Apple’s iTunes loses market share in battle for video viewers

“Apple Inc.’s iTunes Store — already struggling against rising competition for music listeners — is losing the battle for video viewers as well,” Ben Fritz and Tripp Mickle report for The Wall Street Journal. “The company’s market share for renting and selling movies has been falling for several years, tumbling to between 20% and 35% from well over 50% as recently as 2012, according to people with knowledge of the matter.”

“No third parties track market share in the digital-movie business, making exact figures impossible to obtain. Different Hollywood studios do different amounts of business with Apple, but several of them report a marked decline in iTunes’ leadership position,” Fritz and Mickle report. “An Apple spokeswoman, who didn’t dispute the market-share estimates, said Apple is focused on providing customers with video content across subscription services such as Netflix and HBO, as well as iTunes, where she said movie purchases and rentals have increased over the past year and hit their highest level in more than a decade.”

“Apple’s iTunes has faced a host of rising competitors in recent years in the market for renting and buying new movies online,” Fritz and Mickle report. “One that has had a big impact is Amazon.com Inc., which in addition to its Prime subscription service rents and sells movies on a “transactional” basis. Its market share in that business has recently risen to around 20%, studio executives who are involved in home-entertainment sales say, as it has been highlighting its entertainment offerings. Another is Comcast Corp., the nation’s largest cable provider by subscribers, which has long rented movies on its set-top boxes and in late 2013 began selling digital copies as well. It now has about 15% of the combined market, according to people involved in digital movie sales.”

Read more in the full article here.

Eddy Cue
Eddy Cue
MacDailyNews Take: Despite the fact that Apple’s iTunes isn’t run by the brightest Apple VP who ever graced the face of the earth (Eddy Cue), digital movie rentals are a commodity. As long as Apple has the same titles are the other outlets at around the same prices, market share is meaningless. The movie rental/sales service is there to sell and feed devices, not to make massive profits in a market full of similar offerings. Share erosion is normal when you’ve pioneered a market and then a bunch of followers enter with similar offerings.

Beyond blockbuster exclusives, if Apple were to develop quality original content that could build and keep an audience (no, Eddy, Planet of the Apps isn’t it, duh) and place it in proper proximity to movie sales and rentals (no, Eddy, not in Apple Music, duh), they’d have a better shot at retaining share.

SEE ALSO:
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Apple premieres first original series, ‘Planet of the Apps,’ at WWDC – June 7, 2017
Apple’s new TV show ‘Planet of the Apps’ searches for next breakout app – March 10, 2017
Why Apple’s ‘Planet of the Apps’ totally misses the point of original programming – February 21, 2017
Apple dips toe into original content production but plans to get more aggressive – February 14, 2017
Eddy Cue: ‘Planet of the Apps’ is another way to sell more Apple Music subscriptions – February 14, 2017
Apple debuts ‘Planet of the Apps’ trailer for new Apple Music series – February 14, 2017
Jessica Alba joins Apple’s ‘Planet of the Apps’ reality series – August 30, 2016
Gwyneth Paltrow, Gary Vaynerchuk and will.i.am Join ‘Planet Of The Apps’ as mentors – August 4, 2016
Open Thread: Will you watch ‘Planet of the Apps?” – July 15, 2016
Apple calls for developers to star in reality show ‘Planet of the Apps’ – July 13, 2016
Dr. Dre to star in Apple’s first, sex-soaked scripted television series ‘Vital Signs’ – February 12, 2016
Apple looking to develop original TV series as part of new video strategy, sources say – January 29, 2016
Why Apple might feel compelled to get into original content – September 2, 2015
Just because Apple may be getting into original content doesn’t mean it can produce good shows – September 1, 2015
Apple made ‘audacious bid’ for Top Gear trio of Clarkson, Hammond and May, but lost out to Bezos’ Amazon – September 1, 2015
Apple’s move into content creation could devastate Netflix and Amazon
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Why would Apple want to make their own movies and TV shows? – September 1, 2015
Apple exploring entry into original entertainment production – August 31, 2015

16 Comments

  1. Agree with MDN. Apple needs to break up iTunes and give the different services their own apps/experiences to shine.

    Selling videos in iTunes tells the story

  2. I switched from iTunes to Plex 8 months ago and will never return to iTunes . Plex is a superior streamer with more user functions and movie information available. Plex also offers binge watching with TV shows, something iTunes doesen’t and the fact iTunes doesn’t support my library movies, only their purchased movies. Keep up the good work Eddie “clueless” Cue.

    1. As much as I love Plex… I have a 64TB Plex server running on a Mac mini, comparing it to iTunes the way you did is a bit of a false comparison.

      There are some things Plex doesn’t do well at all compared to iTunes… try to manually batch edit metadata, or allowing Plex to manage file naming and path structure. Try buying or renting a movie from Plex. I could go on and on in regards to UI, UE, and different feature sets.

      iTunes allows binge watching. Put your video in a playlist. iTunes supports movies not purchased through them, just make sure they’re in a compatible file format, like MP4/H.264 (and soon HEVC).

      Like I said, I love Plex. It’s life changing and I recommend it to anyone, especially if you have a spare Mac, but it’s greatness doesn’t diminish my use of iTunes… which happens to be my biggest source of purchasing movies for my Plex library… (over 3,600).

      1. Yes you did mention some things iTunes does extra, but you have to go and do extra steps to make it happen. No extra steps in Plex. As for meta data iTunes purchased shows all have it. I add my own meta data to my rips. ITunes doesn’t do any non-purchased meta data lookup. You can only change the meta data. Most of all iTunes does not easily support non purchased shows without jumping through some hoops. As for iTunes home sharing, well it needs work. I’m constantly having to re- enter my Apple ID on AppleTV 4th gen. I have been an Mac useder sence the 80’s and iTunes need some serious work. Plex also enables you to share your library over the Internet for yourself, friends and family. While I don’t have as my movies as you, only 2513, I have a substantial TV show library, 162 different shows, some with 10 or more seasons. Plex also now has released a dvr service which works quit well.

        1. You’re still glossing over what Plex doesn’t do at all or does that’s vastly inferior to iTunes. Import a bunch of music into Plex and try batch editing the metadata. Try using any number of AppleScripts to batch edit metadata. Try creating smart playlists. Try having Plex name and organize your files. Again, I could go on all day…

          Most of all iTunes does not easily support non purchased shows without jumping through some hoops.

          Not really, it just needs to be in a compatible format. The default format, although others are available is MP4/H.264. Guess what though… if your file isn’t in a native macOS compatible format with Plex, it needs to be transcoded or remuxed as well.

          In an era where so many people are complaining about iTunes being bloated, it’s funny that you’re complaining that iTunes doesn’t have metadata lookup or additional transcoding and remuxing engines, or isn’t a full server.

          Plex also enables you to share your library over the Internet for yourself…DVR

          Yes, I know. In addition to my library I also use the DVR. However, Plex is a very different application than iTunes. My whole point is that Plex is neither better nor worse than iTunes, it’s different. There are some things you can do in one and not the other and some things that are handled much better in one versus the other due to them having vastly different objectives even if at the core, they’re both DAMs.

    2. Pretty much everything is better than iTunes for streaming video content.

      I’m an Apple fan, and I have the latest AppleTV. But I use my FireTV for streaming.

    3. Yes, Plex is limited in certain ways on its own. It’s come a long way from the early days, but I still think of it as a frontend. Another point to be made here, and I’m not picking on any individual, just speaking generally, is that ever since mobile devices have become the norm, it seems a lot of people will deem something inadequate simply because they don’t know how it works or are unaware that it contains certain functionality in the first place! That said, Plex is awesome, just not all it can be on its own.

  3. Though I see MDN’s point that “As long as Apple has the same titles as the other outlets at around the same prices, market share is meaningless.”, I would think since you each vendor ‘selling’ titles has access limited to sourcing (streaming/download) from ‘their’ servers, market share becomes important as a means to insure the consumer is protected from ‘losing’ that content when a company decides their video ‘sales’ is no longer profitable and frees up those servers.

  4. Despite movie and TV studios efforts to keep digital rental and purchase prices sky high, one would expect all this competition would drive down prices somewhat — but that’s not the case, as we all know.

    Frankly, the other providers’ charges are an insult to consumers — but iTunes prices are an absolute rip-off.

    No wonder customers are drifting off to deals on Amazon Prime, NetFlix, et al. Who can blame them?

  5. A couple points:

    • All cable and satellite services offer ‘On Demand’ video watching and have done so for decades. You pay and have a window of time for watching. Many videos are entirely free.

    • It’s a game of Wack-A-Mole trying to stop the various methods of obtaining and/or watching/listening to/reading ripped copies of just about anything on the Internet. That’s also decades old.

    [I’ll throw in my usual comment that if only media companies treated their customers with respect, the freetard/ripoff market would be considerably smaller. I consider most media companies to be infected with the usual ‘Short-Term Thinking, Long-Term Disaster’ bad attitude of the 20th century. Oops. Wrong century, dummies. Let the new generation take over and do it right. If you’ve read the abominable TPP and TTIP trade treaties, you’d know exactly what I mean. That’s one reason I’m pleased they’re d e a d. There’s at least one reason to thank The Trump.]

  6. Gave up itunes years ago. My firetv running kodi for my 5TB and 2TB networked drives of movies makes it way to play. And pulls metadata for me. Plex is nice too just don’t like the fees.

  7. Apple has done nothing to help a Mac user better manage a collection of home movies. Why would one expect Apple to offer simple intuitive cost effective movie rental or purchase? Timmy’s company is betting its future on ios App Store, Siri and iCloud, the latter two of which are failures in my experience. But that is where all efforts have been since Cook arrived. iPod, Mac, Airport, and iTunes improvements all screeched to a shocking halt. Apple TV is a disappointment too. Enjoying Roku and 4K BluRay instead.

  8. Correction MDN… per Apples site… iTunes is run by Mr Eddy Convolution Master Cue.

    https://www.apple.com/leadership/eddy-cue/

    And i have always brought the example of the convoluted iTunes as an example of his work when criticizing His Apple Music efforts and how idiotic it is to promotoe movies and shows in a music app/subscription service …plus medicore UI ….
    As if itunes was is not and has not bee a great learning lesson for Apple..

    Why the hell is Eddy still there… Tim ? Are you paying attention to the quality of his work and performance? Or is he an out of control independent entity at Apple?
    Chain is as strong as its weakest link !

    1. I think MDN meant to express that it IS run by Cue and that Cue is not the brightest.

      They were NOT suggesting Cue was the brightest, and that iTunes was not run by him.

      The clause needs rewriting.

      –The Editor

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