How Apple Music Store Killed the Old Music Industry

When Tower Records, a chain of sacred music stores with a 46-year history, closed in late 2006, The Nation called him “The day the music died.”

Some cried murder, blaming iTunes and the digital music revolution it fueled. An era of musical discovery – rummaging through stacks of records or CDs while chatting to staff who ate, drank and breathed music – was over. Who would want to carry around a clumsy Discman when the sleek little iPod was around? “Even Bob Dylan was buying iTunes in a TV commercial,” wrote the article’s author, Max Fraser.

Apple launched iTunes a few years ago on April 28, 2003, and quickly reigned supreme. The iconic ads – dancing silhouettes against brightly colored backgrounds – were impossible to ignore. “A thousand songs, in your pocket,” sang the voiceover of some. All your music with you, wherever you go.

Once you had an iPod, the iTunes Store had you. Who wanted to buy an overpriced CD, go home, put it in a computer, rip the tracks and then sync them to a gadget?

A customer leaves a Tower Records store in lower Manhattan October 11, 2006.Marie Altaffer/AP

The iPod allowed Apple to make its mobile computing revolution, with a little help from its red-hot multimedia store.

“Look at the iPhone, the iPad – even the iPad and desktop computers – they would make much less sense without the media strategy that is iTunes,” said Rome Thomas, senior vice president of sales and development. artists at A&M/Octone Records. NBC News.

Today, on its 10th anniversary, with over 26 billion songs sold, iTunes remains an entertainment powerhouse, having expanded into movies and TV shows and, of course, apps. How is the entertainment industry different? And what does Apple have in store for us as iTunes enters its second decade?

“Apple’s new service has a good chance of winning over skeptics on both sides of the aisle, says an analyst.” wrote PCWorld’s Tom Mainelli after the unveiling of the iTunes Store.

At the same time, others like Victor Keegan of the Guardian, expressed a doubt. “[T]The allure of it all could wane if Apple’s first-mover advantage evaporates,” he wrote.

legalize it
The concept of downloading music was not a breakthrough. Napster, a peer-to-peer file-sharing service, existed before iTunes was a snap in the eyes of Steve Jobs. Like other similar services. Once enough people realized that Napster and its ilk were in fact breaking the law, legal alternatives were dreamed up by anyone with an interest in music or technology.

“There were people doing that 10 years before, but I think [Apple was] the first to really bring it to market,” Russ Crupnick, senior vice president of industry analysis at NPD Group, told NBC News. “They had a good library of music that we really wanted to buy and listen, had a great interface and a reasonable price.”

At $9.99 per album or 99 cents per song, Apple offered an affordable alternative to piracy. And while some objected to paying for the music, what you got in return was quality. Do you remember the disappointment of finding out that the song you got off LimeWire was actually a badly recorded cover instead of the real song? Oh, the wasted time (and bandwidth)!


But Apple had to walk a tightrope.

Sure, offering legal online music sales was something the big labels were interested in doing, but they were charging $16 or $18 per CD, and suddenly Steve Jobs said he’d sell their music for just $10, even less for a single piece. It was a sea change for the music industry, which took all the charms and manipulations of Jobs to succeed.

“Steve Jobs managed to win some mindshare in the record companies that were scared at the time,” Thomas said.

By mid-2004, iTunes offered more than one million songs, or just 1.5% of US music industry revenue, according to the Recording Industry Association of America (RIAA), but that was changing rapidly. The iPod line was growing, the iTunes Store was growing in popularity outside the United States, and traditional music stores – including the much-loved Tower Records – were collectively collapsing.


In 2012, only 39.9% of music industry revenue came from CDs and other physical media.

But Apple’s hold on the music business – based on “owning” digital copies of albums and songs – began to loosen after 2010, as subscription and streaming alternatives such as Spotify – not to mention Netflix and Amazon’s video services – have started to improve. the use of smartphones that Apple has made popular. “iTunes’ share of U.S. digital music sales fell from 69% to 63% as passionate music listeners turn to streaming services,”Bloomberg’s Andy Fixmer recently wrote.

iTunes and the Stream
“I think the idea of ​​buying music the way we have in the modern era – whether through CDs, cassettes or digital downloads – will diminish over the next few years,” he said. Crupnick said. “We’re going to see Apple evolve around this. On the 20th anniversary…we’ll be talking about [its] streaming services.”

“Nobody in the company has officially pitched it…but you hear about Apple’s interest in providing a radio format,” Thomas remarked, speculating – perhaps jokingly – that the service might be called “iRadio”.

While it fits industry gossip, “iRadio” clashes with how Jobs saw things. “He believed that people had an emotional connection to the songs they liked,” says Walter Isaacson in Jobs’ biography. “They wanted to own ‘Sympathy for the Devil’ and ‘Shelter from the Storm’, not just rent them.”

“I think you could make the second coming available in a subscription model and it might not be successful,” Isaacson said, quoting Jobs.

But the rumors do not go away. Perhaps news of an Apple subscription media service will arrive as early as June, when Apple hosts its annual Worldwide Developers Conference (WWDC).

“Could Apple crack the code? Crupnick wondered. “Maybe. Is it part music, part videos, part books? Will we have an entertainment subscription where we pay a certain amount per year and we get all the music, videos and books we want? Maybe.”

iTunes has killed the music store for the past decade, but Apple’s own retail operation could be in jeopardy if it doesn’t evolve over the next decade.

Want more tech news or interesting links? You’ll get plenty of both if you follow Rosa Golijan, the author of this post, by following her on Twittersubscribing to her Facebook postsor surrounding it on Google+.

Alice P. Darby