Slash LaneApple Computer's industry leading iTunes digital download service has experienced a collapse in sales revenues this year according a recent analysis from Forrester Research.
The firm recently conducted an analysis of all related transactions over a 27-month period. And according to a write up over at The Register, this year's numbers are far from encouraging.
"While the iTunes service saw healthy growth for much of the period, since January the monthly revenue has fallen by 65 percent, with the average transaction size falling 17 percent," the report states. A rebound in sales that took place during the spring of 2005 wasn't repeated this year.
Meanwhile, data from Nielsen Soundscan indicates the problem is not Apple's alone, showing three consecutive quarters of flat or declining revenues for the digital download sector as a whole.
The Register notes that this ominous trend has manifested despite healthy growth for digital music players. During the same period monitored by Forrester, iPod sales quadrupled and Apple's grew digital download inventory on iTunes significantly as video and movie catalogs joined the plethora of digital music tracks.
According to Forrester's data on the purchasing trends of iTunes shoppers, some 3.2 percent of online households — around 60 percent of the wider population — bought at least one download during its sample period.
"These dabblers made on average 5.6 transactions, with the median household making just three a year," the report states. "The median transaction was slightly under $3."
Christine McKee
Malcolm Owen
Marko Zivkovic
Andrew Orr
Andrew O'Hara
William Gallagher
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120 Comments
Eck. I have purchased about 60 downloads from iTunes so far this year, closer to 100 I believe.
I have recently bought an annual subscription with their closest competitor eMusic.com, which I like, as they have VBR with slightly higher bit rate per song than iTunes 128 kbps norm.That and no DRM. In the two months that I have been with eMusic, I've downloaded almost as much as I've downloaded on iTunes this year.
Actually, I am one of those who actually still buys more CD's than downloads digital albums/songs. My iTunes collection is at 53 GB and I haven't uploaded the vast majority of my 1,000 music CD's.
DOWN WITH DRM! DOWN WITH DRM! DOWN WITH DRM! DOWN WITH DRM! DOWN WITH DRM!
I'm a long-time Apple fan and I actually want iTunes to succeed. However, I hate having my media, whether music, videos, etc. being locked up by DRM. I HATE DRM! And it's not because I want to share my files with everyone. I just don't think I should have to gain permission from some self-serving corporation before I can listen/watch the media I have purchased legally! AND I don't want to be told what device I can or can't play the music on. Since iTunes came online I've purchased maybe only a mere 20 songs, and I purchase them only when I'm in a bind and need the song RIGHT NOW. Otherwise I go buy the CD and rip it - in the format and bitrate of my choosing and WITHOUT DRM! Soooo... I say let's send Apple and the industry a message: FREE OUR MUSIC/MEDIA!
DOWN WITH DRM! DOWN WITH DRM! DOWN WITH DRM! DOWN WITH DRM! DOWN WITH DRM!
The problem is that in every category except convenience, CDs are superior. How successful would a campaign to replace DVDs with VHS be? Not very? Well how successful do they expect this to be then?
If Apple is only making pennies on this anyway, who cares? It's not like people aren't buying music anymore. It is still being purchased, ripped and played on an mp3 player. For as long as the iPod is the player of choice, Apple should be sufficiently pleased.
-Clive
And for the record, DOWN WITH DRM!
This is only from credit card data? I'm guessing that doesn't include iTunes gift cards? From my own observations, those have gone up a lot in popularity - kids are a big chunk of the people buying songs and movies, and parents don't want credit cards in their hands.