How Apple accidentally destroyed the record business — and why I wish we’d stuck with iPods | Daily Reports Online
50 years of Apple
We’re celebrating Apple’s 50th birthday with a week of content about the tech giant. It covers everything from personal recollections from our writers to the greatest — and worst — Apple gadgets as voted by you, and you can read it all on our 50 years of Apple page.
In 2001, Apple completely changed music with three products: Macs with built-in SuperDrive CD burners; the iTunes music app; and the iPod. We didn’t know it at the time, but those three products lit a fuse that would burn down the record business.
Apple didn’t invent the CD drive for computers; that was Philips. It didn’t invent iTunes; it bought the SoundJam MP app, simplified it and rebranded it. And it didn’t invent the digital music player; that was Kane Kramer’s IXI two decades previously.
But what Apple did was what Apple does so well. It learned from other people’s mistakes and then marketed its own products perfectly.
1,000 songs in your pocket.
It’s your music: burn it on a Mac.
Rip. Mix. Burn.
Her name is Rio and she transfers music slow
Before Apple launched its 2001 trio, you could rip CDs to digital, you could burn digital files onto CD-Rs and you could copy digital files onto MP3 players. But as someone who was doing all of those things at the time on PCs, I promise you: it was an enormous pain. CD burning was flaky, the apps were horrible and MP3 players’ interfaces were generally horrendous.
Apple solved all of those things, making it easy to rip your CDs, burn new compilations and transfer songs to your iPod. And they timed it just right.
I miss Apple’s magical music machines… what’s replaced them doesn’t always feel like an upgrade.
The music business isn’t a big fan of machines that can make perfect copies of music without payment or permission, which is why very few of us in the 1980s bought a DAT (Digital Audio Tape) recorder. The Recording Industry Association of America tried to get consumer DAT machines banned, and while that failed it did succeed in getting mandatory copy protection and a tax on digital recorders that made DATs too limited and pricey for most of us.
But there were no such restrictions or taxes on CD drives, and when the RIAA tried to get the popular Diamond Rio range of MP3 players banned in 1999 a US district court said no. Sales of the Rio skyrocketed, and Steve Jobs saw an Apple-shaped opportunity to enter and take over what was clearly going to be a huge market.
How Apple called the tune
The Rio was the first commercially successful MP3 player, but like other players of the era it was very limited.
The first model, the PMP300, was shoddily built and could only store about half an hour of low-quality 128kbps MP3 music transferred over a glacially slow USB 1.0 connection. Rival devices from the likes of Creative and Archos were better, but I reviewed quite a few players at the time and none of them were jaw-droppingly impressive and easy to use like the first-gen iPod was. Even the usually reliable Sony missed the mark, pushing for its own proprietary ATRAC format instead of the much more popular MP3.
The music business isn’t a big fan of machines that can make perfect copies of music without payment or permission.
One of the things that set the iPod apart was that “1,000 songs in your pocket” at a time where getting a dozen decent-sounding tracks onto a device was considered a win. That was made possible by Toshiba, who had just invented a tiny 5GB hard disk that made the solid-state and memory card-based MP3 players’ capacities look pathetic. Apple being Apple, it signed an exclusive deal for the drives that meant nobody else could buy them.
There was another key player in Apple’s success, albeit unofficially: Napster. Launched in 1999 the file-sharing network made global music piracy laughably easy and incredibly popular, and it peaked in 2001 with 26.4 million users. Many of those users were downloading music others had ripped in order to mix and burn them on Macs or listen to them on iPods.
Setting up shop
The record business initially saw Apple as a threat, and it was not amused at all by “Rip. Mix. Burn.” But while Apple no doubt benefited from people doing dodgy music downloading, it soon decided to offer an alternative. That would make it an industry ally and would also make it a big pile of money.
2003’s iTunes Store brought iTunes convenience to music purchasing, and while there was some industry pushback against Apple’s $0.99 per song pricing (and significant cut of each sale) pragmatism soon prevailed as execs realized that it was better to get anything from Apple than nothing from Napster.
Pragmatism soon prevailed as execs realized that it was better to get anything from Apple than nothing from Napster.
The music business had tried its own digital music services, but because the labels wouldn’t work with each other to create a one-stop shop, it ended up creating a half-arsed offer of competing, incomplete catalogs. Universal and Sony joined forces to create one service, Pressplay, and Warners, BMG and EMI created another, Musicnet. Pressplay went for Microsoft tech and Musicnet went for Real Networks and we all went to iTunes. Or Napster and its many imitators.
What kept law-abiding people going back to Apple wasn’t style or simplicity. It was that the big record labels wanted to rent you music – including music you might already own on CD – rather than sell it, and they wanted to do so in an overly complex and miserly way.
As Billboard magazine noted Musicnet charged $9.95 per month for 100 temporary downloads and 100 on-demand streams. Downloads needed to check in with Musicnet every month to keep working, tracks couldn’t be moved to other devices and content was limited to the catalogs of WMG, BMG, EMI and Zomba. Meanwhile, over at Pressplay, you’d also pay $9.95 but this time you’d get a third of the downloads and three times the on-demand streams with CD burning as a pricey additional extra.
It’s hardly “Rip. Mix. Burn.” And in 2003 the iTunes Store made them both redundant.
Hey! Ho! Let’s go (back)!
Apple dominated digital music throughout the 2000s in part because it made so many beautiful players.
Between me and my kids I’ve owned pretty much every one of them including the iPod 3G, iPod 4G, iPod nano, iPod shuffle, iPod mini, Video iPod, 80GB iPod, iPod touch, iPod classic, iPod Product (RED)… all the way to the very final iPod touch, which was an excellent way to keep the kids happy on long trips while my iPod Classic supplied the in-car soundtrack via an FM adapter.
From 2007 onwards it became obvious that the iPod was on its way out, soon to be swallowed up by the Very Hungry iPhone that also consumed my compact cameras, my PDAs, my Blackberry and my Walkman phone. And purchased digital downloads started declining too, with Spotify (founded in 2006) and other streaming doing to iTunes sales what the iPod did to the Diamond Rio and Creative Nomad.
I miss Apple’s magical music machines. Partly because they were brilliant and fun and life-enhancing and just beautifully designed little treasures (with the exception of third-gen shuffle, which I like to pretend never happened) and partly because what’s replaced them doesn’t always feel like an upgrade. Nobody cooked their brains on an iPod Classic or became a Nazi on an iPod nano like so many people seem to be doing on smartphones.
And it turns out there were some unexpected consequences of the end of mass-market physical media, such as our ability to afford vinyl record reissues and the terrifying cost of today’s concert tickets.
The switch from selling CDs to streaming effectively killed off a huge chunk of many artists’ income and they’ve changed tactics to compensate, which is partly why vinyl now costs $60, a tour hoodie is $95, it’s $25 to park outside the concert and your ticket cost the same as sending two kids to college.
That’s the thing about lighting fuses. Sometimes fires spread.
