The iPod initiated the demise of the music industry. It introduced the concept that we can download (steal) music files than were small in size over the internet (Napster), which led to everyone not paying for music anymore.
I would say that Apple and iTunes helped save the music industry. Napster was happening with or without the iPod. The record labels were still being run by executives that barely understood email, much less mp3 music files. Apple came up with the iTunes Store with a reasonable price of 99¢ a track, and a way to carry the music with you. This brought a lot of people back to buying music rather than download files from the internet that were often fakes or bad quality.
Very much this (CasinoOwl's post). The iPod wasn't the first portable digital music player (remember Slashdot's famous response to the iPod announcement? "
No wireless. Less space than a nomad. Lame."). It was the first with a compelling story for the masses.
The record labels were used to selling $15-$20 CDs to people who wanted 1 song, meanwhile the technology of storing music in digital files was coming on like a freight train, and their reaction was mostly to hold their breath and stamp their feet. Millions of kids were each amassing collections of tens of thousands of essentially looted songs (years before the iPod existed - I worked at a university, saw a lot of this), and the industry saw it
only as a thing to fight against (rather than an indication of where technology was going). Their feeble forays into the digital waters were horrid things that
deactivated songs on one machine when you put them on another (want to listen both at home and on the go? just deactivate the tracks on one and activate them on the other -
every time).
Left to their own devices, the music industry was setting itself up to be eaten alive by millions of freeloaders. Steve Jobs effectively held out a hand to them, in the style of the Terminator to Sarah Conner, and said, "
come with me if you want to live!" He successfully argued them out of a lot of the unrealistic things they wanted to impose, and got them to agree to simple rules like "songs are available individually and every track is 99 cents". This
saved the music industry. It wasn't every unrealistic thing they wanted, to be sure, but it was a workable path to keep selling music. A
lot of people were/are happy to buy music, if doing so is relatively painless. The industry could have kept a bunch more money for themselves by building something like iTunes (and its built-in store), but it seems they weren't capable.
Later, after Apple paved the way (and was wildly successful at it), others built successful competing systems, and the music industry actively tried to damage Apple's lead by granting things to the competitors while withholding them from Apple (leading many to complain
at Apple because iTunes tracks had DRM after others were DRM-free - even though DRM was something Apple had added to gain the record execs agreement in the first place). Eventually Apple got the ability to sell DRM-free tracks, and higher bit rates, in exchange for letting the record companies break the every-track-is-99-cents simplicity into multiple pricing tiers.
I'd argue that agreeing to music streaming arrangements has been
much more damaging to musicians, if not the music industry.
