“It’s no secret that Apple rules the digital music world. But does the maker of the iPod and the popular iTunes music store finally have to start worrying about tougher competition down the road? Apple has a comfortable lead in the online music market but some analysts think potential competition from Microsoft, Amazon and Google could put a dent in sales at iTunes,” Paul R. La Monica writes for CNNMoney. “Could be. In the next few months, the cable network MTV is set to unveil its own music store, dubbed Urge, in partnership with Microsoft. And Amazon.com is said to be in talks with the major music labels about developing its own digital music shop.”
“And in what might be the biggest threat of all, Google may enter the online music market. Although the company has not said anything publicly about plans for a music store, Google did launch an online video store in January,” La Monica writes. “Following that news, Bear Stearns Internet analyst Robert Peck wrote a report predicting that Google would roll out a music store, which he dubbed Google Tunes, in the next few months. There has also been speculation that Google could buy its way in to the market through a purchase of iTunes rival Napster.”
“Analysts say that Apple, which announced last month that iTunes sold its billionth download since the store’s launch in April 2003, has a safe, comfortable lead in online music for now. But the company is far from infallible,” La Monica writes. “And one media analyst said that even though music companies may be growing wary of Apple’s market lead, they still should be thankful for Apple’s presence in the market since iTunes at least allows music companies to generate real revenue from online downloads. ‘iTunes has almost single-handedly salvaged the economics of the music companies by giving users a legal alternative to file-sharing and for that, I think, music companies are grateful,’ said Laura Martin, an analyst with Soleil — Media Metrics, an independent research firm. ‘But over time there may be more competition from services that shift the power back to content companies.’ So it may be a mistake to think that Apple’s share of the music market can keep expanding indefinitely.”
Full article here.
Maybe. Might. Speculation. Set to unveil. If. Promises. Predictions. More speculation. More maybes. The whole article is useless pablum. Give us a call when and if somebody has something concrete. Here’s one example of why La Monica’s article is pointless: Jason Hirschhorn, MTV Network’s chief digital officer, “We think the iPod has done a great job. Our aim is not to switch people from iTunes and the iPod.” (Associated Press, December 13, 2005). Here’s another: Google spokesperson, “no plans to acquire Napster, nor do we have plans to develop a music store at this time.” (MarketWatch, January 31, 2006). So, what’s the point of La Monica’s insipid article again?
Sure it’s a mistake to think that Apple’s share of the online music market can keep expanding indefinitely. They already have most of the market.
Advertisements:
• Apple’s brand new iPod Hi-Fi speaker system. Home stereo. Reinvented. Available now for $349 with free shipping.
• Apple’s new Mac mini. Intel Core, up to 4 times faster. Starting at just $599. Free shipping.
• MacBook Pro. The first Mac notebook built upon Intel Core Duo with iLife ’06, Front Row and built-in iSight. Starting at $1999. Free shipping.
• iMac. Twice as amazing — Intel Core Duo, iLife ’06, Front Row media experience, Apple Remote, built-in iSight. Starting at $1299. Free shipping.
• iPod Radio Remote. Listen to FM radio on your iPod and control everything with a convenient wired remote. Just $49.
• iPod. 15,000 songs. 25,000 photos. 150 hours of video. The new iPod. 30GB and 60GB models start at just $299. Free shipping.
• Connect iPod to your television set with the iPod AV Cable. Just $19.
Related articles:
Oppenheimer downgrades RealNetworks based on Microsoft’s ‘URGE’ partnership with MTV – December 15, 2005
MTV-Microsoft URGE music service not targeting iPod, iTunes users; Real CEO PlayedForSure? – December 13, 2005
Google: no interest in Napster, no plans to develop music store at this time – January 31, 2006
Napster does the math: layoffs commence with 10-percent of workforce lopped off – January 25, 2006
That last quote is a bit of laugh. Analysts always seem to be stuck with their heads firmly in the old box.
“Laura Martin, an analyst with Soleil — Media Metrics, an independent research firm. ‘But over time there may be more competition from services that shift the power back to content companies.'”
The power isn’t going to be shifted back to the ‘content companies’! iTunes and the other online music distribution services, and especially the new Web 2.0 services such as Pandora, are going to increasingly and acceleratingly place the power back where it should be, in the hands of the ARTISTS.
I love my ipod and enjoy downloading music and tv shows from the iTunes music store.
Boo!
One thing these analyst forgot is that none of those companies have a product like the ipod. And there services don’t work on a ipod.
And by the end of this X-mas, There will be a double in the ipods sold again. Say 32 million since x-mas 2005. Then say 60 million by X-mas 2006. Game over. Too many ipods. They will not give up the songs they bought from itunes, and convert to something else.
iTunes rival Napster . . . . . . . . . WTF!
URG?!
Like, I gotsta urg to take a dump.
“Cause it’s all a matter of the cocka-dookie and the stanky-stanky!”
Reminds me of the Blue Oyster Cult song, “Dominance and Submission.”
Radios appear ! ! !
“But does the maker of the iPod and the popular iTunes music store finally have to start worrying about tougher competition down the road?”
No, Apple needs to worry about things that might not be compatible with Mac OS X. They need to worry about the domination of other technologies that do not want to consider the Mac OS relevant.
I want an iPod patch. Get your music subcutaneously and maybe a vitamin boost as well.
It is time to license iTunes. The steady cash stream can be used to continue to “change the world.” Apple can continue to create the best players.
The industry needs a standard. I think it will create one, eventually, if they are not given access to the one which already exists, iTunes.
Betamax, VHS
Mac, Windows
now, iTunes and ?
In the first two cases the irrestible need for an industry standard won out in the mass market. I do not see how the current situation with digital music sales is different in this respect.
It will be easy to change Urge to Dirge when it fails.
Meanwhile Apple´s stock dropped over $2 today – down almost 4%.
Where´s that $100 the analysts and MDN were crowing about?
I think the $100 stock price is waiting for cash flow. The promise of really big cash flow. The kind Bill gets by simply copying the same code over and over to sell it again and again.
License iTunes!
Why do all “anal”yst always change their tone when the word “google” comes up. Google still hasn’t succeeded in anything besides a good search engine and running google ads. Of course their will be more competition eventually, duh.
The more competitors in iPod clones and online music stores actually strenghtens Apple’s hand.
It’s the same way Windows always seems to get stronger, despite how lousy it works.
Everybody wants to go with the majority.
The majority is iTunes and the iPod, and unless Apple makes some major mistakes or just fails to care anymore, they will always be numero uno.
These journalists with their “iPod Killer” banter are starting to sound like adults on Charlie Brown, “Wha wha wha wha wha wha…”
Whatever.
Yes Apple can stay number one. This will require it to continue to beat the heck out of the competition. It will be like running a race. Run harder, don’t stumble and stay ahead.
But, the likes of Microsoft, AOL, Google, Sony, etc. will not just quit trying. Eventually they will establish a presence in the market. The market is just to big for them not to break in. It would be like all television staying with RCA; content, sets, broadcast, the whole gamut.
Why not license iTunes and get a cut on everybody else’s (except Microsoft) head long, desperate move into the market? They are comming. We can still be Apple, make the best players and get a cut on the rest.
do you mean by “license iTunes”? Do you mean Fairplay DRM?
Someone will come up with a good store that effectively competes with iTMS. Someone will come up with a good player that effectively competes with the iPod. A key question is whether anyone will come up with both and match the integration of iPod/iTMS/iTunes (as player/organizer)…
So if this article contains nothing but empty speculation, which it does, why does MacDailyNews carry the story in the first place? Why would you want to participate in tabloid journalism?
Blah blah blah, yawn…..
licensing FairPlay would be a nightmare for Apple support and cutting the already thin margin slices even thinner ain’t gonna happen.
The wannabes should be focusing on creative new things to help consumers enjoy their entertainment rather than being so obsessed with what Apple is doing.
The whole NasDaq is down today and Appl road along, no worries, Apple products are selling well and when the results are in Apple will hit their guidance inspite of the Intel transition bumps and there’s green grass ahead.
Apple won’t stand a chance once Wall*Mart enters the market.
They did already?
Well, when Target enters the… they did?
Surely Apple can’t beat McDonald’s.
Yup, its all over when McDonald’s enters the market. The one-two punch of McDonald’s and McM$ will deliver the final blow to that upstart Apple.
You read it here first.
‘iTunes has almost single-handedly salvaged the economics of the music companies by giving users a legal alternative to file-sharing and for that, I think, music companies are grateful,’ said Laura Martin
Does she think about those music companies that want to get more money from Steve Jobs while he says higher prices will bring back music piracy???
Thank you for the comment what…
I quess I think of the on line store and the DRM as one thing. Of course it is many things and many people. I see the distinction you are making.
Three possibilites:
1. License the DRM and face competition from both players and music “stores”;
2. License the DRM with usibility only at the iTunes site; or
3. Keep the three together (player, DRM, store) and maintain a separate universe from the rest.
Right now we are doing very well keeping all three exclusively Apple. In the long run it will be Apple against everyone else. I predict this is so because I think everyone else will settle on a standard. There may be corporate blood along the way. If history is any lesson, they will arrive on a standard and Apple will be alone.
I think, in order to compete against Microsoft in this it will be necessary to have allies. We will need other corporations within the Apple camp.
I think to do this you have to let allied others build hardware certainly. Probably you have to let another store or two compete. Apple has the great head start. There is no reason the iTunes store should not remain the giant of the industry.
I say licence the DRM, take a cut from everybody who uses it and compete with the hardware and the on line store.
In this way Apple can continue to be the best at what it does and not, again, be left the odd man out at the big party.
These folks ignore the main reason Apple got into the MP3/music business in the first place — none of the existing MP3 players or music sources worked with the Mac. If all these great manufacturers hadn’t bowed down to the Gates of Hell, and had made Mac-compatible versions of their hardware/software, it’s possible the iPod or iTMS would not even exist…