Japan Today: Apple iPod+iTunes exposes ‘lame-ass efforts’ of Japanese competitors

“In what must be a low point for Sony and for the Japanese consumer electronics industry in general, Apple has announced that it now outsells Sony for music players, the first time that Sony has been outsold on home territory,” Terrie Lloyd writes for Japan Today. “According to Business Computer News (BCN), iPod sales now account for about 60% of the entire market of portable music player sales, including CD, tape, and MD players combined. The Apple domination became complete in July, with the launch of its iTunes music store, in competion with Sony’s Mora music download website. Apparently the availability of a huge number of titles, more than 1m tunes, coupled with lower prices, around 150 yen versus Mora’s 200 yen, have helped turn Japanese consumers on to the value proposition which is Apple.”

Lloyd writes, “Sony is trying to fight back, with new MP3 Walkmans priced close to the Apple models, such as 29,000 yen for a 6GB unit, and they’ve cut the pricing of Mora online songs by 15% recently. However, this is a lame-ass effort, given that the iPod is sexier, smaller, and cheaper, and since Mora only has a catalog of 200,000 tunes, users are flocking to the iTunes site instead. Even Sony’s own recording artists are complaining about Sony withholding its catalog from Apple Japan, and people like Motoharu Sano are signing up directly with Apple.”

Lloyd writes, “Not just Sony, but all the Japanese manufacturers have been caught flat-footed by the sudden explosion in music players and online entertainment. A quick look in the stores shows an overpriced Toshiba 40GB Gigabeat, a unit that is well designed and sounds OK, selling for 44,000 yen, while in the next showcase over, the much more capable 60GB iPod Photo is available for just a fraction more at 46,000 yen. We wonder if Toshiba actually sells any Gigabeats and why they think consumers wouldn’t buy an iPod instead. Have they lost their ability to market properly, even here at home in Japan?”

Full article here.

Terrie Lloyd is the founder of DaiJob, Inc. He also writes a weekly newsletter for entrepreneurs and business people about business and political opportunities in Japan. You can find the newsletter at http://www.terrie.com

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It’s too late. And the hardware device is only part of the story. Companies that are mismanaged to the point that they’re still hoping against hope about competing with Apple would need to be able to do software well, too. Sony can’t. You know, there’s a reason we didn’t bother registering WalkmanDailyNews.com.

Related articles:
Apple iPod & iTunes Music Store both number one in Japan; iPod market share nears 60-percent – November 16, 2005
SonyBMG antics may well cause public to turn on them and turn many people onto Apple Macs – November 06, 2005
Analyst: Sony BMG’s boycott of Apple’s iTunes Music Store Australia won’t last long – October 24, 2005
Apple launches iTunes Music Store Australia – October 24, 2005
Japan music labels look to impose ‘iPod Tax’ while Sony, Warner still not signing with Apple iTunes – October 10, 2005
Why aren’t Sony, BMG, Warner, Victor making their artists’ music available on Apple’s iTunes Japan? – October 06, 2005
Sony and Warner holding out on Apple iTunes Music Store Australia – September 08, 2005
Musicians stage mutiny against Sony, defiantly offer music via Apple’s iTunes Music Store – August 10, 2005
Record company causes Apple to hit ‘pause’ on Australian iTunes Music Store – May 05, 2005

24 Comments

  1. Apple’s insistance on the 99¢ pricing model is killing the competition. If Apple makes anything on iTMS, it is very small, and look at its volume. Anybody else trying to compete against the 99¢ model is doomed.

    Add to that the whole integration thing, and iPod/iTMS is unbeatable.

    Now for a word about one of my favorite subjects (NOT). There is absolutely no reason, none, nada, zilch, for Apple to license iTunes. Apple would get nothing for it, in comparison to the sales (nearly 100% market share) they already have.

  2. I agree with Gregg that it is the price point that is killing the competition. Steve Jobs said right at the very start when one of the first competitors showed up that he didn’t know how they would make any money on selling the Music because Apple sure wasn’t.

    The business model requires a few things to work. You need a simple to use, good looking, reliable and reasonably priced player that works with simple to use, good looking, reliable and free software for your computer and a simple to use, good looking, reliable and reasonably price online download store with a large selection of songs and all of these should be well integrated. So far, no one but Apple has been able to pull all of these elements together and until someone else can, no real competition will exist.

    As proof that you need all of these things for it to work, look at how Apple did not start to dominate in Japan until the Japanese ITMS came out.

  3. Equalizer, I’m not sure what your getting at? Anyway there is this situation called War. If you use google, that should tell you about it, well Japan instigated a act of war, which surprised many, yes Sony are as stupid as the American Navy was, to not see Apple coming, I’ll try and use smaller words, and also simplifiy content. I took it for granted you knew how to think Equalizer (well not you personally)

  4. Oh geeze … what next: the A-Bomb?

    When something is hot in Japan, it tends to sell phenomenally. In addition to shooting themselves in the foot by not placing their artists on iTMS shelves [how embarrassing], SONY has failed to take advantage of the iPod peripheral market.

    As the man on the spot, Jack A, can you tell us anything about iPod/iTMS visibility in the weekly rags there?

    Methinks Moto must be a bigtime Apple fan; maybe he reads MDN?

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