Apple Is Now the #1 US Music Retailer 251
Quantrell writes "A leaked e-mail shows that Apple hit the #1 spot for music sales in January. The article speculates that consumers cashing in their holiday gift cards may have played a role; but of course Wal-Mart and the other retailers sold gift cards too. The news is a mixed bag for the record labels. 'For the music industry, there is a dark side to Apple's ascension to the top of the charts. Buying patterns for digital downloads are different, as customers are far more likely to cherry pick a favorite track or two from an album than purchase the whole thing. In contrast, brick-and-mortar sales are predominantly high-margin CDs.'" We recently discussed Wal-Mart's role in the music business, back when they were selling nearly 20% of US music. For January Apple was at 19% and Wal-Mart at 15%.
And that means (Score:2, Insightful)
It's Apple iTunes with DRM Forever!
one future of music distribution (Score:3, Insightful)
i say "one future of music distribution" because i am also leaning towards this idea [arstechnica.com]
Re:And that means (Score:5, Insightful)
Correlation and Conjecture (Score:5, Insightful)
Not so much a mixed bag as it is further evidence that the RIAAs business model is flawed.
Here they have the worlds largest brick-and-mortar store and the most influential online music retailers moving ungodly units of their crappy products and still they cry poverty.
Re:And that means (Score:1, Insightful)
Seriously, can we get a -1 Apologist choice for moderation?
Uh-oh (Score:4, Insightful)
Re:Could be. (Score:4, Insightful)
No, no it won't.
You or I can still make recordings and distribute them with or without DRM if we wish.
It'll just mean we can't (easily) make copies.
I agree, it's a worse situation than what we have now, but it's not like pre-taping days in that the tools are available to all to distribute media.
Re:one future of music distribution (Score:5, Insightful)
Do you really think it shows that? I don't.
I think it shows that people are ever more shallow in their music tastes and now only want those one or two big hits, ignoring the rest of the material. How many times have you listened to an album, or an artist's entire catalogue, and come to love one of the b-sides or album tracks more than the one or two big hits? For me it's a lot.
But then I suppose I'm not buying Britney or whatever the big thing is that the idiot children listen to these days.
Re:Dark Side for Both Apple & Wal-Mart (Score:-1, Insightful)
Re:Dark Side for Both Apple & Wal-Mart (Score:2, Insightful)
Re:And that means (Score:5, Insightful)
You should be thankful for Apple and the fact that they are #1. It's because of Apple that the labels have allowed Amazon to sell MP3's without any kind of DRM whatsoever. If Apple had never gotten such a stranglehold on the digital marketplace, most of the labels would have never allowed Amazon to sell DRM free music. I'm glad that Apple is where it is and I hope that people continue to buy music from them. I won't be among them but as long as Apple keeps doing what it's doing, the labels will allow Amazon and others to sell music without DRM as a counterweight and smart consumers will be able to purchase legit, DRM free music.
Re:And that means (Score:5, Insightful)
Re:Uh-oh (Score:4, Insightful)
Re:And that means (Score:2, Insightful)
Face it Apple loves DRM. Especially because the RIAA demands it. He gets to pretend he hates DRM to get in good with the consumers but that's exactly what's providing a lock-in to Apple brand media players. If Apple hated DRM as much as is claimed they wouldn't have a problem licensing their DRM out to Microsoft, or Sansa.
I know that Apple is the best underdog we have to root for against Microsoft but if one examines their business practices you gotta admit they're taking a lot of plays from Redmond's book. If the iTunes-iPod marriage isn't enough evidence for you I figured the iPhone SDK would be. </rant>
Re:So what? (Score:3, Insightful)
Also, don't forget that a lot of advertising costs can probably be saved using the iTunes store. Consumers get to try before they buy, find tracks similar to ones they already have, and so on. it's not just cost savings related to manufacturing, shipping, and retail space.
That's not good enough. (Score:3, Insightful)
I thought about this for a while and don't like it. Replacing the RIAA with Apple is not the equivalent of creating a free market for music. With digital restrictions, Apple will be in charge in a way that the RIAA was but worse. You say:
Apple will sell just about anything. Several talk radio hosts have regular iTunes paid downloads, and none of them have RIAA contracts.
It sounds good, but I can replace the words like this:
Future_monopoly will sell just about anything. Several talk radio hosts have regular future_Tunes paid downloads, and none of them have Apple contracts
It's the concentration of power that's evil and leads to abuse.
Re:one future of music distribution (Score:2, Insightful)
Some quick background - I was involved with a fringe music scene for about 15 years, from the late 80s until the early 00s. It will take much more than changes in the business side of music to stop the artistic side. How we get to the art will change - it has changed. The good news: it's easier and cheaper for artists to produce super-high-quality music. Distribution is near-free. Motivated, talented folks can keep more $$ in their pocket if they choose. Contrast this to just a decade ago - why, in the mid-nineties, burnable CDs cost dollars and not cents to utilize. The bad news: it's easier and cheaper for artists to produce. The noise-to-art ratio is high (by anyone's definition of 'art'), and the business side is scrambling to keep a hold of the cash cow, dangling the "promote or die, and we can afford it" carrot in front of the artist.
Oh, and by consumption I didn't necessarily mean purchase. I just meant that if people produce music and don't release it or play it for anyone, it is of no consequence. As soon as it is released or made available, the creative and business forces behind it will be subject to market forces and critique. It's a given - and it doesn't have to be popular to be consumed (or have merit), nor does popularity == more consumption == better art. But if you put something out there, people will choose their mode of consumption - single song, ignored, popular, mega-sales, (il)legal downloading... whatever.
If you're interested in stuff seeing the light of day, check out CD-Baby http://www.cdbaby.com/ [cdbaby.com] . Type in your favorite band or genre, and get served up a whole host of music. I guarantee you will like at least 10 or 20% of it, and that you will have heard of little or none of it. As a distribution network, they are fair and honest, they pay the artists what they say they will (and on time).
There. Now please mod me down off-topic.
For all of you griping about Apple's DRM (Score:5, Insightful)
Re:And that means (Score:5, Insightful)
Apple sells DRM free tracks. But how many people do you know that buy from iTMS that have a DRM free collection? Even if you bought just one DRMed album, you'd have to keep using Apple's products to maintain that investment.
Don't get me wrong. I have an iPod. But I refuse to buy from iTMS. I'd rather give the same money to Amazon and get my tracks in plain unencumbered MP3.
Re:Dark Side for Both Apple & Wal-Mart (Score:3, Insightful)
Not that I'm a Britney fan, but let's build on this logic. I'll simplify the numbers for the discussion.
The price is $12 for album B. If they make it available separately, the price is $2 for the mega-hit cut three or B3, and the price is also $2 for the lame stinkers B1, B2, B4, B5... B8. In aggregate, buying B is cheaper than buying B1...B8 a la carte. However, if buying B is the only way to get B3, and nobody wants the other cuts, then the value proposition is too low. The labels decry this sort of fate: they fear that each B buyer will be converted to a B3 buyer, and revenue will drop horribly because almost nobody likes the seven filler cuts.
What is overlooked is the expanded market for B3 buyers. For any popular cut, there should be WAY more B3 buyers at $2 than there ever were B buyers at $12. First, the price point is more impulse-friendly to a wider marketplace which now includes little kids. Second, the price point appears to be a good value proposition: no filler. In fact, I would expect that buyers(B3)*$2 > buyers(B)*$12, by a long shot. Any earnings from the less-popular B6 cut would be gravy on top, if the label even decides to fully produce it all the way to market.
Re:damned Apple apologists (Score:3, Insightful)
Re:And that means (Score:2, Insightful)
I don't necessarily disagree with your belief that Apple likes DRM, but you miss one point. Any DRM security goes out the window as soon as it is opened up or licensed to others. If this happens to Apple, the record companies renege on their agreements, Apple has to make up a whole new DRM scheme, and Apple looses market share.
No, Apple is far better off not opening up their DRM, and it may be for more than one reason.
Re:one future of music distribution (Score:3, Insightful)
I think it's something else entirely.
The way in which we think about music is completely changing. The notions of albums, singles, B-sides and EPs are disappearing because music is no longer subject to any kind of time restriction or packaging system. An LP was what, 25 minutes a side? A cassette, 45 mins per side. A CD, 70 mins total. But that's over. An audio file can be any length. A musical composition can be any number of audio files in any order. It can be any length. And people can purchase any combination of them at a whim. Making a double or a triple album doesn't incur any kind of extra production cost.
The singles charts have been obsolete for a very long time and I think the album charts are going to go the same way. People need to start thinking sideways about all of this. Artists, labels and retailers all need to start taking advantage of the new creative possibilities.
Re:And that means (Score:4, Insightful)
If Apple licenced their DRM it would only have the affect of PROMOTING it. Look what's happening now - more and more tacks on iTMS are drm FREE, and will work with any music player you want.
Re:That's not good enough. (Score:2, Insightful)
They are selling barely 19% of the music. Get a grip, Jesus.
The RIAA hates Apple, that makes Apple my friend, for now. Amazon is okay, too; a great place to get album covers for my terabyte of high bitrate Usenet music stash.
Concentration of Evil? Shit, negro, have you looked around the big World lately, or, ever? You think some relatively small company that has been nearly marginalized, and finally has a couple of big successes is 'evil', what, by default? Shit, my daughter was right, the world's going to Hell because of stupid motherfuckers.
Insightful? More like delusional
Re:damned Apple apologists (Score:3, Insightful)
They didn't force Apple to do anything because I'm not aware of any other successful DRM-free ventures and Apple were already doing well with their DRM stuff at the time. It was never any benefit for Apple to have DRM -- they don't need to lock people in as they seem to have no trouble selling iPods based on their good points alone.
Do you honestly believe the labels would insist in selling with DRM if companies like Apple didn't give them a big profit?
I think the big record labels would insist on DRM no matter what until someone proves them wrong and drags them kicking and screaming into the 21st century, like Apple is help doing.