.
Apple hasn't gotten it 100% right, but they clearly are hitting the 95% mark and one expects the model to be refined further still. Other services have been consistently below the 50% if you ask me. Not that it was their fault! The RIAA basically either owned these downloading services or at the very least severely restricted the terms of the music licenses. That is to say, the RIAA killed those other services before they were born.
One of the greatest achievements of the iTMS isn't the fact that clever Apple engineers came up with a great idea first - hell, everyone knew the basics of what was needed for online music downloading business to be sucessful. But the RIAA wouldn't allow such a model! No, cleverness aside, the great achievement is the fact that the Big Steve managed to convince the record companies that his model was a good idea for them. Obviously they had rejected such liberal, consumer-friendly models countless times before. I'm recalling a quote from the top guy at Sony that said (paraphrasing here!) "I think it was about fifteen seconds after Steve started talking that I decided to license our entire library to him."
"Reality Distortion Field"? Maybe. However he did it, he managed to get the RIAA to swallow a viable music downloading business model. Viable because it contains enough rights for customers for them to put down their hard earned cash and enough controls for content providers to put up their wares.
Make money in the ipods and switchers...not music (Score:2, Interesting)
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.
Re:Proof of brand importance? (Score:3, Interesting)
#1. iTunes is a very good way of delivering the music. My wife downloaded an album (Mr. Heartbreak by Laurie Anderson) and in about a minute it started playing while downloading the rest. It downloaded FASTER than it would have taken to rip the music ourself. As my wife said, if you need to get an album for some reason quickly (going to a dance party and you want to bring it) you can download an album and be out the door in 10 minutes (if you have an ipod)...
#2. Steve Jobs. His ability to get the labels and artists in line to make this work from the first moment is a real testimony to his ability as a salesman. Obviously the idea of internet music distribution wasn't invented by Apple. Yes the hype helped as well. People were waiting for the music store. While the first week Million song release is exciting I am curious to see if it expands. Will we see a million a week as the basic? Will it be like movies with drop off? Or will it be 2 million a week by next month. I note that both Warner Bros and Universal were quoted in that press release, so it is clear that they are tightly tied into this venture.
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It seems strange that something that has existed for so many years and had commercial ventures already (distribution of music) might be the killer app for the digital hub concept.
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I do know that as long as record stores are selling albums that weren't even digitally mastered for 15 bucks, 9.99 per album is gonna be a real seller. I also assume that Apple will find ways to create promotions that will even improve that price point.
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AAC Compatible Players (Besides the iPod) (Score:2, Interesting)
Microsoft will win (Score:2, Interesting)
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?
Re:Why did it work? (Score:3, Interesting)
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
Re:Notice how a couple record execs applauded (Score:3, Interesting)
Apple started this (I wouldn't be surprised if Steve has had this in mind for some time, wanting to be the "savior" of the music industry), its better than everything out there (except maybe eMusic, cheap, unrestricted, and offers lots of great indie stuff at around 192 kbits), and its doing quite well with a small user base, right out of the gate. Why complain?
Hopefully apple will be able to turn out an iTunes port sooner than the end of the year to increase the user base.
What about resale value? (Score:2, Interesting)
Re:Hooray (Score:5, Interesting)
I think that you are mistaken here. Apple doesn't need any more contracts, since it already has contracts with all five of the major labels, and the independent labels are reportedly itching to get in on it as well! The model has succeeded already, by giving us a way to purchase current music legally and easily electronically. This is a good thing.
Now, as far as the RIAA is concerned, and your comments about artist compensation, a lot remains to be seen. I envision independent artists and smaller labels being able to distribute music much easier through the iTunes Music Store, and offering them potential for success. They could release a few "singles" for free on the Music Store, and then hope that people buy more songs, or the whole album. And since they aren't producing any CDs, they have less overhead, and can get more of the profits. Just a thought on how the future could be bright.
Re:Hooray (Score:2, Interesting)
Hmm.. let's call it a draw: From the Star Wars Databank [starwars.com].
AAC questions (Score:3, Interesting)
Just curious, I don't own a Mac and I stopped using p2p nets.
Re:About what I thought (Score:2, Interesting)
Yes, you are missing something (Score:2, Interesting)
Re:About what I thought (Score:3, Interesting)
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...$8 if I didn't download the dumb 40 second intro.
Re:$.99 for low quality DRM files?????? (Score:5, Interesting)
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.
Re:What Am I Missing? (Score:0, Interesting)
> 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.
Re:Why did it work? (Score:2, Interesting)
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.
Re:AND the AAC files are locked to YOUR Macs (Score:3, Interesting)
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).
Lots of Questions (Score:5, Interesting)
I showed a PC user iTunes (Score:3, Interesting)
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
Rocket Science (Score:3, Interesting)
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 :)
Why the Apple Music Store Works (Score:3, Interesting)
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.
Re:3. Profit? (Score:3, Interesting)
Not to mention that, while I'm sure they are thrilled to make money on selling music, Apple is a COMPUTER company. All of the hype for the iTunes Music Service is free advertising for the Macintosh. It is sure to help boost sales of Macs, MacOS X 10.2, iPods, and all the other little goodies Apple sells.
It's like the Apple stores, even if the Apple stores or the music business break 100% even, they will still be worth it for the advertising value.
Re:I hope this doesn't rescue the recording indust (Score:5, Interesting)
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.
Imagine an Apple and Priceline joint venture (Score:4, Interesting)
On this same topic... (Score:4, Interesting)
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.
Re:Proof of brand importance? (Score:4, Interesting)
In riposte to your statement "the popular contender to iTunes seems to be eMusic", that simply isn't true. The contender vs. iTunes is kazaa and edonkey2k. The public will have to decide whether to get its pop music for free via a less-than-perfect distribution system (long queues, bad rips, madonna telling you to eff off) or pay for no queues, good rips, and the music you want. Not that iTunes is perfect either (several bugs in signing up if you already have an account, drm encumbered, relatively small selection). But I have faith that two of those three will clear up, and the third is livable, while the p2p side has had several years to get their act together and replicate napster at it's peak (which was unbeatable in all three areas), but they haven't come close.
All the previous is coming from someone who is a current eMusic member, and has bought stuff from iTunes. I will get much *more* music from eMusic, because when you get right down to it techno is almost all interchangeable so the more you have the better, and you don't have to be *overly* picky about choosing just 'the good stuff'. But when I want to get Coldplay's third album, or REMs next, or whatever, I'll probably use iTunes to do it.
I have no idea if any of this actually answers your root question, I'm just rambling at this point. Thanks for reading this far!
But it's not a fair price (Score:2, Interesting)
Full Duplex sound card? (Score:1, Interesting)
Re:Business Model for the Weight of the Ages (Score:3, Interesting)
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!