“Steve Jobs has had much to celebrate lately. But the Apple CEO was particularly happy in February when he announced that the iTunes Music Store had sold its billionth song, to a teenager in Michigan who had bought a copy of Coldplay’s ‘Speed of Sound.’ That milestone is all the more impressive when you remember that Apple has numerous competitors in the digital music world. Yahoo Music Unlimited and the legal incarnation of Napster are gunning for iTunes customers. Sony and Samsung are trying to create iPod slayers,” Devin Leonard writes for Fortune. “And the field is only getting more crowded. By summer, Amazon may launch a digital music service with a branded MP3 player, possibly made by Samsung. It is already being referred to in the industry as the aPod. Amazon won’t discuss its plans, but sources tell FORTUNE that Amazon is targeting people over 40 years old–it refers to them as ‘the NPR crowd’ –who aren’t as likely to own iPods as MySpace users.”
“Yet Apple’s challengers all face the same problem: Jobs’ company will no doubt dominate the digital music market for years to come. That’s because Apple has learned its lesson about closed systems,” Leonard writes. “With the iPod, Jobs created a closed system with mass appeal. Fulcrum Global Partners estimates that iPods now account for 73% of the 30 million MP3 players currently in use in the U.S… Jobs cut a deal with the Big Five record companies in 2003 that locked up his device. The music companies wanted to sell songs on iTunes, but they were afraid of Internet piracy. So Jobs promised to wrap their songs in Apple’s FairPlay–the only copy-protection software that is iPod-compatible… That satisfied fearful music companies, but it means none of the songs sold by those services can be played on the wildly popular iPod. Instead, users of the services had to rely on inferior devices made by companies like Samsung and SanDisk that supported Microsoft’s Windows Media format.”
“The situation has been a disaster for Apple’s competitors. iTunes holds a commanding lead over its rivals, selling more than 75% of all digital songs, according to NPD. The second-place digital music store, eMusic [9%], can’t sell any major label hits because it refuses to copy protect them,” Leonard writes. “Poor Microsoft. Nearly every music service and MP3 player maker other than Apple supports Windows Media and its copy-protection software. But not enough music lovers want to use them. It’s a far cry from what happened in the desktop wars. It’s no fun when you’re outside of the closed system looking in.”
Full article here.
[Thanks to MacDailyNews Reader “Jim” for the heads up.]
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Related article:
Apple’s vs. Microsoft’s music DRM: whose solution supports more users? – August 17, 2005
Apple adding video has made it even harder for anyone else to break in. Even if you’re not interested in video today (2.5″ screen), the possibility that you might want it someday will push you to the iPod because you know the music you buy today will easily flow into it.
And the content at iTMS for video also becomes a factor, because there isn’t really anyone else doing it, and there’s no indication that anyone else will aggregate it like Apple. And the convenience of a one-stop shop for music, video, and podcasts also becomes a factor.
So the barriers to entry in the portable media player market just keeps rising with each passing week. The real threat will come from something completely different – maybe cell phones, but not unless one of the current cell carriers changes the paradigm.
Hey, $ . . .
“Poor Apple stock, dropping like a rock,” eh?
I know you’re just trolling, but here are the FACTS about your statement, dumbass.
One year ago APPL sold for $40 per share. Today its “falling” price is $65+, a growth of 60%. True, the stock is down from its high of $85 or so, but the downturn has occurred ONLY because demand for the new Mactels so far exceeds Apple’s ability to supply the units, that investors are bailing until next quarter. THEN let’s see how financially prescient you are.
One more thing, Troll. One year ago MSFT’s stock was selling at $25 per share; today, $27. WOW! Ain’t that fantastic?! A whole 8% growth for the biggest, baddest MooFoo on the block. You should be SO proud.
FYI: Don’t even BEGIN to look at the above figures on a 5-year basis for these two companies, OK? Your poor, addled brain couldn’t handle it!
Thanks, Gotrocks. I just checked the Five-Year line for Apple and Microshaft for “$” (who probably can’t do the math himself).
Apple’s stock over five years has INCREASED 500%, from $13 to $65!
Microshaft’s stock in the same five year period has DECLINED over 22% from $35 to $27!
Good grief! Where are you now, “$”?
>The new Origami devices will play Apple’s FairPlay (inside iTunes). It’s not an iPod privilege among the portables anymore.
Yeah, but where does that leave Donut boy and the prehistoric Gorog, Samsung and the rest?
Jeff,
You can rail against DRM all you want, but it is not going away. Your suggestion that record companies release music without DRM or allow Apple to drop Fairplay would completely undermine the legal download infrastructure that is slowly taking shape. Yes DRM can be a pain, and definitely limits what most of us would consider fair use. In my opinion however, the blame for this is shared by the millions who publicly share and download over WAN what they otherwise should purchase. There is plenty of blame to go around and the excess and greed of some in the recording business factors in. But that has always been a lame rationalization used by those who either don’t recognize or care that they are stealing and causing damage to a business that invests huge sums in a gamble that a hit record will provide a return on those investments. I know that many individuals honestly don’t know they are either breaking the law, nor do they have enough grasp of the economics to see corrosive nature of their actions on the mechanism that brings them the music they covet.
I do agree, however, that there needs to be a single flavor of DRM. One that allows fair use yet protects against mass duplication to protect content producers. I don’t see any indication that the industry players (entertainment or technology) are going to come to agreement on the DRM. The market, so far, has voted with its pocket book, and Apple’s Fairplay is their clear choice. Since you can still buy CDs with no DRM, it is clear from the Billion songs sold at ITMS that plenty of people think Fairplay provides decent fair use.
>The new Origami devices will play Apple’s FairPlay (inside iTunes). It’s not an iPod privilege among the portables anymore.
—
HUH!?> this thing is too big to be considered an ipod competitor! By your reasoning, there is no priveledge, since PC Laptops have been able to run iTunes for years.
It’s still too big. Obviously.
Oh yeah, and the iPod is pushing the ITMS, not the other way around. Remember the PEPSI contest? It was a joke. The next time, they pitched it with iPods.. it was a huge success.
Next.
I read somewhere, here maybe, that one of the Origami prototypes can only sustain 15 minutes of use before it runs out of juice. The larger prototype is a little better but it is huge! Much bigger than a Newton. I’ll see if I can find the article.
Tyk –
I am 47 and I own 4 iPods (two for me, two for my kids).
Origami is still vaporware. There’s not much market for devices that run for 15″ on their batteries. Newtons, those you can buy <i>today<i> on eBay.
Spark,
The fact that Apple allows you to burn your DRM’d music to a CD circumvents their own DRM. Therefore, the DRM is useless. It serves one purpose. Lock-in. If I’m already able to download music from iTunes and then burn it to a CD and reimport it as a MP3, then I am capable of setting it loose on the p2p sites. So, in essence, Apple’s DRM is doing nothing to prevent music piracy.
So why again, am I being treated like a criminal? If Apple didn’t give me the ability to burn CD’s of my purchased music, then I could see your reasoning that its to stop piracy.
The fact is, Apple pushes the DRM. Thats why the DRM is added only after you download the song. The DRM is in iTunes. The music on the store contains no DRM. And if you are a musician who wants to put your music on iTunes, you have no choice but to use Apple’s DRM. You cannot request your music to be DRM free. So much for the argument that the DRM is not Apple’s doing.
But Jeff, if I can remove the DRM and go to MP3 or unprotected AAC, then there is no lock-in.
I’m not supporting DRM. I agree with Spark that there are many causes for it. As it stands now, the DRM imposed by labels today simply deters people from casually allowing others to use it by making it more inconvenient. If anybody wants to, they can break it but you have to do it intentionally. Same for video on DVDs. From a legal standpoint, it’s the intention that counts. You can’t say I didn’t know since you had to take those extra steps to do it.
By the way, Jeff, I agree with you that the way out for the RIAA to end Apple’s dominance would be to lose the DRM on WMA, which could pressure Apple to give up Fairplay eventually.
But that may open up another can of worms…
That said, how come Apple gets away with this?
—
Cuz they’re the only company that understands software AND hardware.
Everyone else is trying to play the game by MS’s rules…
Well, I’m closer to 50 than 40 and I own an iPod. Funny thing is that I use it more for non-music purposes than I do for listening to my music collection. Being self employed AND working 7-days a week AND having an insatiable appetite for news/information, it is nearly impossible to listen to (when being broadcasted) everything I would like to. I know at a moment I can catch up on the Sunday morning talking-heads(ABC, NBC, CBS), NewsHour with Jim Lehrer, BBC Broadcasts, not to mention a plethora from PBS and… yes, NPR. Left-right and center, they’re all covered.
What strikes me about the NPR crowd, is they lean left, which is apparently what many Apple users do as well. The iPod is a natural thing for the NPR crowd. What is Amazon thinking?
Not sure how LEGAL this is. I guess it is by Russian standards:
allofmp3.com
Download an entire album with NO DRM for around a $1.25.
Click Here – DL.TV and click on the viewer questions segment. They disscuss it for a bit. Seems extremely SHADY, but they say there have been no reports of credit card fraud or anything from using this service. Now the LEGALITY of it is….well….you be the judge. Watch the viewer questions segment to get an overview.
I take no responsibility for anything that may happen to you if you use this service nor do I have any affiliation with it whatsoever. BEFORE GOING TO THE SITE, WATCH THE VIEWER QUESTIONS SEGMENTS ON THE DL.TV LINK ABOVE
The good part in the video link doesn’t start until around 5:00 minutes in…….
Amazing how many people can find a way to justify stealing music. Sure, DRM sucks, and I would like to get a better quality file for my dollar.
But that is the business model and it works. It satisfies all parties concerned (for the most part) and works economically. You do remember these people do this and expect to be reimbursed for it don’t you? Do you think they are doing it just for your enjoyment?
If you don’t like the business model than go and buy the CD. The record co. and the artist will thank you for it and you can then encode them however you like and use them as such. Your not being made to use iTunes or and iPod. You can still use both and get around the DRM in the ways mentioned. What it comes down to is that it inconveniences those who want it all without any restrictions. Those who more than likely download the songs off a fileshare anyway.
It’s just greed.
Dear MS,
How does it feel
How does it feel
To be on your own
With no direction home
Like a complete unknown
Like a rolling stone?
PS Yes Drunk Cheney,
I’m well over 50 (you probably guessed from the Dylan quote)
and I love my iPod 30GB in its black and tan, soft and sensuous, hand-made, spanish leather . . . .
. . . . . . sheath.
whoops! I meant Spanish.
I don’t own an iPod and probably never will (never say never, right?). Basically, I don’t have a use for one. They are cool, but I just don’t need one. When I listen to music it’s always on CD and through my home set-up. I don’t have any ripped music on my hard drive either. The only thing I do is make full or mix CDs from my originals to use in my car. Having a black car and living in a place where it is frequently 90+ in the summer time – there is no way I am taking out my originals to fry.
That’s all I want – to be able to make backups of my own purchased software and music CD’s and movie DVDs. Unfortunately, I probably won’t be able to do that anymore thanks to all the theives. It just causes harsher DRM and more legislation.
Some iPods I know of are owned by somebody aged : 62, 74 and 82 yrs., and they love it !
Where can I download TECHNO – TRANCE & HARD HOUSE
Can anyone point me to an online store where I can purchase techno – trance and hard house – for download?
Tyk – I’m over 40, have bought 4 iPods over the years since its launch (Two as gifts) and have many friends over 40 who also have iPods. I bought one of the original iPods when it was first launched (and its still going strong!) Amazons’ reasoning is, I think, quite insulting.
The only thing poor about Microsoft is their sense of style.