iTunes sales slumping
Bloomberg - along with just about everyone else - is off and running today with a just-released Forrester report that says that iTunes sales were off 65% in the first six months of 2006. "The decline is a reversal after almost two years of increases from April 2004 through January 2006," reports Bloomberg. "Between January and June of this year, iTunes transactions declined 58 percent, while transaction size fell 17 percent."
But surely if iTunes sales are off, the difference is being made up elsewhere, like in hardcopy sales. Nope. Instead, "there's simply been a general decrease across the board in the whole 'music buying scene,'" writes Darren Murph at Engadget. According to Murph, the only glimmer of hope comes from the previously un-chic world of streaming music services. Think Real Rhapsody. "Interestingly, analysts are theorizing that the DRM-era may actually be winding down in favor of 'blanket licensing,' which was cast aside just years ago in favor of the 'per purchase' approach."
OK, The Browser is stumped. We're not surprised to hear that iTunes sales are slowing. Once the thrill of instant gratification wore off, we went right back to buying CDs the old fashioned way. Why download an album when, for more or less the same price, you can get DRM-free songs plus a nifty CD with liner notes from Amazon? And sure, we've been having a blast today listening to Pandora, but that only prompts us to buy more new CDs. What are we missing? Speak up you Rhapsody lovers.
[Update Tuesday 6:27PM - Bloomberg has amended its story to include a response from Apple: "iTunes spokesman Tom Neumayr said the report is 'simply incorrect.'" OK, we're the first to be skeptical of Forrester, but usually we take issue when they wax overly optimistic. Moreover, it's hard to sympathize with Apple when it is unwilling to break out its iTunes revenues. We'll keep on an eye on it....]
The answer is fairly simple. With more and more consumers setting up wireless media systems in their homes they now have the ability to stream music 24-7 from their laptops or desktops through their home stereo systems. Having an unlimited supply of music available for a subscription service cost of $10 to $20 per month makes these services all the sudden seem like the way to go. Sure, you can't take the music with you on your Zune, Ipod, Dell DJ, IRiver, etc. but you spent the last 3-4 years buying all of those songs from MusicMatch, ITunes and the like.
The reports can say what they like, but here is my real story: My mother (89) has my first Nano and plays it through a player on top of her tv set. My black Nano is now half full. 500 tunes from CD's AND approx 500 tunes from Apple. I am 65 and will continue to shop for more tunes until I max out the Nano.
I am sure there are more of me out there!
I would much rather purchase the songs that I enjoy than sit through a stream of music that may suit my taste one minute and turn me off the next. That's what radio is for, and that's why I stopped listening to radio years ago. iTunes will always have a consumer base, despite sales jumps or drops.
While it may be true that some consumer purchases by ipod users decline or vary from year to year...it seems ludicrous to simply state that overall purchases are off by 58% by surveying such a small sample. Such overstated and inacurrate research smells like a competitor paid for the survey.
Just get "limewire"
Sometimes people try to over analyze these things. Perhaps the musicians just aren't producing work that we're looking for right now. I'm still listening to the same CD's that i bought 6 months ago.
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