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. Real has treated Apple users like second class citizens for years now. At NAB I just laughed at the Real Booth (so small you could have missed it) and Glaser was holed up in a tiny office in a tiny booth at this Hugely Important show. It said a lot.

  2. The company thinks leaving is good. they are only selfish and want more money because. Switching companys will not help there buisness. Microsoft could just buy the company.If thats what they want then Whatever
    U goes should send me 100$Or more.

  3. Ok, Dennis, name all of the hardware companies that made a profit last year. We are, for the most part, talking about profit here. Apart from Apple and Dell, can you name any? I’m not real knowledgeable, but there’s only one or two more at the most. Combine the download market and the computer manufacturing market and Apple is looking pretty good.

    Oh, wait, you’re talking about market share (but you’re afraid to mention it directly). Yes, Apple has a relatively small market share. Shame on Apple for producing computers that can be used effectively for more than three years. The installed user base (how many computers are actually sitting on people’s desks) is a better measure of use. Are you going to include all of the popular cash register models in this number? Most anal-ysts do, but its difficult to understand how or why a cash register is considered a personal computer.

  4. Sorry for the copy&paste;…

    It would be very interesting to find out what percentages of WinPCs:

    a) aren’t used for office work – where WinOffice is the only software installed
    b) aren’t used a cash registers, info kiosks, etc.
    c) aren’t used as a $1700 video game machine

    It would also be very interesting to find out what Windows people think can’t be done on a Mac.

    It would also be very interesting to find out why Windows people think the Mac should just go away.

    If apple does go out of business, will the price of Windows become cheaper for them? Will it become easier for them to ‘choose’ a ‘brand’ of computer if there’s one less to choose from?

    These are not, empty rhetorical questions. I’d really like to know.

    Actually, I really need to know.

    – – –

    And like before, I’m sure will go unanswered!

  5. MacBuddy, I would guess that there is a way to find out some of the answers you “need” but I have no idea what that would be. I find it hard to imagine the price of pc’s being affected if Macs disappeared, I don’t know that they view Apple as their primary competitor. Personally I think they view Apple as their primary R&D department. I think you’d be more likely to see pc’s slowly die out as they become unable to develop and push new technologies on their systems (e.g. Apple didn’t develop USB, but it didn’t take off until Apple put it on the iMac). Since brands will stagnate, the deciding factor on picking a pc will be price and price alone. As far as the first few questions, IT research sites would be the place to start IMO. Since I’m probably one of the least qualified to speak to the subject, though, other thoughts would be welcome.

  6. I don’t understand why Apple doesn’t offer a subscription service in addition to song purchases. If nearly half a million customers will pay Real for a subscription, why shouldn’t Apple want that business as well?

  7. for XABEX:

    simple – iPods! The worst thing about having a portable player is if the music stops working when you stop paying. So, subscriptions tend to be limited to those only interested in listening to music in one place – the desktop computer with ready internet connection. The iTMS is designed to sell iPods, NOT music. Encouraging the subscription service even slightly would take business away from the iPod. Once you go iPod, however, the solution is complete. That is Apple’s logic, and justification.

    Remember CD or book clubs? Those don’t work anymore even though people got actual CDs and books. The Real model is the same except without the material gratification of forever owning the objects. As well, how different is the Real model compared to listening to the radio – especially if you can only listen to music at fixed locations or under specific conditions? (You can’t take Real to go on vacation or share with friends, necessarily, especially if they don’t have internet access or even a computer!) Of course, choice is an issue, but to actually pay for it, and only for that one aspect? Even XM radio has been smart enough to offer portable solutions. I think XM radio is the only viable subscription model for longer terms. As well, recall that the iPod does more than play music. It stores notes, calendars, contacts, audiobooks, and all your files that you desire. Sure, other players might play music, but they don’t offer these bonuses, and they don’t have access to iTMS. The Jobsonian approach is the only way to insure the supremacy of iPod and iTMS. Arguments about market share, Apple’s history, etc. all miss the point because none of you perceive the not so subtle differences between music players and computers + software, or even the actual subtleties of the music industry.

  8. Ultimately, everyone here is ignoring one thing: the online music distribution model is not sufficiently profitable, if at all, in terms of required hardware, licensing, etc. Real’s model can’t work for long because you don’t make enough from just selling music. Apple’s model is sustainable because the hardware yields profits. I don’t think it’s a matter of people having trouble with Glaser, or Real claiming some sort of profit, or that there is sufficient space in the market for competitors. Rather, they are really arguing for the distinction between the hardware and software models.

    So, the question now is: why do people here repeat the same arguments over and over against Apple? It’s a general business model irrespective of the players involved. Apple just got it right this time. Anyone else could have, but they didn’t! What’s the big deal with all you detractors? And don’t get me started about The Inquirer’s accusations against the BBC – what a joke that was. (Oh no, to actually praise something that merits it? You’re so biased!) Would you have the same stubborness if the name was Microsoft, or even Real? Would something the size of Microsoft have been able to augment iTMS and iTunes so quickly as Apple has?

  9. RealNetworks has some kind of music service? Who knew?

    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.

    Ah yes, the old “spend more time with his family” excuse. More like rats fleeing a sinking ship.

  10. whao.. it’s not like Real is making a ton of money here.. let’s not forget…

    10,000 -> 20,000 is 100% growth…

    Glaser isn’t succeeding, and he’s probably jerking off to iTunes right now

  11. Haha rats fleeing a sinking ship. I don’t think Real is going anywhere. but I don’t think they will have any significant growth unless they change their buisness model. As some have mentioned above, some people like subscription based alternatives… I personally perfer to have rights to own the music I purchase…

  12. Real also wants WMA access now – I’m sure MS would trade that for the $1 Billion lawsuit … Real is dead. When Real folds up in 3 months, those that paid a hundred+ so far for music – all that just vaporizes.

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