Real CEO Glaser: Steve Jobs’ comments on Real ‘not succeeding’ are ‘ridiculously humorous’

“RealNetworks is now involved in a war of words with rival digital music outlet Apple Computer Inc. Apple CEO Steve Jobs was quoted yesterday as saying RealNetworks’ business model, providing subscription services, is ‘not succeeding,'” ComputerWire reports.

“RealNetworks CEO Rob Glaser said Jobs’ comments were ‘ridiculously humorous’ and pointed to RealNetworks’ 55% growth in music revenue as evidence that the model works, according to the Reuters news service,” ComputerWire reports.

“Glaser recently proposed a strategic alliance with Apple in an email to Jobs, threatening an alternate alliance with Microsoft, which caused embarrassment when Apple publicly declined the offer by leaking the email to the New York Times,” ComputerWire reports.

Meanwhile, “RealNetworks Inc yesterday announced the resignation of its president and COO… Lawrence Jacobson, who worked at RealNetworks for three years, resigned, effective immediately ‘to pursue other opportunities and spend more time with his family,’ the company said in a statement,” ComputerWire reports. Full article here.

“RealNetworks said its music revenue increased by 55% while the company posted overall revenue of $60.4m in announcing its first quarter results,” Gareth Vorster reports for NetImperative. “The digital media service company said that it added 100,000 new music subscribers in the first quarter, now topping 450,000. Music revenue grew to $12.3m, from $7.9m in the fourth quarter of 2003, with its RealPlayer Music Store now offering more than 500,000 tracks,” Gareth Vorster reports for NetImperative. Full article here.

MacDailyNews Take: Real has a real winner here: 200,000 less tracks than Apple’s iTunes in a format that won’t play on the market-dominating players, Apple’s iPod and iPod mini. Now that’s really ridiculously humorous.

29 Comments

  1. MacDailyNews Take: Real has a real winner here: 200,000 less tracks than Apple’s iTunes in a format that won’t play on the market-dominating players, Apple’s iPod and iPod mini. Now that’s really ridiculously humorous. —

    Plus, their business is all subscription based. Now, that’s ridiculous and hilarious at the same time. These guys are “tubing” big time. Nice try, Glaser!

  2. lenny,
    that revenue includes subscription fees and license fees to buy the pro software. iTunes’ 2.7 mil is all paid downloads…. so REALs number point to much below 1 mil, I would guess something like 200,000 per week, if that.

  3. Even if the 12.3 million was all downloads, that’s just a lot of music that people don’t own. They quit paying or Real goes out of business, and <poof> the music is gone. I’m so jealous </sarcasm>

  4. “RealNetworks said its music revenue increased by 55% while the company posted overall revenue of $60.4m in announcing its first quarter results,”

    What is the point of having 60.4m rev if you still manage to lose 10.6m overall? I REALly like Real. If it wasn’t for them, we’d have one less sorry ass iTunes competitor to kick around.

  5. I did some calculations based on some assumptions of Real’s revenue. I assumed revenue from purchasing real player was not part of the 12.3mil from music. I also assumed 75% of their 450K subscriptions opted for the more expensive service while the remaining 25% selected the cheaper service. Based on the above assumptions (which could be totally wrong), I come up with the following:
    – Rhapsody subscription service ($10/mo) represented just over $10mil in revenue.
    – Radio Pass subscription service($5/mo) represented just over 1.6mil in revenue.
    – Downloads represented the remaining revenue, a measly $555K or just 702K downloads for the quarter (54K per week).

    If we change the subscription assumptions to 50/50 between the two choices the revenues are much different:
    – Rhapsody, $6.7mil
    – RadioPass, $3.35mil
    – Downloads, 2.25mil or 218K tracks per week.

    At most 83% of the subscriptions can be the more expensive service given the amount of revenue they report.

    Clearly they are bringing in a respectable level of revenue but the question remains if they can do it profitably.

  6. Well… I’m starting to lean towards wishing that Real makes a reasonable business — just enough profit to keep them running but not able to do anything else. Why?

    For a start, Gates needs a bug to swat to relieve his intellectual (cough) energy — better Real than Apple.

    Second, the schadenfreude of knowing that their thousands of subscribers are worrying if they will ever be able to unsubscribe, or of knowing that those poor buggers are actually using the services of one of the creepiest companies around.

    I don’t want to be denied a feeling of smugness once in a while. All I’ll have to do is to think about Real’s customers and I’ll get a strong hit that’ll satisfy my craving for months. After all, wouldn’t it be a weird world if everyone was smart or rational? I’m talking about humanity after all. “Long live diversity!” Every dog needs a bone — let’s throw Glaser one.

  7. The only thing far more “ridiculously humorous” is Real’s repot of wider net loss year-over-year!!!!!! Glaser is a crown, will M$ please abuse Real some more !!

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.