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Apple chief says company holding betting pool over new Yahoo service

post #1 of 45
Thread Starter 
Apple chief executive Steve Jobs has cast doubt on Yahoo's new $60-per-year music subscription service, proclaiming that Apple employees have started a betting pool to see when the internet search giant will raise its monthly rates.

Yahoo's $60 price-point is "substantially" below Yahoo's cost to run the service, Jobs said during his interview at Sunday evening's Wall Street Journal "D: All Things Digital" conference. He claims to have entered the pool himself, placing his money on "five months."

Jobs also attempted to dismiss the notion that cell phone service providers are likely to eat at Apple's dominate position in the digital music download market. He said downloading songs from the providers would likely offer "a lousy buying experience" at two or three times the cost of Apple's iTunes Music Store. "It's hard to see their customers as that stupid," he said.

Meanwhile, Jobs expressed his belief in the iPod "halo effect," noting stronger Mac growth over the company's last few quarters. Asked when Apple would reach a 10% market share, he said didn't know. "It's possible," he said. "...if people learn about our products, many of them choose them."

Commenting on security and viruses, Jobs said that since all computer makers face these challenges, it's not in his view to market machines that way. "One thing you never want to do in dealing with security and viruses is be cavalier," he said.

During his interview, Jobs also revealed that iTunes 4.9, a new version of Apple's digital music jukebox software, would add podcast support via a menu item. The menu will allow users to listen to podcasts and subscribe to them. Users of the new version, due out in the next 60 days, will also be able to categorize podcasts and sync them to their iPods, he said.

Additional notes from The Wall Street Journal "D: All Things Digital" conference are available in an earlier AppleInsider report.
post #2 of 45
My bet in the pool would be dependent on the date that Napster and/or Real's subscription service fails.

I believe Yahoo! will subsidize their money-losing service with the earnings from their profitable businesses to drive the competitors out of business. It's right out of the Microsoft playbook.
post #3 of 45
hopefully it'll force jobs to offer the same subscription type of service, regardless if its 60 bucks a year or 180 bucks a year, it will still be cheaper than present options
post #4 of 45
Quote:
Originally posted by macFanDave
I believe Yahoo! will subsidize their money-losing service with the earnings from their profitable businesses to drive the competitors out of business. It's right out of the Microsoft playbook.

That used to be illegal, I thought. Predatory practices, "dumping" and all that.
post #5 of 45
Quote:
Originally posted by Chris Cuilla
That used to be illegal, I thought. Predatory practices, "dumping" and all that.

With Republicans in charge? I don't think so.
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post #6 of 45
Quote:
Originally posted by Chris Cuilla
That used to be illegal, I thought. Predatory practices, "dumping" and all that.

"lower than cost" pricing is only predatory (n the legal sense & if I understand things correctly) when its done to force a competitor out of the market. So "loss leaders" are legal--as their purpose is to bring people into your store, not to destroy the DVD or bread shop around the corner (of course, that can have that effect). Given iTunes is the "big" guy in the market, one could argue that what ever they're losing is simply a "marketing cost" to gain entry into the marketplace. In any case, it can usually only be called "predatory" if the company doing the pricing has substantial power in that marketplace. Yahoo doesn't
post #7 of 45
Quote:
Originally posted by mcdawson
"lower than cost" pricing is only predatory (n the legal sense & if I understand things correctly) when its done to force a competitor out of the market. So "loss leaders" are legal--as their purpose is to bring people into your store, not to destroy the DVD or bread shop around the corner (of course, that can have that effect). Given iTunes is the "big" guy in the market, one could argue that what ever they're losing is simply a "marketing cost" to gain entry into the marketplace. In any case, it can usually only be called "predatory" if the company doing the pricing has substantial power in that marketplace. Yahoo doesn't

That's hard to say. It could be considered by the other subscription services that this is aimed at them rather than iTunes, which is a different model.

As Yahoo is doing rather well and has much deeper pockets than the other subscription services have, it could be considered predatory if Yahoo gains significant marketshare in that segment. Real, Napster, etc. could go to court over that issue rather than Apple which, if it's music download sales continue to increase, would see no reason to involve itself in that fray.
post #8 of 45
Quote:
Originally posted by mcdawson
"lower than cost" pricing is only predatory (n the legal sense & if I understand things correctly) when its done to force a competitor out of the market.

Right...and that was my point.
post #9 of 45
Quote:
Originally posted by Chris Cuilla
Right...and that was my point.

Just remember that "intent" can be very difficult to prove, or disprove.
post #10 of 45
I'm sure the betting pool comments is just FUD coming from our camp for once. You know Yahoo doesn't want to let Jobs win the betting pool, so now they'll have to prolong their deals. In turn, this will just piss off the music execs and shift some of the heat off Apple's back on to Yahoo's.

The biggest thing Yahoo has going for them is their massive subscriber base. I'm not gonna sign up for Napster or Rhapsody, but I already have a Yahoo account and can browse tunes with no additional signups or downloads. Not that I'll buy any music there or anything.
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post #11 of 45
Quote:
Originally posted by melgross
Just remember that "intent" can be very difficult to prove, or disprove.

No doubt. Didn't say it was an easy law to enforce...but a law nonetheless. Doesn't much matter...it won't even be attempted with the current DOJ anyway.
post #12 of 45
Quote:
Originally posted by Chris Cuilla
No doubt. Didn't say it was an easy law to enforce...but a law nonetheless. Doesn't much matter...it won't even be attempted with the current DOJ anyway.

It's up to the affected companies, or individuals to bring a complaint.
post #13 of 45
so how long do you lot reckon, i think steves being a little optimisitc, im saying more like 7 - 8 months
post #14 of 45
Quote:
Originally posted by stustanley
so how long do you lot reckon, i think steves being a little optimisitc, im saying more like 7 - 8 months

That's really a tough one.

If it's successful, would it be longer? Hoping to snare even more.

If it's not successful would it be longer? For the same reason.

Or the opposite?

I think whatever we say, it's just a guess. It could go either way.
post #15 of 45
Quote:
Originally posted by AppleInsider
Yahoo's $60 price-point is "substantially" below Yahoo's cost to run the service

You all know who owns Yahoo right? Give that Microsoft owns it, given that Microsoft can afford to go into any sector operating at a loss until it crushes the competition. Sound familiar? What in the world are those who supposedly protect the consumer from monopolist such as Microsoft doing?
post #16 of 45
Quote:
Originally posted by iPeon
You all know who owns Yahoo right? Give that Microsoft owns it, given that Microsoft can afford to go into any sector operating at a loss until it crushes the competition. Sound familiar? What in the world are those who supposedly protect the consumer from monopolist such as Microsoft doing?

What are you talking about?

Microsoft owns Yahoo? Where have you been living these past few years?

Yahoo is a competitor to MS. It was founded by two young guys in college, and their names are not Gates and Ballmer.

Go here and learn something:

http://yhoo.client.shareholder.com/
post #17 of 45
I could have sworn I read somewhere that Microsoft had purchased Yahoo a few years back.
post #18 of 45
Quote:
Originally posted by iPeon
I could have sworn I read somewhere that Microsoft had purchased Yahoo a few years back.

Not gonna happen.
post #19 of 45
This will not be a loss leading. The management at Yahoo are not dumb. They have a company that makes a lot of money and should not be taken lightly. They dont care about Real, Walmart or Napster. They are too small and will not have a impact on the market. They are destined to fail and either way will not be around it a couple of years. You have to look at it from Yahoos perceptive. They are a media company who sell advertisements and Internet ad are the fastest going market in the world, eg Goog $266 a share. Their music service is just another way to sell ads. No one argues that google should charge for their search engine, they make money from guys like me that write them a check every month to be listed in their service. (and I pay a lot) The Coca Colas, Pepsi, movie studios of this world will be throwing money at Yahoo to be in front of every 12-33 year olds sitting hours on end in front of Yahoos music service. How many hours do you sit on itunes? $6.00, they could do it for free and still make money. I am an apple fan and love itunes but Jobs needs to wake and smell the coffee. (I bet Starbuck will want to advertise on Yahoo's music service too)
post #20 of 45
Quote:
Originally posted by mactoys
This will not be a loss leading. The management at Yahoo are not dumb. They have a company that makes a lot of money and should not be taken lightly. They dont care about Real, Walmart or Napster. They are too small and will not have a impact on the market. They are destined to fail and either way will not be around it a couple of years. You have to look at it from Yahoos perceptive. They are a media company who sell advertisements and Internet ad are the fastest going market in the world, eg Goog $266 a share. Their music service is just another way to sell ads. No one argues that google should charge for their search engine, they make money from guys like me that write them a check every month to be listed in their service. (and I pay a lot) The Coca Colas, Pepsi, movie studios of this world will be throwing money at Yahoo to be in front of every 12-33 year olds sitting hours on end in front of Yahoos music service. How many hours do you sit on itunes? $6.00, they could do it for free and still make money. I am an apple fan and love itunes but Jobs needs to wake and smell the coffee. (I bet Starbuck will want to advertise on Yahoo's music service too)

I'm not so sure that a music service, even from Yahoo, can stay in service from ads. The expense from such a service is too high. I don't believe that they can attract anywhere near enough ads to keep this afloat.
post #21 of 45
5 1/2 months.

I wonder who won the bet...

CNN article
post #22 of 45
Quote:
Originally posted by kmok1
5 1/2 months.

I wonder who won the bet...

CNN article

I don't know, but it seemed inevitable.

It's stil a few bucks a month cheaper than the others.

http://www.forbes.com/feeds/ap/2005/...ap2302891.html
post #23 of 45
well according to the article, steve said 5 months, so he was pretty close!

stu
post #24 of 45
I don't see what's so ridiculous about paying $12/mth to access millions of songs.

The whole "renting" thing seems a lot less silly to me now than it did earlier. With DRM going where it's going, we're basically renting it until our hardware crashes.

What's really killing Yahoo's service is incompatability with the iPod.

I'm really starting to dislike Apple for keeping the iPod unnecessarily locked down so tight. They scream and cry when others play dirty pool, but the nano-second they get a market advantage they do the exact same thing.
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post #25 of 45
Quote:
Originally posted by groverat
I don't see what's so ridiculous about paying $12/mth to access millions of songs.

The whole "renting" thing seems a lot less silly to me now than it did earlier. With DRM going where it's going, we're basically renting it until our hardware crashes.

What's really killing Yahoo's service is incompatability with the iPod.

I'm really starting to dislike Apple for keeping the iPod unnecessarily locked down so tight. They scream and cry when others play dirty pool, but the nano-second they get a market advantage they do the exact same thing.

The one thing abour renting songs is this: it's under the assumption you want to continue to use that service. For example, if I buy two songs using Yahoo's service, it will always cost me a monthly fee for only those two songs. However, if I choose to purchase only two songs through iTunes, I'm billed once and that's it. The flipside is that I have access to an ulimited number of songs, but I am always paying for those songs. For myself, it seems easier to pay a small one time fee for two or three songs rather than having to pay yearly fees to retain the ability to listen to rented music.

Having said that, I still think buying used CDs and then mp3'ing them on my own is a far better solution than to be locked into DRMs from any company.
post #26 of 45
Quote:
Originally posted by Jim Paradise
Having said that, I still think buying used CDs and then mp3'ing them on my own is a far better solution than to be locked into DRMs from any company.

Exactly, especially when you consider that iTunes isn't really much cheaper. Better quality and no DRM.
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post #27 of 45
Quote:
Originally posted by groverat
Exactly, especially when you consider that iTunes isn't really much cheaper. Better quality and no DRM.

I think where iTMS appeals is primarily in the purchasing in singles. I still would buy albums on CD. But where getting a single song costs me a whole album...iTMS provides a decent solution for me.

EDIT: Looking over my Purchased Music playlist...I have not purchased more than 4 songs from the same artist/album. So, it would seem I am saving money (vs. buying albums...probably even used ones). I did make the impetuous decision to buy the U2 "How to Dismantle an Atomic Bomb" album on iTMS...and then got it on CD as a gift. Oops.
post #28 of 45
Well I hate the very idea of singles, so perhaps that's part of the problem.

Albums are (or at least should be) works of art as a whole.
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post #29 of 45
Oh, look. We are about to become a monopoly and we're so glad.
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post #30 of 45
Quote:
Originally posted by AquaMac
With Republicans in charge? I don't think so.

Yeah, blame the Republicans over Yahoo's service.
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post #31 of 45
Quote:
Originally posted by groverat
Well I hate the very idea of singles, so perhaps that's part of the problem.

Albums are (or at least should be) works of art as a whole.

Why? Aren't albums just a byproduct of technological evolution?
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post #32 of 45
Quote:
Originally posted by groverat
Well I hate the very idea of singles, so perhaps that's part of the problem.

Albums are (or at least should be) works of art as a whole.

Some are. Some aren't. Such is reality I guess.
post #33 of 45
I can see where the concept of the entire album is quite desirable in discerning the band's evolution over time. As the band grows and gets more experienced, their music may become more mature or shift from album to album.

That said, I think it's likely that MANY albums nowadays contain songs that aren't at all related to each other, though the "feel" of the whole album is very different from the one immediately prior to it.
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post #34 of 45
Quote:
Originally posted by CosmoNut
I can see where the concept of the entire album is quite desirable in discerning the band's evolution over time. As the band grows and gets more experienced, their music may become more mature or shift from album to album.

That said, I think it's likely that MANY albums nowadays contain songs that aren't at all related to each other, though the "feel" of the whole album is very different from the one immediately prior to it.

Most albums have always been like that.

Reletively few albums really should be listened through.

Even albums that tell a story through the whole album have a couple of very good songs, a few decent ones, and several very forgettable ones. I would rather miss the forgettable ones and most of the decent ones for the good ones.
post #35 of 45
Quote:
Originally posted by melgross
Most albums have always been like that.

Reletively few albums really should be listened through.

Even albums that tell a story through the whole album have a couple of very good songs, a few decent ones, and several very forgettable ones. I would rather miss the forgettable ones and most of the decent ones for the good ones.

yes, albums generally seem to be 2 or three good songs and the rest as filler to fill up the X amount of minutes left on the CD
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post #36 of 45
Quote:
Originally posted by mynamehere
yes, albums generally seem to be 2 or three good songs and the rest as filler to fill up the X amount of minutes left on the CD

I think that most artists think that everything they do is gold.

My cousins are song writers. They tell me that it's tough to get performers to reject anything that they themselves write, even if they (my cousins) are called in to try to fix problems.
post #37 of 45
Quote:
Originally posted by melgross
I think that most artists think that everything they do is gold.

On the other hand, shouldn't it be so? I though't artists created art, and produsers created revenue. Record labels don't want Madonnas and Michael Jacksons, who after one succesful disk actually start demanding their share of money, It's allways cheaper to labels to produce one hit wonders, and dump them afterwards. If the creative side was left for artist, even if they created some over artistic crap, it still would be something real, insted of this overproduced goo that saturates the music market now.
post #38 of 45
Quote:
Originally posted by Project2501
On the other hand, shouldn't it be so? I though't artists created art, and produsers created revenue. Record labels don't want Madonnas and Michael Jacksons, who after one succesful disk actually start demanding their share of money, It's allways cheaper to labels to produce one hit wonders, and dump them afterwards. If the creative side was left for artist, even if they created some over artistic crap, it still would be something real, insted of this overproduced goo that saturates the music market now.

Actually it's not. Record companies don't make much of any money at all with "one hit wonders". They make almost all their money from artists who produce year after year.

And most artists are failures, after all. They cost the companies plenty. The companies make money on the average. Well known artists want more of the profits. That's natural. But if they get it, then there won't be money for new acts.

I remember a few years ago on a TV disscussion show about writers and royalties that Stephen King was asked if it was true that he recieved $8,000,000 advance for a book. He said yes.

Someone else brought up the fact that there was a limited amount of money that a publisher could spend in total every year for these advances, and that every time a well known writer recieved huge advances it meant that new writers would recieve less, or none at all.

Of course, very successful writers, like musicians, bring home the bacon time after time. Those profits pay for everyone else.
post #39 of 45
Quote:
Originally posted by groverat
Well I hate the very idea of singles, so perhaps that's part of the problem.

Albums are (or at least should be) works of art as a whole.

How do you feel about albums that have only a couple of good songs on them, and the rest have a completely different tone, etc? Do you ignore those good songs because the album as a whole isn't that great? I agree that some albums can be really great, but there are some albums out there that don't hold much other than a song or two that are worth anything.

I'm not trying to patronize you, but I'm really interested in what you thing about this. I think the albums vs. singles discussion is more interesting than the original discussion. I like to have the CD if possible because the quality is so much better. Not only that, but you have a 'master copy' should you lose your entire mp3 collection. (though that would suck for a sufficiently large collection b/c the time invested in ripping all of the tracks).

Since you view the entire album as a work of art, do you prefer to keep your CDs in the original cases, etc? Does the idea of storing them in CD binders turn you off?
post #40 of 45
Quote:
Originally posted by pyr3
How do you feel about albums that have only a couple of good songs on them, and the rest have a completely different tone, etc? Do you ignore those good songs because the album as a whole isn't that great? I agree that some albums can be really great, but there are some albums out there that don't hold much other than a song or two that are worth anything.

I'm not trying to patronize you, but I'm really interested in what you thing about this. I think the albums vs. singles discussion is more interesting than the original discussion. I like to have the CD if possible because the quality is so much better. Not only that, but you have a 'master copy' should you lose your entire mp3 collection. (though that would suck for a sufficiently large collection b/c the time invested in ripping all of the tracks).

Since you view the entire album as a work of art, do you prefer to keep your CDs in the original cases, etc? Does the idea of storing them in CD binders turn you off?

This is one viewpoint that will never be resolved. It's just a personal matter of taste. Some of us will only buy complete albums, and some of us will swing back and forth.
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