Apple’s Digital Music Foray

Music is a universal attractor. That simple fact is what has perhaps prompted Steve Jobs to lead into creating the iTunes Music Store. Fortune writes:

The iTunes Music Store is as simple and straightforward as anything Jobs has ever produced. Apple users get to the store by clicking a button on the iTunes 4 jukebox, available for download when the service made its debut on April 28. You can listen to a 30-second preview of any song and then, with one click, buy a high-quality audio copy for 99 cents. There’s no monthly subscription fee, and consumers have virtually unfettered ownership of the music they download.

If the iTunes Music Store or something like it takes off, that could change how new music is released, marketed, and promoted. Until recently the chief fear in the music industry about letting people buy individual songs via the Internet was that it would kill the album by enabling consumers to cherry-pick their favorite tracks. Music company executives now bravely say that a singles-based business might actually revive sales.

The Music Store is his latest effort to diversify Apple’s sources of revenue beyond Macs. With Apple’s share of the desktop computer market stuck at less than 5% in the U.S. and less than 3% worldwide for several years, the iPod is the most obvious new line of business, steering Apple onto the home turf of consumer-electronics giants like Sony and Matsushita. Now Apple makes almost as much operating profit on each iPod it sells as it does on each iMac, even though the iPod costs a fraction as much to manufacture. So it should come as no surprise that Jobs is releasing three new versions of the iPod in conjunction with the Music Store.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.