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Steve Jobs, music industry transformer

Steve Jobs, music industry transformer

By Agence France Presse | Updated: 6 June 2012 15:16 IST

Highlights

Steve Jobs, the late co-founder of Apple is also recognized as the man who revolutionized the music industry by dragging it into the digital world.

Steve Jobs, the late co-founder of Apple who pioneered personal computers, is also recognized as the man who revolutionized the music industry by dragging it into the digital world.

The visionary behind the Mac, the iPhone and the iPad also brought the iPod portable media player into the world, as well as the online store iTunes.

When Apple launched the iPod in 2001, MP3-formatted music had been available for several years, and manufacturers like SanDisk and Sony were selling digital music players.

But Sony "seemed to keep putting these barriers" up to protect its Sony Music, such as limiting the formats that could be played, said James McQuivey, an analyst at Forrester Research.

Meanwhile, "Apple was focused on letting the users get as much out of it as possible," he added.

Two years later, the iTunes music store, supported by the iPod's success, became the first to offer legal music downloads on a mass-market scale, selling individual songs for 99 cents, undercutting the market price for CDs.

That came out of tough negotiations with music distributors, who did not take kindly to the draconian conditions of single prices on single recordings.

"The Apple music biz took over the music business because it was so customer-centric," McQuivey said.

Eight years later, the music world, from artists to the recording industry, were pouring in tributes to Jobs, 56, who died Wednesday after a long battle with pancreatic cancer.

The Recording Industry Association of America praised Jobs in particular for countering music piracy and peer-to-peer file sharing, which deprived labels of any revenue.

"With the introduction of the iTunes software and other platforms, Steve and Apple made it once again easy and accepted to pay for music," RIAA chairman and chief executive Cary Sherman said.

"He was a true visionary who forever transformed how fans access and enjoy music."

According to RIAA numbers, the explosive growth in digital music has doubled the volume of music sales and slashed CD sales by more than a third between 2003 and 2010.

But digital music, including all its platforms, including iTunes, subscriber services and advertising-paid offers, continues to be less lucrative than CDs.

Digital sales channels accounted for 29 percent of global music industry revenues in 2010, the International Federation of the Phonographic Industry said earlier in the year.

The trend is upward; the digital share was 25 percent in 2009, according to the federation.

The digital share in the United States is roughly 50 percent, industry estimates suggest.

Meanwhile, although iTunes remains by far the biggest digital music distributor, according to Forrester Research, it has lost a bit of its dominance.

Music labels have learned how to navigate the digital world themselves, Forrester's McQuivey said.

Producers have more choice in negotiating with distributors competing with Apple, such as Amazon, and with websites and online radio stations such as Pandora and Spotify.

Another key development has been producers creating their own digital distribution channels with YouTube's free music video website Vevo.

Besides, McQuivey noted, Apple disappointed because "they haven't taken iTunes to the next level" and seemed to have missed the takeoff of the "social" revolution on the Internet.

"They make it very easy to buy and to listen to music, but... they haven't come up with a way to help you really share music -- to really learn from other people's music tastes," he said.

Whatever the reason, Apple has seen its popularity with music buyers slide.

Market research firm NPD said that in the United States, 75 percent of visitors to iTunes bought music, compared with 82 percent the previous year, as people increasingly snap up applications, including music applications.

Pandora's success is "largely attributable to the success of the iPhone and the iPad, because people who are iTunes customers want access to more music in more ways than iTunes gives them," McQuivey said.

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