Apple considering 'dramatic' overhaul of iTunes Music Store to boost sales - report
Facing significant declines in digital music sales, Apple is reportedly plotting a potential overhaul of its iTunes Music Store, in addition to considering new revenue opportunities through on-demand streaming and even allegedly an iTunes for Android.
Executives at Apple apparently had high hopes for iTunes Radio to help boost sales of songs on the iTunes Store, but to date only between 1 and 2 percent of listeners are purchasing content, according to Billboard. That's led to "hotly debated" possibilities within Apple and with its content partners about the future of iTunes.
"Apple's desire for a smooth transition is complicated by an urgency in by an urgency that iTunes must move quickly as people move away from downloads, where Apple controls 90% of download music sales in the U.S., towards streaming, where Apple is overshadowed," the report said.
Sources within the music industry have apparently portrayed the debut of iTunes Radio as "underwhelming," while the cloud-based iTunes Match service is alleged to have "only" 1 million subscribers.
One music executive said they expect iTunes to be "completely different" in the next 3 to 5 years. People at Apple are apparently feeling the heat from streaming services like Pandora and Spotify, which are eating away at traditional music sales.
Wednesday's report is light on details about what exactly Apple might do to overhaul the iTunes Music Store, but Billboard did indicate last month that the company is allegedly considering a version of iTunes for Android. Another potential option said to be on the table is a new on-demand music streaming service, much like Spotify.
Those possibilities were presented again Wednesday, with the prospect of iTunes for Android specifically portrayed as a consideration that "weighs no less heavily" on Apple executives than when late co-founder Steve Jobs decided to debut iTunes for Windows in 2003.
In light of an erosion of downloads by all-you-can-eat streaming services like Spotify and Beats Music, iTunes still holds considerable sway in the industry, generating more than 40 percent of U.S. recorded music sales revenue. That represents a huge bargaining chip for Apple in pushing for an expansion of its own streaming service.
On the streaming front, Pandora dominates with nearly one-third of the market, while recent data suggests that iTunes Radio is already bigger than Spotify, despite launching in late 2013. But Apple had apparently hoped that iTunes Radio might have a greater effect on music sales than the service has thus far.
Executives at Apple apparently had high hopes for iTunes Radio to help boost sales of songs on the iTunes Store, but to date only between 1 and 2 percent of listeners are purchasing content, according to Billboard. That's led to "hotly debated" possibilities within Apple and with its content partners about the future of iTunes.
"Apple's desire for a smooth transition is complicated by an urgency in by an urgency that iTunes must move quickly as people move away from downloads, where Apple controls 90% of download music sales in the U.S., towards streaming, where Apple is overshadowed," the report said.
Sources within the music industry have apparently portrayed the debut of iTunes Radio as "underwhelming," while the cloud-based iTunes Match service is alleged to have "only" 1 million subscribers.
One music executive said they expect iTunes to be "completely different" in the next 3 to 5 years. People at Apple are apparently feeling the heat from streaming services like Pandora and Spotify, which are eating away at traditional music sales.
Wednesday's report is light on details about what exactly Apple might do to overhaul the iTunes Music Store, but Billboard did indicate last month that the company is allegedly considering a version of iTunes for Android. Another potential option said to be on the table is a new on-demand music streaming service, much like Spotify.
Those possibilities were presented again Wednesday, with the prospect of iTunes for Android specifically portrayed as a consideration that "weighs no less heavily" on Apple executives than when late co-founder Steve Jobs decided to debut iTunes for Windows in 2003.
In light of an erosion of downloads by all-you-can-eat streaming services like Spotify and Beats Music, iTunes still holds considerable sway in the industry, generating more than 40 percent of U.S. recorded music sales revenue. That represents a huge bargaining chip for Apple in pushing for an expansion of its own streaming service.
On the streaming front, Pandora dominates with nearly one-third of the market, while recent data suggests that iTunes Radio is already bigger than Spotify, despite launching in late 2013. But Apple had apparently hoped that iTunes Radio might have a greater effect on music sales than the service has thus far.
Comments
Maybe they should work on making itunes and the itunes app run more smoothly. It's a behemoth of an application at this point and it takes forever to do anything.
Wow, that seems insanely low. I've purchased a ton of stuff simply due to iTunes Radio, so have other people I know.
It may simply be that music sales across all categories are shrinking because the "last mile" is full of people who will never pay for music.
So... its more like Apple is now making Themes and Skins for their software.
iOS 7 (except some APIs)
is one theme of iOS. 
imo Apple needs to enter the mid-range market with a $300 phone to regain critical mass on its ecosystem. itunes on android will also help, but its better to offer cheaper hardware to keep selling music, apps, movies, ....
I expect the next article to be more dire.
Let see most music today has an attention span of what a month and on to the next piece of garbage.
What I think we are observing is this, when albums came out people bought the most popular music, then 8 tracks came out and people re-purchased, then cassettes, then CD and then Digital. Now people have bought all the most popular songs they like in digital content and since there is nothing new and there is no need to replace digital content people do not have to re-purchase what they already own.
We are now at the end of the life cycle of music content purchasing cycles, There is no reason to buy anything new and if people are like me in my house, all my kids have all my music as well, once they get bored of the crap autotune stuff that most artist put out today, they turn back to the classical R&B, Rock and so on.
Unless Artist put our music which can stand the test of time new generations of buyers are not going to seek out their music they listen to it for a while and move on. Everyone who planned to buy from Itunes have already did so and most likely are sharing it with their families as well.
Yeah you got Streaming content but that can be a bandwidth hog if everyone is doing it on their mobile devices.
iTunes Match is not an option.. my data plan is 2Gb limite per month.
lossless audio, and an overhaul of the iTunes app on OSX and Music app on iOS.
Offer Apple Loseless Audio Codec albums or high resolution alternatives...get on the bandwagon Apple!
Offering lossless music is only going to satisfy a fraction of a percent of the population. It's a non-issue for the vast majority of the music listening world.
Let see most music today has an attention span of what a month and on to the next piece of garbage.
What I think we are observing is this, when albums came out people bought the most popular music, then 8 tracks came out and people re-purchased, then cassettes, then CD and then Digital. Now people have bought all the most popular songs they like in digital content and since there is nothing new and there is no need to replace digital content people do not have to re-purchase what they already own.
We are now at the end of the life cycle of music content purchasing cycles, There is no reason to buy anything new and if people are like me in my house, all my kids have all my music as well, once they get bored of the crap autotune stuff that most artist put out today, they turn back to the classical R&B, Rock and so on.
Unless Artist put our music which can stand the test of time new generations of buyers are not going to seek out their music they listen to it for a while and move on. Everyone who planned to buy from Itunes have already did so and most likely are sharing it with their families as well.
Yeah you got Streaming content but that can be a bandwidth hog if everyone is doing it on their mobile devices.
I'm one of the 1-2 percent of iTunes Radio listeners that bought content. But truth be told, I probably buy more music through Shazam on iTunes, than iTunes Radio.
and I agree with this. I'm finding I buy 'deep tracks' from the old stuff [pre-1990]. I rarely[never] buy new [2011-on] stuff. I look at my kids (now adults), and a large percentage [25-35%] of their music is 'my' music, from before they were born.
I think the over all tenet of this article is... ITMS is a massive store and every method of driving people to something to buy (Ping, Radio, genius, Match, album complete) has scraped all the remaining sales, or failed to generate sales at all [Ping]. Most people 'listen to music' (even I keep Classical music streaming from Minnesota Public Radio on my Mac Mini while I'm working), but it's background filler... Streaming is that... and Apple came in 4th in establishing that beachhead. It may be a struggle to regain that... but I think music is now the give away anyway....
It's not the layout, it's the price...
This is a direct consequence of Apple free falling market shares in iphones and ipods. With android having over 80% market share worldwide, that means all those people are buying songs from google or other offering on android.
imo Apple needs to enter the mid-range market with a $300 phone to regain critical mass on its ecosystem. itunes on android will also help, but its better to offer cheaper hardware to keep selling music, apps, movies, ....
The vast majority of the Android public is buying nothing from Google. Streaming stuff from the web maybe. Buying? Not so sure about that.
It's not the layout, it's the price...
Its not the price, its the layout.
If Apple wanted to compete with Pandora they should have put a big button right on the first page of the default Home Screen that says RADIO. After 5 minutes with it no one would seek out Pandora.
Unfortunately I doubt users can find iTunes Radio. Even though its the first thing that pops up on you when you open the Music app for the first time, you're not looking for Radio, you're looking for your "iPod" and will likely dismiss it.
BTW, Apple is NOT considering iTunes for Android.
If the scheme is to make more money selling music, the last thing they're going to do is make iTunes available to Android users. They don't buy squat.
The 'increase' from that wouldn't even register on a pie chart.