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Are Apple's iTunes music sales plummeting? - Page 2

post #41 of 121
The quality difference between 128kB AAC and a CD might not be clear with the apple iBuds, but even my cheap little Altec Lansing portable stereo or factory car stereo shows the difference. It sounds flat.

And for the record, I am far from an audiophile; I'm about as tone deaf as they come.

CDs just offer a better value proposition if you aren't in the "Must Have it Now" category.

It's time for Apple to ditch the DRM and bump up quality. They will still have plenty of sales without it, but if they really want to set the trends and kill products like Zune out the gates, it is time.
post #42 of 121
What actually is surprising is that people pay for music distributed in crippled formats. Of the DRM schemes that I've seen, Apple's is probably the least intrusive. However, the lossy compression of the music is significant. Considering that video is moving to high definition, it is surprising that people would want lower definition in their music. When the price of an album is factored in, it makes no sense in terms of cost to buy the Apple compressed version rather than the CD uncompressed version.

While I suppose that the earphones supplied with the Ipods have insufficient fidelity to make obvious the deficiencies in the program material, those deficiencies are glaringly obvious on a decent home stereo system. I returned the player I bought after connecting it to the audio system in my Navigator and my wife’s Vanden Plas. The distortion in the sound from the lossy compression was obvious, even on a car stereo system.

Even CD quality is, at best, only mid-fi. Remember that CD was a compromise built with what was the best technology available at the time. They were invented in the late 1970s and the first players and CDs began appearing around 1982-83. The first decent sounding CD player that I heard was a $2,500 Macintosh that appeared some time around 1985. 16 bit 44.1 kHz sampling was a big technical challenge years ago. Those specs were determined sufficient to reproduce sound for the average person’s hearing. But 44.1 kHz sampling is not enough sampling to smoothly and accurately reproduce the waveforms of high frequencies; thus resulting in brittle sound. The 90 dB dynamic range of CD is adequate, but not generous. Symphony orchestras typically have a dynamic range of 70+ dB from pianissimo to forte. Live Jazz is nearly as demanding, and in some cases, as demanding as orchestral music.

New standards, such as Dolby True HD fix the limitations of CD audio with up to 8 tracks of 24 bit/96 kHz audio. Instead of moving to low fidelity, music should be moving to true high fidelity. An Ipod and compressed audio is ok for something to carry around. They are fine for non-critical listening, but when one is actively listening to music lowered fidelity does not make sense. Since one can compress a good quality source, why would anyone buy the same music twice? Why purchase once in a higher quality format and once again in a lower quality format when it’s trivial to create compressed versions?
post #43 of 121
Quote:
Originally Posted by JeffDM

P2P is not a product and is not a legal business. Where the RIAA may be about highway robbery, P2P is basically just theiving in the other direction.

I don't think the point of iTunes is the albums, but allowing you to cherry-pick the song you want rather than having to buy the album.

I hope you don’t think that I’m implying P2P/file sharing is legal – but iTunes is in competition with them. The best way to overcome any competitor, such as physical CD’s and file sharing services, is to exceed in what they offer; beginning with lossless files (not this ‘near CD’ stuff) and an easy way to retrieve it in case its lost, like you could from a physical CD if your drive were to fial or your home made CD's became unreadable .
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post #44 of 121
Of course, all of this is a lot of fuss without verification. I'm sure Apple has evidence that counters this suspicious "analysis".

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post #45 of 121
I'm part of those declining sales. 128kbps just doesn't sound good enough. I thought I couldn't tell the difference at first, but on the nice speakers in the car I can really tell the difference. I'm also finding the CD's I want on eBay and Half-Price Books for a fraction of the price.
post #46 of 121
Ok, why don't we actually talk about the news itself??

First, the data analyzed were credit card records, which doesn't give a pure picture of the situation, but only a decent estimate.

Second, why has noone realized that Apple has hit its saturation point for iTunes. As the whole iPod+iTunes fad ramped up, tons of people flocked to iTunes as a way to purchase new songs/albums/etc along with those old singles they always liked but never owned. Now, with most people owning at least one iPod, the new user base has shrank dramatically. Apple is no longer getting the steady stream of newbies who are looking to fill up their iPods with musci from iTunes. The majority of iTunes users are now people who like the service and are buying new songs as they like, which generally means small, sporadic purchases.

The importance of this news is that it signals a new period for iTunes that investors should closely watch, has Apple built up a dedicated userbase to keep iTune profitable for the long haul.
post #47 of 121
Ever since the iTunes store garbaged its site up with all of the video stuff, I haven't bought a track. I did sign up for eMusic though...
post #48 of 121
On the whole, I think iTunes could grow by merging services with Netflix (to include movie rentals with the downloads).

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post #49 of 121
The interpretation of the Forrester data is flat wrong. Tunes per iPod sold are actually increasing.

Do the Math: iTunes sales aren't collapsing

Wouldn't it be nice if AI weren't just a part of the stupid echo chamber and actually added a thought about a story? When I first saw the NYT article, I knew something was wrong. If you look at the number of iPods sold per month or quarter vs. the number of tunes sold in the same time period, you can easily see that the number of tunes per iPod is actually increasing.
post #50 of 121
Quote:
Originally Posted by Rolo

The interpretation of the Forrester data is flat wrong. Tunes per iPod sold are actually increasing.

Do the Math: iTunes sales aren't collapsing

Wouldn't it be nice if AI weren't just a part of the stupid echo chamber and actually added a thought about a story? When I first saw the NYT article, I knew something was wrong. If you look at the number of iPods sold per month or quarter vs. the number of tunes sold in the same time period, you can easily see that the number of tunes per iPod is actually increasing.

Good link. Now just get Forrester to back up their claim.

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post #51 of 121
Good call Rolo. The conclusions sounded 'hyped'.

The important thing about iTunes is the infrastructure that they are building. Apple could service any model of DRM/encoding/payment that the world desires. Selling iPods is what its all about.
post #52 of 121
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Based on what I see, the drop off is likely seasonal. Even still, the drop is not anywhere near the 65% reported.

Jan 06 to Sep 06 decline of 30%
YoY growth from Sep-05 to Sep-06 is 23%
post #53 of 121
post #54 of 121
well, ill tell you something for free, limewire's great!

the main ways i get my music:

senuti / other people's ipods
limewire
CD's
ITUNES
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post #55 of 121
The whole DRM thing was imposed upon Apple by the record labels. Now, the movie people want even tighter restrictions that will be even more unpopular with consumers. If the labels ease up on DRM, we'll all be a lot happier.

As Vinney57 said, it's all about iPod sales.

BTW, AAPL is down a couple bucks today. A month from now, sub-88 is gonna look mighty cheap.
post #56 of 121
Quote:
Originally Posted by tomkarl

It concerns me that this research company can access credit card purchase data. How is that possible if they aren't related to Apple?

My sentiments exactly.

This could be a topic in and of itself.
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post #57 of 121
I'm sure sales will peak again with the release of Ashlee Simpson's next Album (go on, you know you love her really)!
post #58 of 121
Quote:
Originally Posted by SpamSandwich

On the whole, I think iTunes could grow by merging services with Netflix (to include movie rentals with the downloads).

I agree. If Apple integrated NetFlix into iTunes like they did the Music store, Apple would become a very powerful force in the movie industry. Apple would be able to get Netflix customers to rent physical DVDs from them, RIP them, and then send it back to Apple.

The movie studios would be banging their door down to go digital then.
Apple could then ween it's rental customers away from physical DVDs to digital downloads over time.
post #59 of 121
Quote:
Originally Posted by mbaynham

well, ill tell you something for free, limewire's great!

the main ways i get my music:

senuti / other people's ipods
limewire
CD's
ITUNES

Don't forget your public library, hundreds or thousands of CDs and DVDs just waiting for you to rip for free.
post #60 of 121
Quote:
Originally Posted by calicomoonchild

I'm sure sales will peak again with the release of Ashlee Simpson's next Album (go on, you know you love her really)!

I'm shorting her record company and investing the proceeds in barf bags.

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post #61 of 121
Quote:
Originally Posted by Johnny Mozzarella

Don't forget your public library, hundreds or thousands of CDs and DVDs just waiting for you to rip for free.

never thought of that, good thinking!!
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post #62 of 121
Bwahahahaha...!

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post #63 of 121
Quote:
Originally Posted by vinney57

Good call Rolo. The conclusions sounded 'hyped'.

The important thing about iTunes is the infrastructure that they are building. Apple could service any model of DRM/encoding/payment that the world desires. Selling iPods is what its all about.

Exactly...do you think books will be sold physically for ever?
Once Apple come out with a decent eBook they will start selling books digitally. (Amazon's worst nightmare)
And the beautiful thing is the infrastructure is already there.
Books...Magazines...newspapers...textbooks... all digital
Fonts, stock photos, recipes, maps, software...can all be sold digitally
post #64 of 121
Quote:
Originally Posted by Johnny Mozzarella

Exactly...do you think books will be sold physically for ever?
Once Apple come out with a decent eBook they will start selling books digitally. (Amazon's worst nightmare)
And the beautiful thing is the infrastructure is already there.
Books...Magazines...newspapers...textbooks... all digital
Fonts, stock photos, recipes, maps, software...can all be sold digitally

I forgot to mention that Podcasting can be adapted for PDFs.
So instead of subscribing to a magazine, you subscribe to its PDFcast.
iTunes will auto-magically download the latest issue in PDF format and sync it to your Apple eBook.
post #65 of 121
Quote:
Originally Posted by Johnny Mozzarella

Exactly...do you think books will be sold physically for ever?
Once Apple come out with a decent eBook they will start selling books digitally. (Amazon's worst nightmare)
And the beautiful thing is the infrastructure is already there.
Books...Magazines...newspapers...textbooks... all digital
Fonts, stock photos, recipes, maps, software...can all be sold digitally

I know it's going to happen eventually, but previous attempts at eBooks have flopped for various reasons.
post #66 of 121
1) This btching and moaning about DRM is foolish. Especially by this group! You all knew the files had DRm and know there are other means that are cheaper to get the same music (and at hgher bit rates. If you don't like what is offered then you shouldn't do business with them.


2) DRM Dumpster is an iTunes plugin that will LEAGALLY convert your Protected ACC files to whatever format you desire. It burns your iTunes Store purchassed files to a CD-RW and then back again. Since it uses a re-writable CD it will repeat this process until your entire library is transfered.

3) I suspect iTunes will bump their songs to 192kbps in 2007. Though, I'd prefer they went to (Protected) Apple Lossless based on CD quality, with an option in iTunes to convert on the fly to Protected AAC, of various rit rates, to allow more storge of remote devices.

4) If eMusic averages about 25 cents per song and Apple is 99 cents per song how much money is Apple paying out to the music industry?

5) Why doesn't Apple offer higher resolution album covers, as well as every page of the album insert? It's such a simple and cheap value added service. On this note, they should add purchase optional subtitles for the hearing impaired; or a way to embed this info their files that can be turned on/off if needed.

6) I've heard that overall AAC is better compression than LAME's mp3 compression. Is this true? If so, how much better? How much do the previous answers vary change if the kbps increase/decrease dramatically.
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post #67 of 121
I am still buying CDs. They are higher quality and don't come with DRM. If they are of the sort that are labelled as 'copy protected' then they stay on the store shelf, even if want to buy it. Reasons for not buying online:
- DRM
- Quality
- Lack of availability outside of the USA and iTunes
- Inability to buy non-North Americain stuff, when in Canada. Online distribution should break down distribution barriers, but instead you are still limited by what the cartel has made availble to your country.

Another thing is that numbers can be played any way you want. Also, I am a customer and as long as I have product for which I am not dependent on the existence of the seller, then I am happy.
post #68 of 121
Quote:
Originally Posted by Johnny Mozzarella

Exactly...do you think books will be sold physically for ever?

Actually, yes I do.

Books have lasted a hell of a lot longer than the digital format du jour and the Internet. They'll still be around as the Net evolves into whatever it will be in 200 or 300 years in the future. Books kick the web's ass!

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post #69 of 121
Quote:
Originally Posted by solipsism

6) I've heard that overall AAC is better compression than LAME's mp3 compression. Is this true? If so, how much better? How much do the previous answers vary change if the kbps increase/decrease dramatically.

You are the best critic here for a number of reasons:
- Different types of music will prefer different types of lossy-compression algorithms, since each makes a certain assumption about the audio.
- If you have bad equipment then you will probably not notice things too much. On the other hand if you have high quality audio equipment the differences become more noticable.

There is one final factor that will make a difference: you! Basically it comes down to phsyiology, experience and what ever other factors might make you perceive sound differently from someone else.
post #70 of 121
Quote:
Originally Posted by Johnny Mozzarella

Don't forget your public library, hundreds or thousands of CDs and DVDs just waiting for you to rip for free.

Ha, same mindset is talking here. I love public libraries. They helped me
to build up my first 5000 songs into my iTunes library.

Btw, i strongly agree that it is all about selling iPods. That's it.
The iTMS is just a nice venture on Apples side, they do it just for kicks,
they just telling the music industry "look this is the future". It might be bright some time.
The model is not matured yet (quality issues), but you get the picture how it is gonna
work in the future.

I'm personally the cherry pick up type regarding iTMS, all in all i do prefer buying
CDs because of their superior sound quality.

cheers
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post #71 of 121
It's only moments away that the music industry will read this and demand that the FBI get the library records of people who check out "suspiciously high" numbers of CDs.

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post #72 of 121
Forrester is correct about sales slowing but it is wrong about a large decrease, as usual. And today's a great buying opportunity for Apple stock.

Go to the numbers. Apple mentioned 1.5 billion songs sold in its BMG Japan on iTS press release on 10/26/06. It's previous press release related to music or the iTS was on 10/5. So sometime between those two dates it passed 1.5 billion.

So Apple passed 1 billion songs on 2/23/06. Between 2/23/06 and 10/26/06, there were 245 days, in which it sold .5 billion songs, which is a rate of about 2.04 million songs a day. (If you assume the date was 10/6 instead of 10/26, the rate is 2.22 million.)

Apple passed .5 billion songs on 7/18/05. Between 7/18/05 and 2/23/06, there are 220 days, so the rate was about 2.27 million songs a day. So there was a decrease in rate over the time periods of about .23 million songs a day (or .05 million if we use 10/6).

But Apple has seen slower sales between May and Oct each year, and higher sales between Nov and Feb each year. So seasonality plays a role as well. Of course, the seaonality of music releases (and the quality or lack of quality) also play a role.

Plus, Apple has been selling more and more gift cards (don't have numbers but check out the ranking of gift card sales at the Apple Store). I don't believe Forrester included gift card sales at Apple Stores or other retail in their numbers.

And finally, the iTS now has other things for sale. More people are buying iPods with video and buying videos, or listening to podcasts. And did Forrester actually sort through all the transactions to determine the split between music and video, or did they use some heuristic?
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post #73 of 121
By the way, it took 812 days to sell the first .5 billion songs (4/28/2003 to 7/18/2005).
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post #74 of 121
Apple made pennies on all iTunes downloads anyway...

Itunes as an iPod/Music Library interface and manager or Jukebox Still shines regardless of how many users purchase through the store.

If you just use it to manage your CD collection (which could easily include thousands of CDs if you've been listening and collecting most of your life) it's the best software there is.

iTunes is free and is also the most amazing music manager and ipod, airport and stereo system interface there is.

It allows anyone to import any CD ( which most people own 'cause they bought it - (some, many years ago) at any resolution and it will rip, store and play at full resolution 44.1kHz if yiu choose.

What is all the fuss about people not buying full fidelity music from the iTunes store?

It's a choice some people obviously care or don't care about.

Though I own and purchased every one of the 10-20 thousand CDs I have, over many years, and don't appreciate degraded quality, I have one or two iPods full of Apple Lossles quality compressed CDs which I take on the road with me, because I can store more music on my iPod that way and if it means a compromise , well I'd rather that then have no music to listen to.

Music - we buy a CD we own it. We are not entitled to copy it for commercial gain, but we have always and will allways continue to make as many personal copies as we want or ever made on cassettes or any other media we chooses - Screw the record companies!

iTunes is GREAT JUKEBOX SOFTWARE that makes life easy for anyone who has lots of music in digital form.

Don't Panic less sales from iTunes doesn't mean Apple is going out of business or going to hurt at all.

We might even see iTunes used as a bridge between all the new forthcoming Apple products such as the IPhone, iTV etc....

Just like the iPod holds alot mor potential than an MP3 player so does iTunes as a package....
post #75 of 121
They are analyzing this wrong. iTunes is not as much about selling content as it is selling hardware. It is there to help sell iPods, not the other way around. It was a major reason I purchased my iPod 10 months after buying my first Mac, even though I already had an MP3 player. That's why iTunes is free - it's like a loss leader and it gives you an idea of what the iPod can do. Plus, iTunes allows Apple to say to the RIAA that their players do not encourage illegal downloads. So this study should mean nothing to Apple.
post #76 of 121
Quote:
Originally Posted by breeze

Though I own and purchased every one of the 10-20 thousand CDs I have, over many years,

This is where the labels are feeling the crunch.

There is no way in this age of downloading where you will find teens starting a collection like this. They will have hard drives full of music, not 10-20 thousand $10 cd's ($100k to $200k).

I imagine record label's revenue stream projections are in the crapper
post #77 of 121
I have owned an iPod for about a year now, an never purchased music from my own credit card.Everything I buy for myself is from gift cards. Everything I buy for others is in the form of giftcards as well.

All in all I spend about $200 - $300 a year in giftcard purchases for myself or others. Compare that to the $0.00 I spend directly through credit card at the store.

So I could see how this article is true... at least from this one aspect... for me. There are actually only a few people I know that actually purchase their music outright. They all seem to go the gift route as well.

Anyway, I think iTunes music sales are doing just fine.

just my 2 cents.
post #78 of 121
Here is my take of the situation. I would rather wait for Apple to release their quarterly or annual earnings report which contains the summary of iTMS profit or losses worldwide before I believe in Forrester's analyst.
post #79 of 121
I call astroturf-bullshit on this Forrester deal.
I'm sure it's quite similar to that paid "study" that was done a while ago asking people in a very sneaky way if 50% of them would be 40% likely to buy digital music players other than Apple ones if Ballmer would release their families from his private army's secure jail compound just outside of Seattle, on a Tuesday.
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post #80 of 121
Quote:
Originally Posted by ascii

The problem is that in every category except convenience, CDs are superior?

And which categories are these?
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