The typically rigorous
Ars technica claims to have intercepted an internal email sent to a few Apple employees yesterday. In it, Apple claims to be the number one music retailer in the US -- a boast supported by that screenshot of an NPD MusicWatch Survey. You seeing what we're seeing? Right, the data is from January 2008 and likely reflects people cashing in those iTunes gift cards and the giddy purchases made by new iPod owners. In other words, it's a spike on the total sales picture in NPD's
weekly MusicWatch survey. Then there's Apple's own claim on February 26th that it was now the
number two music retailer in the US. We don't doubt the authenticity of the data shown, we're just not ready to call Apple the #1 music retailer in April based on a week's worth of data tallied back in January. Something doesn't add up.
Update: We heard back from NPD on this, the response is predictable: "the information reported is apparently based on a proprietary leaked internal memo from Apple; therefore, NPD cannot comment on it." Nevertheless, we can confirm that Apple's February claim is based on NPD Data for the
full 2007 calendar year -- not an individual week or month. A sales victory for Apple in January, while significant if true, does not make them the top US music retailer "now" as claimed.
posted Apr 3rd 2008 4:05AM
The future is FREE!
Who cares
Well, we do. The day that a digital retailer surpasses Wal-Mart's brick-n-mortar business in music sales is big news. The Ars story is everywhere this morning as a result.
Thomas
@ Andrew
Steve Jobs and the Apple shareholders for a start!
I don't care either.
Not me.
Come on engadget...this is beyond blatant flame-baiting for Apple fanboys.
What are you talking about?
I like ARS, but there is quite a bit of Apple there. Then again there is everywhere.
Don't worry tommy, sooner or later it will add up . No need to panic:)
I've been using macs exclusively for over a decade and I think engadget has way too much Apple coverage. Yeah, their products are good, but seriously, it's a computer. They aren't making anything really ground breaking. iTunes is a good place to buy music and one day will end up having a monopoly that will get broken up by the US Gov, due to it's tie ins with the iPod, but in the end, it's just a music store.
If you feel like this, you should stop rewarding Engadget with your extra clicks and comments. Just move along.
You know smilespray, I have been hearing this comment as long as I can remember. Problem being, that if a site doesn't cover any Apple news, then people like you show up to complain that they don't cover Apple, and keep complaining until they cover every press release Apple puts out. Then, the moment someone complains about that, you turn around and, now that it is covering what YOU want them to, say that anyone who doesn't like it should just not come here.
Funny, if you would have followed your own advice, and just gone to Mac sites for your Apple news, then no one would be complaining to begin with.
Sure I see lots of stories about Apple on Engadget, but I also see lots of stories about Sony, Microsoft, Google, and Intel. Engadget seems to run a story on every new minor iteration of Samsung's SmartPhones, not just Apple's iPhone, but I don't see people complaining about Engadget's love for Samsung SmartPhones!
Apple is a big company with lots of products (computers, music, cell phones) and therefore generates lots of news. It's as simple as that.
Engadget is doing much better this past month with keeping a lid on the fluff Apple news, and bias then it has in the past year, so a few Apple stories isn't all that unexpected.
They aren't 100% there, but they are doing better.
I'm actually quite surprised the Apple Defence Force hasn't come out the woodwork and screamed to high heaven that Engadget has suggested Apple isn't beating Wal-Mart in distribution of digital music. There will be blood for your betrayal, Engadget!
@Evan: to try and accuse Engadget's coverage of Samsung smartphones as being as overkill as their coverage of the iPhone is a lost cause.
In fact, to try and compare the coverage of any other phone to that of the iPhone is a joke, none of them get anywhere near the idolatry the iPhone does around here.
@ L. M. Loyd:
I don't think my comment was particularly fanboyish.
My point was that "what's with all the Apple" posts and related flame wars generate lots more traffic and ad impressions, thus supporting the exact thing they are trying to quash.
Common sense...
If you look at how the figures are tabulated at the top of the document, then you will see that for physical retailers they count albums sold, but for download music they count every 12 tracks as an album. Now, the average of a CD is 12 tracks, but that in no way says that every CD has 12 tracks. It makes the figures somewhat ambiguous, since to really see who was selling the most music, you would have to know how many tracks are on the #1 selling album. For example, if one week an album with 9 tracks was the best selling album, then the figures for traditional resellers would be artificially inflated, where as if another week the #1 album had 17 tracks, then the download figures would be artificially inflated. Whether or not this effects this week in any way is impossible to tell from these figures.
Either way, what I find odd is that the real lead got buried, which is that neither iTunes nor Wal-Mart are actually anywhere close to being #1. When I look at this list, the first thing that jumps out at me is that 29% of all music is sold by mom-and-pop stores, rather than any of the big online or retail chains. It doesn't really surprise me that Apple would distribute any figure that could be in any way construed as them being the #1 anything, but I do find it odd to see people all over the web crowing about the fact that digital distribution as a whole has finally caught up with "Other" on the sales charts, as being some major milestone. Right at the top, they say that digital distribution is 29% of the market, which if I remember correctly puts it about 4% over this time last year, which is hardly stellar growth.
I think the digital distribution people would still say that they're making progress. Personally I feel that it eventually will be the #1 music distribution method.
Which, to me, is a shame. I enjoy the mom-and-pop stores. I think I'm a dying breed, but I prefer to own the actual CD, not a burnt copy, but the actual CD, complete with artwork and everything that comes with it. And for buying CDs/albums, I find the atmosphere in a small mom-and-pop store is better than shopping at a wal-mart or online.
Munkcy, I think that is the whole point. Sure, digital distribution has been making progress, but slowly. The thing I find the most interesting about these numbers is that you aren't in the minority. The interesting thing is that it would seem that more people like the mom-and-pop atmosphere of real music stores to the faceless experience of Wal-Mart, Target, Amazon, or iTunes. I think that is fantastic, and I think a much more interesting story than which multi-national megacorp has bragging rights of taking the most sales away from real music stores, which are still the ones selling the largest share of the music.
this is 2008.
not 1998.
get with the times.
its
"no Pirate Bay on that list?"
You know when those new things come out at a store and everyone buys them because they're like...like...new...? Well, they, like... don't count, 'kay? Only the old ones count... 'kay? 'Kay?
IMO, only complete dumbasses pay higher-than-cd prices for highly compressed, proprietary-formatted tracks from a site with a somewhat limited selection. It just goes to prove that no one ever got rich underestimating the lazyness of the American public.
I think you're just a dick.
Regardless of what you think of the people who buy music from iTunes, the fact is there are a lot of them and that gives them the power to shape future trends in music offerings.
Why do Apple fans always get so defensive? ;-p OK, I'm a dick because I object to iTunes. At least I realize it's ridiculous to pay a buck a song for 128b, AAC-encrypted, DRM-crippled tracks. It's also ridiculous that once I've done so, I've got to use a colonizing, proprietary software suite to load it onto a proprietary player that offers less features than many cheaper competitors. Closed architecture, so 1978. That's thinking different. iTunes is for people who don't know any better. If iTunes moves forward with their (compelling) subscription-based model, that's a completely different story. But for right now, it's just plain silly.
@Hiro11
Actually, most of iTunes songs are now 256 kbps and DRM free. They would have all their songs in this format, but, the music labels refuse to provide any more to iTunes in order to keep them crippled in an attempt to bolster competition.
EMI =/= "most".
No Shane, most songs aren't available on iTunes+.
There's a considerably smaller number available DRM-free as there is with DRM. And before you try, using the labels as a scapegost is bullshit - most of them now are signed up to other music stores, like Amazon's, which are completely DRM-free, so they clearly have no problem with it.
And anyway, songs on iTunes+ more expensive and most people don't know or understand the difference, so Apple is playing on a combination of ignornace and miserliness to push their DRM-infested songs onto customers, thereby trapping them in the perfect circle of iTunes and iPods.
@ Hiro
You are a little simplistic in your analysis, you assume the only decision people are making is based on the quality of the music. People make a buying decision for various reasons, quality, ease of use, reliability, speed of delivery. Apple iTunes taps into all these things and in doing so has secured a huge market. You do the American people a disservice with your simplistic assumption. I'm a sound engineer by profession but I know not everyone gives a shit about bandwidth and bit rates, they just want an easy way to get a tune. ITunes gave them that, you can bitch all you like but someone was a genius!
Hiro, just to point out a few inaccuracies with your original post: "Higher than CD prices" - Most CDs still cost more than $9.99, so that can't be true. "Highly compressed" - Yes, MP3 is a form of compression. So is AAC, although AAC retains higher quality than MP3 at the same bitrate. "Proprietary-formatted" - No. AAC is an open standard, there's nothing proprietary about it. If you're referring to DRM, you can bring that up with the record labels, or simply buy songs that are DRM-free. "A site with a somewhat limited selection" - compared to what? The iTunes store has the largest selection of downloadable music - period. If you're going to take that mindset, then by definition brick and mortar stores also have a "somewhat limited selection", since they don't carry all the music in the world in stock either.
And sure, convenience = laziness. It's a direct correlation. Everybody who likes convenience is a lazy slob. Got it. I'm assuming, since you probably wouldn't want to be labeled a hypocrite, that you don't actually use anything in your own life that could be labeled as a convenience? Like maybe a toaster (you're lazy, make toast on the stove), an alarm clock (you're lazy, get a rooster to wake you up), a washer and dryer (go down to the river and wash your clothes by hand, you lazy bum).
Clearly people who enjoy convenience are just lazy. There's no other possible explanation.
I don't really want to get dragged into a debate, but what the hell:
- A buck a track is a higher rate than the per-track cost of buying a cd. That was my point.
- 9.99 for a set of lossy tracks with no packaging/liner notes etc (some people actually want that stuff) is simply not a good deal. iTunes has extremely low overhead compared to a brick and mortar, iTunes pricing is a sop to the record companies. Let's be clear about what iTunes users are paying for.
- Your claim that AAC offers better performance than MP3 is, at best, highly debatable. It's probably not true at all at higher bit rates. Regardless, my main point is that 128kbps in any format sounds distinctly bad. I'm no audiophile but I can clearly tell the difference between a 128 AAC track and a cd (and so could most people, I'd assume). Overall, it makes no sense to pay a buck a song for music at 128kbps when you can buy a cd for essentially the same price and rip to lossless or WAV at your discretion.
- AAC isn't a closed standard, but it is certainly narrowly adopted. MP3 is a much more widely used standard than AAC from both an equipment and a distribution perspective. Why stick with something that offers marginal (if any) performance improvement while being forced to accept some huge tradeoffs in usability and platform acceptance?
- iTunes offers limited selection compared to any garden variety CD store in any mall. No Beatles, no AC/DC, no Zappa, etc, etc is hardly a complete selection.
- Calm down about the lazyness comment. Just internet bantering, don't take it so seriously. Fine, let's use the word convenience. Most people buy from iTunes because the store is built into the music management package for the iPod. The iPod store offers (for the reasons I've listed above) inferior product at a high price. My point is that it's clear that convenience is the motivating factor for using the iTunes store, not the relative quality of the offering. Even competing online stores are equally easy to use, it's just that the iTunes store is built into iTunes. That's the genius of iTunes: not the technology, not the wares on offer... it's the marketing and distribution.
In the final analysis, none of this matters as everyone really uses torrents. iTunes is a fig leaf for the true reason behind the popularity of the iPod.
@ Hiro
If 'none of it matters' why flame the forum with your crap!
I'm going to be laughing my head off when the next big media player comes along... that music isn't going anywhere.
Right now, I either buy the CD or get it though Zune Pass. DRM is acceptable as long it's something that enables you, not disables you. Companies wouldn't have subscription music services without it.
How is the zune DRM any less of a festering boil on the face of humanity than the iTunes one?
Its subscription-based, if they fold over, I don't lose anything other than the access, which I can get from another provider. I realize that no other services will work with the Zune, but by the time Zune Pass dies, it will be time to upgrade the player anyway. With iTunes, you are stuck with the music you bought, because you bought it, there is a loss because you can't just sign up for a different service and redownload it. I didn't say I ever bought anything from the Zune Marketplace, just subscription.
BTW, Zune now has a good selection of MP3 downloads available as well, if they don't have what you want in MP3, there's always Amazon.
You are aware that they cracked the DRM right?
Yeah, the iTunes DRM removal requires re-ripping, whereas the Zune/WM DRM can be removed by direct decryption if you're not using Vista with the newest updates.
Somehow i doubt this
On the actual topic of the post, I have to disagree. The data shows iTunes as the largest single share which makes them number 1. The fact that a lot of songs were bought with gift cards is not relevant - many albums from brick and mortar stores could have been purchased with gift cards as well. A sale is a sale as they say in the sales business. That doesn't mean that Walmart and Best Buy won't move up in the future, but until someone shows some data to that effect we are stuck with iTunes as the #1 retailer.
Since we heard last month that iTunes was number 2 then I suspect it was based on data from a month before this, neatly showing a progression.
I would be really interested to know the breakdown of the Amazon number between CDs from Amazon.com and digital files from AmazonMP3. They appear to be the only other viable pay site for digital music.
Yes, the gift card issue is irrelevant. Money is still being exchanged for music. Maybe the latest figures are a blip, and maybe iTunes will quickly lose the top spot. As for the 'giddy' new iPod owners, they might just continue purchasing music from iTunes.
Right there with you, Alan. A sale is a sale. iTunes will continue to gobble up a big market share % so long as people are still buying iPods. The trend is moving toward people not buying physical records, online retailers selling more downloads, and artists empowering themselves to release music on their own terms.
This.
Nothing is being 'debunked' here. If anything, Engadget (and others now, it seems) are offering a possible explanation for iTunes' rise to the number one slot. Sales have been made. Apple might not be making it very public due to this explanation or a desire for another month's worth of data so they don't look silly if they fall to the number two slot again.
Engadget, your behavior here is pathetic. You are calling out Ars for their headline, trying to say that Ars is wrong to say "now" based on most recent data from NPD (even though the Ars story is super clear to anyone who reads it).
You made similar claims about Apple being #2 in February, based on December data, and even used "now" in your February title about that December data:
"iTunes now number two US music retailer"
http://www.engadget.com/2008/02/26/itunes-now-number-two-us-music-retailer/
This looks to be a case of sour grapes. Engadget didn't get the story, so they tried to trash the story. Engadget does the very thing they claim to be debunking.
I see this kind of thing here at Engadget more often than I'd like.
Apple has issued a PR: http://www.apple.com/pr/library/2008/04/03itunes.html
"Apple® today announced that the iTunes® Store (www.itunes.com) surpassed Wal-Mart to become the number one music retailer in the US, based on the latest data from the NPD Group*. With over 50 million customers, iTunes has sold over four billion songs and features the world’s largest music catalog of over six million songs."