“Seattle-based RealNetworks, which is one of several companies trying to win consumers over to a music-subscription service that competes with Apple Computer’s iTunes store, says it has doubled the number of paying customers in the past year,” Peter Kafka reports for Forbes. “Real said Tuesday that it had 1.4 million subscribers for its music services at the end of 2005, up from 700,000 a year before. The company said it had earned $312 million in 2005 on sales of $325 million. [Note: Real’s year-end results include a $478 million payment from Microsoft as part of an anti-trust case settlement… Real expects to receive another $283 million from Microsoft during the next five quarters.]
“Real makes most of its money selling consumers access to entertainment like music and games via subscription services, in which customers pay a monthly fee to ‘rent’ their entertainment,” Kafka reports. “…To date, Internet music subscription offerings like those from Real, Napster and Yahoo! have yet to take off – there are perhaps 3 million subscribers to Internet music services… Dan Sheerhan, Real’s senior vice president of consumer services, said the main hurdle facing subscription services is that the devices don’t work with Apple’s successful iPod line of music players, and that competitors haven’t come up with a device that works as well with Real’s offering as the iPod does with iTunes. That should change in 2006, he said, as Real works with manufacturers including Samsung, Toshiba and SanDisk to offer a competitive product. ‘We’re simply in a phase of the market’s development that we knew was going to come but we thought would be shorter than it has been,’ he said.”
Full article here.
Small potatoes — or, in this case, doughnuts. The also-rans’ annual mantra: “We haven’t come up with a device that works as well as the iPod does with iTunes. That should change in 2004, 2005, 2006…”
From RealNetworks’ press release: “For the fourth quarter, in the Consumer Products and Services segment, Music revenue was $26.1 million, a 29% increase over the fourth quarter of 2004; Games revenue was $15.7 million, a 52% increase over the fourth quarter of 2004; Video, Consumer Software and Other revenue was $22.6 million, a decrease of 10% over the fourth quarter of 2004; and Media Properties revenue was $9.0 million, a 55% increase over the fourth quarter of 2004. In the Business Products and Services segment, revenue was $10.2 million in the fourth quarter, a decrease of 8% over the same period in 2004… In 2005, revenue grew 22% to $325.1 million compared to $266.7 million in 2004. In the Consumer Products and Services segment, Music revenue was $97.5 million, a 50% increase over 2004; Games revenue was $56.3 million, a 63% increase over 2004; Video, Consumer Software and Other revenue was $95.0 million, a 2% decrease over 2004; and Media Properties revenue was $31.1 million, a 43% increase over 2004. In the Business Products and Services segment, revenue was $45.1 million, a 7% decrease from 2004.”
Real is like digital foot fungus; nobody wants it, it’s quite irritating, and, unfortunately, it just never seems to go away completely.
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Competition? What competition? Is an ant fighting against an elephant really competition? Oh wait, sorry, Real’s customers doubled, so… Is TWO ants fighting against an elephant really competition? Can anyone show at any point where Apple did anything with the iPod to CATCH UP to the “competition”? Has Apple added an FM tuner to it’s players?
The competition only exists between the also ran WMF based vendors out there including Real, Wal-Mart, etc… NOT against Apple.
The only competition the iPod has is with itself. Each level of iPod competes against the next one. ITMS barely makes money, and it is a mechanism to sell iPods. Many so called “competitors” have been crushed between the hammer of ITMS and the anvil of iPod.
Somehow, I don’t think those music “renters” are merely renting their music. I think that many of those “renters” are using a program that allows them to record whatever is playing through their computers, recording their favorite tunes, and then later loading it into their iPods. My prediction is that their user base of customers is NOT sustainable. They will come and go as they record the music they need, and then move one.
Somehow, I don’t think those music “renters” are merely renting their music
—
I wonder if subscription customers feel guilty when they hear their favorite song on the radio…
“who do i pay for that…?” they pull out their wallets, totally perplexed
I also think the customer ‘churn’ rate will be terribly high. It really is not likely to succeed, but good luck to ’em for trying.
When describing these iTMS competitors as ‘The also-rans’ I feel a bit uncomfortable as this is exactly the reverse of the position with the Mac.
More honourable would be to show them some respect, at least that’s what I say.
glaser, as in glazed donuts. interesting.
Rob should use what money he has left to buy all the copies of that picture of him and have them destroyed.
I will give a company respect if they DESERVE respect. M$ doesn’t deserve respect because it used it’s monopoly to gain unfair advantage in the market. Real doesn’t deserve respect because it used “hacker-like” methods to get their music to play on an iPod. Time will only tell if online renting should be given respect if it can compete FAIRLY against whoever. I doubt that will happen, but we will see.
“Real is like digital foot fungus; nobody wants it, it’s quite irritating, and, unfortunately, it just never seems to go away completely.”
Kinda like Apple’s Macintrash computers.
“Unfair” monopolies are what every company strives for–never forget that.
That’s what iTunes/iPod is but we just like that so it’s ok.
FUseek you
At first glance that picture looks like what an older Jim Belushi would have looked like after discovering carbohydrates.
Yikes!!
“Macintrash”
Clever! Did you make that all by yourself or in a tight circle of your closest friends?
“Unfair” monopolies are what every company strives for–never forget that”
Oh gosh, here’s another mindless anti-corporate liberal whining about how corporations are evil and are seeking to monopolize an industry and take the money from the working class. If you would care to patch up your bleeding heart just for a moment, just long enough to utilize the two remaining brain cells you have left, you would realize the a monopoly is a RESULT of unfair practices, which is why the federal government acts to break them up.
Saying that ITMS/iPods is a monopoly is like saying McDonald’s has a monopoly on Big Macs. Did you know that there are other burgers out there besides Big Macs? Oh Yeah! Burger King has one called the Whopper. Carl’s Junior has one called the Famous Star. MORE BIG NEWS! There are other players and providers besides ITMS/iPOD! NO, SERIOUSLY!
Don’t moan and bitch about the coolness factor and popularity of the iPod. Just cause it’s got something YOU’VE never had, namely coolness and popularity, doesn’t mean that it’s got a monopoly.
Again, a monopoly is not illegal.
Apple could have 100% of the online music and portable player markets and it would be legal.
To abuse a monopoly to harm your competitors is what’s illegal. Ask Microsoft about that and how much it cost them behind-the-scenes to get a slap on the wrist when they should’ve been broken apart.
“SQWAAAAK! Competition is good! Competition is good! SQWAAAAK!”
I am a Mac user. I do not see a Windows-only service as “competition”. I see it as a threat. And yes, I take joy every time I see less-than-stellar financial results from Real or Napster. The sooner these Mac-marginalizing b45tards go out of business, the better. I do not want to have to switch to a POS Windows machine to download my music.
But keep repeating the mantra: “See, competition is good, mmm-kay?”
Every company’s goal is a monopoly–that’s not evil.
The point is if Apple was a you freakin’ Mac whiners would be glad and let Apple rape you continuously. But, if Microshaft does anything–anything mind you you cry fowl.
You people make me sick!
Now go Mac-off to pictures of Steve Jobs.
“”Unfair” monopolies are what every company strives for–never forget that.
Every company’s goal is a monopoly–that’s not evil.”
You contradicted yourself, and you are too stupid to even realize it. Being “unfair” is wrong, and therefore it IS evil.
“The point is if Apple was a you freakin’ Mac whiners would be glad and let Apple rape you continuously.”
Man, that wasn’t even comprehensible. Hey, think BEFORE you type, not AS you type. But, I guess that is what one would expect from a M$ tool as yourself.
Let me tell you what you meant to type, as you are too dull to realize, “The point is if Apple was a MONOPOLY you freakin’ Mac whiners would be glad and let Apple rape you continuously.”
You contradicted yourself AGAIN! Earlier, you said:
“That’s what iTunes/iPod is [a monopoly] but we just like that so it’s ok.”
Is Apple a monopoly or isn’t it? My up you mind that you don’t have, will you!
BTW, why do you spend ANY time in a Mac forum? Why do you care so much about what us “Mac whiners” say? I’ll tell you why. Deep in the reeceses of your little mind, you wish XP were as good as OSX, and that your dull little windows box were as cool as Macs are. Once again, you want something you’ve NEVER had, and you lash out at those who have it.
Someone miss their meds?
Even if someone does come up with something that works as well as the iPod, I still don’t think it will take off. The iPod is what people want.