iTunes Sells 1.5 Million Songs Last Week

[astern]

wall street

my friend, if apple is not about the markets (wall street in general),

THEN WHY DID THEY NAME A POWERBOOK "WALL STREET"???



Andrew

 

[Frisco]

Originally posted by Vector
Why is that. I am a daytrader and must really care about stock quotes.

Do you have stock in Apple computer? Do you recommend purchasing Apple stock to your clients? I doubt you do either.

Sorry to answer a question with a question!

ps: Don't answer my questions--answer yellows, "Why then does Apple stock suck?"

 

[superfula]

Originally posted by Kid Red
According to C/Net-299,923 of those songs were download by the RIAA to help initiate the concept.

Do you have a link for that story?

 

[Vector]

Originally posted by Frisco
Do you have stock in Apple computer? Do you recommend purchasing Apple stock to your clients?

Sorry to answer I question with a question!

I have about a $5,000 stake in my long-term holdings portfolio. I would recommend that anyone buy apple if it is below 20 and has not had some news that would greatly inhibit future revenues or continuing operations.

 

[yellow]

This is the last time I will drag this thread so far askew..

I am quite pleased with what the stock has done for me, perhaps I should be more clear in my complaints. With the advent of iTunes for Windows, significant sales of songs, hardware, Panther, etc.. I would expect Apple to at least be making some larger gains on their stock. How selling 1.5 million songs in a week translates to a few cents loss is beyond me. But I'm not a trader, which is probably a good thing.

 

[Frisco]

Originally posted by Vector
I have about a $5,000 stake in my long-term holdings portfolio. I would recommend that anyone buy apple if it is below 20 and has not had some news that would greatly inhibit future revenues or continuing operations.

I am glad to hear that

If I had the money to invest I would put it in Apple stock too. " I will go down with this ship." quoted from Dido-"White Flag" at the ITMS--where else?

I am not saying that Apple will fail--all I am saying is that I will be with Apple until then end--the end of Apple or the end of me.

 

[ebow]

Originally posted by jxyama
300k for napster, eh? i might be mistaken, but this is the first time i've ever heard a "solid" sales number from vendors other than iTMS.

anyone know about buymusic.com? others?

I would imagine that BuyMusic must be up to some stunning number like 50 or even 60 downloads per week. Watch out--they're on fire! Oh wait, they're probably just torching their servers for the insurance money...

(what the hell am I talking about... back to work!)

 

[Vector]

Originally posted by yellow
This is the last time I will drag this thread so far askew..

I am quite pleased with what the stock has done for me, perhaps I should be more clear in my complaints. With the advent of iTunes for Windows, significant sales of songs, hardware, Panther, etc.. I would expect Apple to at least be making some larger gains on their stock. How selling 1.5 million songs in a week translates to a few cents loss is beyond me. But I'm not a trader, which is probably a good thing.

The fact that apple has sold that many songs in a week does not really figure into the stock price very much. It is nearly impossible to determine why exactly the market reacts the way it does to news. Many times a falling price after good news is due to profit taking by short term investors, but prices basically follow the general theory of "Oh look what those investors are doing, we had better do the same". If people see increased selling over buying then more and more people start to sell causing the price to decrease. If people see that buying is increasing then more people jump on the wagon and buy the stock.

You shouldn't read anything into a few cents change. This is just the result of the fluidity of trading, and the sellers could outnumber the buyers for any number of reasons beyond the idea that they think it is bad news.

 

[Tim Flynn]

Since the music store is a loss leader for selling iPods.
The question is, how are iPod sales?

 

[tychay]

Originally posted by jxyama
300k for napster, eh? i might be mistaken, but this is the first time i've ever heard a "solid" sales number from vendors other than iTMS.

anyone know about buymusic.com? others?

According to Nielsen SoundScan, that 1.5 million downloads accounted for 80% of the total download market share that week. Yeah, this means Apple is still at 80% same as before the launch of iTunes for Windows. A lot of people forget that Apple is posting 2.5x the numbers they were posting before the launch of iTunes for Windows so even though Napster took a good chunk, they were eating into a growing market that Apple keeps taking the largest slice.

Another thing to consider is that (I believe) the 5 free downloads given to every early adopter of Napster's service counts toward the 300k downloads that week. This means the numbers should drop off to about 150k next week and Apple's marketshare toys dangerously with market dominance--perhaps the dreaded "M" world (no, not Microsoft--Monopoly) if the music download business wasn't such a nascent and volatile one in addition to the obvious fact that there are substitutable products like CDs, radio, and music subscription services which would count against what would be called the "market".*

IMO, 300k is a respectable number for the debut of Napster 2.0 née Pressplay. It would have been labeled a hit if Apple's iTMS hadn't raised the bar (twice) since then (600k in first week of release, 1 million in first half week of Windows release).

A ~150k/week posting by Napster which steadily increases (+ a spike when the Samsung player debuts) probably spells death for BuyMusic and does more to eat into MusicMatch's potential market than it does Apple's. That's typical of new entries in the tech market they eat the weak fish first. Example: Linux eating into UNIX marketshare before even touching Windows.

If I were a betting man, I would be more worried about Microsoft's offering mid-2004 since it also has a media player which will probably be sold at a lost or at cost and MS will strong arm OEMs into bundling the enabling software--yes, the anti-trust settlement fails in the face of history.

* This is why Apples dominance of the Macintosh doesn't satisfy the revisionist criteria of a monopoly in the legal or economic sense. Taking the looser economic sense ("exclusive control of a product or service"): say Apple were to own 100% of the download market (impossible, but lets say) raise the price of downloads to $3 (something a monopolist can freely do), most people would simply buy CDs and rip their own or purchase Rhapsody or Napster's subscription plan. Apple's revenues and profits go down and market forces keep them from doing so.

Take care,

 

[itsbetteronamac]

WOOT! Go Apple!

I wish napster would just leave, and all the other late players. Why try to get a small piece of the pie? In 1-2 years only the big orginal players will be around aka APPLE!

 

[GregA]

I know this is slightly off topic - but I just got an email from a work friend (he's a system administrator for multiple Windows sites) who I'd told to try iTunes - had to share it.

iTunes v Media Player
Greg,
I have compared these two products, and as a result I am now only using iTunes and could almost be tempted to buy an iMac!!!

Yes, I will be letting him play with my iMac next.

Unfortunately we can't buy online music in Australia - he'd spend a chunk on iTMS. He could easily become an iPod convert though (I'd guarantee it if a car-dock comes out).

[edit] I'd also like to thank Dell computer (and Microsoft) for 2 computers which had an Audio problem with WMP9 - they recommended a full reinstall of Windows (yuck) - yet iTunes works flawlessly.

 

[TomSmithMacEd]

I'm sorry to get technical, but Apple only makes 27 cents a song not 30. Sorry!

 

[The Ancients]

Well...

...life always dishes up the good with the bad...

 

[Vector]

Originally posted by Tim Flynn
Since the music store is a loss leader for selling iPods.
The question is, how are iPod sales?

It is a loss leader (which is unexpectedly producing minor profits), and last quarter ipod sales were about 300,000. This is up from 78,000 units from, i believe, the same quarter of the previous year.

 

[Mason]

Correct me if my math is wrong, but since iTunes sold 1.5 million songs at 80% market share and Napster sold 300,000 songs, doesn't that mean the rest of the online downloading services sold a combined total of about 75,000 songs?

If that is the case, and the trend continues, I imagine it's only a matter of time before the other competitors start going under.

 

[billyboy]

iTMS needs competitors though. Its like if you go buy a house, in the UK at least, you find estate agents in one street, banks and building societies congregate in another. Each part of town becomes like a net for everyone in a particular market. As people gravitate towards this freaky new idea of buying music on the internet, they will try out the various offerings, find the service they like, and that then means businesses are obliged to maintain an edge because the market will be calling for people to look around at this new offering, that new idea, so there is a constant healthy threat of customers looking around and maybe moving on. Innovate or die.

The days of a MS type inertia, when people stick with what they first try, are numbered from day one in the music game, because Apple have made such a huge splash, and immitators are frothing at the mouth trying to make an impression. Hopefully Apple being more universal now, wont stop reminding people just how brainless it is to go the iTMS (and iPod) route. And likewise other companies will shout and scream about how amazing they think they are as ITunes killers. It costs nothing to try iTunes, so immediately that is a barrier less for people who maybe are faced with $9.99 a month to try out a new subscription service. And remember, as MS like to tell everyone, Windows users like choice and they like free and they like quality. iTunes just fits the MS bill of excellence a bit better than the rest - at the moment.

 

[woodsey]

In my opinion, this is what apple must do if they are truely going to dominate the online music market.

1. Work like hell to get the music store available to those outside the US, thus increasing revenue from song sales, and especially iPod sales.

2. Make music previews work on dialup connections. It's impossible to get a feel for a track when i have to wait thirty secconds just to listen to five secconds of the song, before it lags again!

 

[Vector]

Originally posted by woodsey

2. Make music previews work on dialup connections. It's impossible to get a feel for a track when i have to wait thirty secconds just to listen to five secconds of the song, before it lags again!

Are you on dialup?

Apple is probably not very concerned with having its service work well with dialup connections. Sure Apple would like to sell to dialup users, but dialup users are not a market that Apple will actively court. Dialup connections are going to take a while to download previews and songs, and most dialup users are not willing to spend the time to download a song. It isn't as if Apple can just all of a suddenly say "i think we should make itunes work with dialup". The problem you cite is one of connnection not apple's service. Apple could make the previews lower quality, but this would still not address complete downloads.

 

[greenstork]

Originally posted by Vector
I have about a $5,000 stake in my long-term holdings portfolio. I would recommend that anyone buy apple if it is below 20 and has not had some news that would greatly inhibit future revenues or continuing operations.

Just of curiosity, and I'm not saying this to be antagonistic, but what upside does Apple have right now. They've just "blown the wad" so to speak with all their new product releases in the last year (read iTMS, iTunes for Windows, G5, Panther, etc.) Maybe I'm just being naive but I'm not sure what's in the pipeline right now. the stock market is all about what have you done for me lately.

Before everyone on this thread flames me, I know Apple could come out with some new must have gadget, they always do. However, people were expecting and rumor-mongering over the past years releases for a long time now and I don't see any rumors on the horizon that are as earth shattering as iTMS, the G5, and Panther were this year. I'm curious what others think.

 

[Target]

Originally posted by woodsey
In my opinion, this is what apple must do if they are truely going to dominate the online music market.

1. Work like hell to get the music store available to those outside the US, thus increasing revenue from song sales, and especially iPod sales.

2. Make music previews work on dialup connections. It's impossible to get a feel for a track when i have to wait thirty secconds just to listen to five secconds of the song, before it lags again!

1. They probably are. They are actively working on Canada so I would expect they are doing what they can in Europe (or individual countries) as well.

2. Check iTunes Preferences.... Store, check "Load complete preview before playing."

Domination may just be the word.

 

[yellow]

Originally posted by woodsey
1. Work like hell to get the music store available to those outside the US, thus increasing revenue from song sales, and especially iPod sales.

This may be a logistical nightmare with foreign currency -> USD exchange rates.

 

[Wash!!]

Woo!!

Originally posted by tychay
According to Nielsen SoundScan, that 1.5 million downloads accounted for 80% of the total download market share that week. Yeah, this means Apple is still at 80% same as before the launch of iTunes for Windows. A lot of people forget that Apple is posting 2.5x the numbers they were posting before the launch of iTunes for Windows so even though Napster took a good chunk, they were eating into a growing market that Apple keeps taking the largest slice.

Another thing to consider is that (I believe) the 5 free downloads given to every early adopter of Napster's service counts toward the 300k downloads that week. This means the numbers should drop off to about 150k next week and Apple's marketshare toys dangerously with market dominance--perhaps the dreaded "M" world (no, not Microsoft--Monopoly) if the music download business wasn't such a nascent and volatile one in addition to the obvious fact that there are substitutable products like CDs, radio, and music subscription services which would count against what would be called the "market".*

IMO, 300k is a respectable number for the debut of Napster 2.0 née Pressplay. It would have been labeled a hit if Apple's iTMS hadn't raised the bar (twice) since then (600k in first week of release, 1 million in first half week of Windows release).

A ~150k/week posting by Napster which steadily increases (+ a spike when the Samsung player debuts) probably spells death for BuyMusic and does more to eat into MusicMatch's potential market than it does Apple's. That's typical of new entries in the tech market they eat the weak fish first. Example: Linux eating into UNIX marketshare before even touching Windows.

If I were a betting man, I would be more worried about Microsoft's offering mid-2004 since it also has a media player which will probably be sold at a lost or at cost and MS will strong arm OEMs into bundling the enabling software--yes, the anti-trust settlement fails in the face of history.

* This is why Apples dominance of the Macintosh doesn't satisfy the revisionist criteria of a monopoly in the legal or economic sense. Taking the looser economic sense ("exclusive control of a product or service"): say Apple were to own 100% of the download market (impossible, but lets say) raise the price of downloads to $3 (something a monopolist can freely do), most people would simply buy CDs and rip their own or purchase Rhapsody or Napster's subscription plan. Apple's revenues and profits go down and market forces keep them from doing so.

Take care,

Talk about the glass is almost enty according to you apple should be out of business by now omg the sky is falling!!!

 

[Vector]

Originally posted by greenstork
Just of curiosity, and I'm not saying this to be antagonistic, but what upside does Apple have right now. They've just "blown the wad" so to speak with all their new product releases in the last year (read iTMS, iTunes for Windows, G5, Panther, etc.) Maybe I'm just being naive but I'm not sure what's in the pipeline right now. the stock market is all about what have you done for me lately.

As far as stock price goes, apple does not have much of an upside if one were to invest right now. Investors react to Apple differently than they do most stocks. As long as apple only has a 3% market share (please do not correct me here because i just chose this number to demonstrate my point), investors, for the most part, will see apple as a niche player who could be out of the game in the near future if they do not continue to innnovate.

It does not matter that apple has nearly $12 per share in cash or cash equivalents, or that they have an extremely loyal customer base. The only times that apple's stock is going to do well is when the market thinks that the company is doing a good job of reaching out beyond its traditional customers in order to gain new market shares or to increase already existing ones. When the iMac was such a success in terms of sales to new users and in financial terms the stock price rose greatly, then the increase in new users slowed and the price of apple's stock fell 25 points in one day (due to an unexpected sales slump). When apple released the music store, the price went from around 14 to 24 on the news of apple's success through innovation in a field were others had failed. The price then went down on profit taking and the realization that there were as of yet no financial statistics to support the new valuation. The price has gone back up some since this as a result of apples's release of itms for windows and continued strong sales of music and ipods.

Apple's stock will not see another large jump (and probably will not break 27 until they do something that shows that they are concerned and have the ability to reach into new markets and convert more people to apple products. The market doesn't really care that apple released a G5, or that they had speedbumps on other models because for the most part this is not going to greatly affect apple's cash flows. The people who were buying G4s will now buy G5s the money is just shifting places rather than coming in more (although the G5 could lead to marginal gains in sales in certain segments). The market does not bet on what it does not understand, thus it only reacts to news that is almost certainly going to help or hurt apple and will not react much to expected minor advancements in current product lines. The market does; however, seem to react to news of decreased pricing on apple's products as it clearly sees that this is a needed and helpful step for apple to gain sales and the losses from a lower price are easily offset by the increase in sales.

I just realized that you also mentioned Panther. For the most part, the market is not interested in apple's software operations as they are mainly tools that serve to sell apple's hardware (save multiplatform software and of course itunes).

 

[ryaxnb]

Originally posted by Mason
Correct me if my math is wrong, but since iTunes sold 1.5 million songs at 80% market share and Napster sold 300,000 songs, doesn't that mean the rest of the online downloading services sold a combined total of about 75,000 songs?

If that is the case, and the trend continues, I imagine it's only a matter of time before the other competitors start going under.

'
iLike iTMS a lot but looking at reviews, player compatibility, etc. MusicMatch is better then Napster. It must continue! I had high hopes for MusicMatch to be a good competitor to iTunes (giving companies reasons to improve their products.) I hope it still will work. Also, if Dell's stuff really is a rebranded MusicMatch or better yet it just works with MusicMatch, then things bode well for MusicMatch, since Dell's player appears better then Samsung's (but I'd rather use and iPod, of course)