Tech Industry
10/17/2003, 2:25am, EDT
Friday, October 17th[::FROM::] [::SiteName::]
Apple: iPods not iTMS is central to profits
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Apple said it doesn't have any illusions that it can make great profits from selling songs over the Internet: "Instead, Apple is counting on the store as a key part of an overall music business for the company that can produce substantial profits--mainly through sales of its iPod digital music player. 'The iPod makes money. The iTunes Music Store doesn't,' Apple Senior VP Phil Schiller told CNET News.com...Schiller said the music store is close to profitability but is still losing money. Apple doesn't see the business as having much long-term profit potential either."
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Too many businesses carry loss-leaders at this time, the net effect being that potential competitors do not enter the market due to artificially-inflated barriers of entry and reduced margin potential. Hopefully the coming years will bring in a more positive business climate for entreprenuers.
posted by MacNN.com Reader
posted by MacNN.com Reader
posted by MacNN.com Reader
posted by MacNN.com Reader
If it just breaks even, Apple will be THRILLED. The iTMS is NOT about profit, it's about pioneering an entirely new way to serve up music that will change the distribution channel for good. It's about empowering artists to take more control of their own careers, and eventually ending the concept of "record companies" as we know them today.
It's a PLATFORM. You know, guys, the Mac OS as a software title doesn't make any money either. Because that's *not what it's about.*
The company will make PLENTY on the recently-TRIPLED sales of the iPod, and people switching to Mac as a result of iTunes/iPod/iLife. Windows people are starting to have serious respect for Apple, often for the first time in their lives. Once you own an iPod, you start to "get" what the Mac fans are always on about: the elegance. The simplicity. The style. The caring and the quality. It makes you look again at owning a Mac.
That's Apple's plan. Now don't tell anyone. :)
posted by MacNN.com Reader
While that doesn't necessarily generate money for Apple, it broadens the installed base of Apple software, making it easier to expand services. iMovieStore, anyone?
posted by MacNN.com Reader
posted by MacNN.com Reader
posted by MacNN.com Reader
posted by MacNN.com Reader
posted by MacNN.com Reader