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Old 12-29-2012, 03:26 AM   #32
Top100EbooksRank
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Posts: 304
Karma: 6102528
Join Date: Mar 2012
Device: Kindle
Quote:
Some perspective: It takes Apple (the entire company, not iTunes) about 2 days to generate $600 million in revenues, and with a profit margin of 22%, less than 3 hours to generate $5 million in profits.

After 10 years, Rhapsody was stuck in the 600,000-user range, and squeaked into 1 million users earlier this year because of the Napster merger. They're not getting to 5 million any time soon.

This isn't a zero-sum game, where a subscription to Pandora stops people from purchasing music. I.e. it's going to take a lot more than a half dozen services collecting 30 million paying subscribers to truly challenge Apple's position.
Subscription music won't challenge Apple position since Itunes music is only a very tiny part of Apple business. And subscription and download and physical CD will continue to co-exist in many years to come.

I'm just saying 30 million paying subscribers will generate about as much money for the music industry as Itunes does. 30 million paying subscribers will generate $3.6 billion USD. Itunes worldwide sales for music is around that mark right now.

Subscription music is increasing at a very high rate.
Downloading music is increasing at a slow rate. At some point, the two line will cross. It could be as early as 4-5 years from now.

Last edited by Top100EbooksRank; 12-29-2012 at 03:29 AM.
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