End of the Apple iPod fad?

Colin Dunstan · 06-04-2005, 09:29 AM

By now Apple has sold more than 10 million iPod MP3 players, and the company's stock has surged 270 percent since the iPod was first introduced in October 2001. But these days analysts are wary of the player's future success.

An AP article appearing at BusinessWeek online yesterday reports that unlike in the past, when Apple has always shipped more iPods to retailers than expected, Goldman Sachs analysts now predict that Apple would likely only meet expectations and iPod shipments to be flat this quarter. The AP article is also quoting an AppleInsider report saying that shipments of most iPod models are "flat or declining" for the first time since the device was launched in 2001 and that, as a consequence Apple is overstocked on most of its MP3 players.

After these news Apple stock fell $1.80, or 4.5 percent to close at $38.24 last Friday.

gadgetguru · 06-04-2005, 01:09 PM

There's a limit to anything that becomes so big, so fast. Palm learned the hard way when demand for it's PDA plummeted after many years of growth. The music player is bigger and the slowdown might not be as drastic, but it will happen...question is when...unless Apple could feed the fire....again and again...it seem the fire is ebbing now, so does Apple has a log to feed the fire, we'll know next week at their devcon.

Chaos · 06-04-2005, 01:29 PM

After selling 10 million, how many of those people really want another one? I have a 3G iPod from Christmas in 2003, and it still works perfectly, and I'm nowhere close to running out of space.

So until it either dies, or I get too much music, I keep it.

Alexander Turcic · 06-04-2005, 01:56 PM

You know Apple has becan its iPod recycle program just in time for you to turn in your old iPod and buy a new one and thus make Apple shareholders happy

rlauzon · 06-04-2005, 06:30 PM

Also the anti-DRM is kicking in. As people get mad at their poor battery life and Apple's non-response to it, they are finding that DRM locks them into a single vendor - and they don't like it.

Pride Of Lions · 06-04-2005, 10:34 PM

I think that the exponential growth curve of the iPod has reached it's saturation point. We have to remember that,

1) Most people who want a hard-drive music player, want an iPod.
2) Most people who want an iPod have one by now.
3) The digital divide is very real and there's a striking disparity between the geeky (who get geekier) and the normal people (who are further removed as technology advances.)
4) Apple has hit such a home run with the a la carte music downloading service. People have really responded to being able to choose which songs they buy instead of having unlikable songs hoisted upon them.

I think that the only way for Apple to jumpstart this stagnation would be to appeal to the iPod owner who wants more innovation from their player (more storage space (80GB for me!), video player, phone (or something),...) and I'm not sure that Apple has anything like that up their sleeve.

I am a "Mac guy", but I'm not a super-fanboy. I like how Apple has created the demand for the player, created a wide spectrum of players for each price-point and want/need, given the masses an easy way to buy music online, and an entry to their computer division (should the people need a computer to hook up to their iPod or buy music online), and grudgingly admitted and rectified the battery issues.

Most of Apple's decisions have rippled the entire computer market and now several companies are playing catch-up and struggling to offer more desirable features at a lower price.

Apple's not the only company to offer DRM, but I do agree with you rlauzon, that the masses are unaccustomed to DRM and what it means or how to avoid/overcome it. I'm bothered by Sony's Connect music store and their player's ATRAC3 format (even though they've allowed MP3's lately) and especially bothered by Napster's misrepresentation of what their store offers (renting vs. buying music) and it's advantages over Apple's iTunes Music Store, but those are just examples of these companies fighting for a share of Apple's massive market share.

The geeky getting geekier, DRM doesn't affect them like it does the normal person. Everytime there's a digital obstacle, there are geeks worldwide fighting to overcome it. Whether it's burning a CD to remove the DRM, or recording the streaming music from the sound card or whatever, geeks are well equipped to handle any challenge.

I think that Apple will contemplate the market and make a decision on how to proceed, but the next untapped market is the non-computer user and getting computers on their desks and allowing them to join this emerging technology.
POL9A

Chaos · 06-05-2005, 03:13 AM

Personally I haven't even bought a single bit of DRM'd music. Ever. I have a $30 Canadian gift certificate for the iTMS sitting tacked to my wall, unused. I might use it some time, but I find that anything I like (anime soundtracks make up a fair bit of the music I have) cannot be found at online music stores, or even in normal music stores on CDs.

So all the music I have is non-DRM'd, making the DRM point hold no value to me. I don't think I'm the only one like this.

There are only two reasons I can see, relating to music format, that one could have for not being able to, or not wanting to, use an iPod. One - already owning other DRM'd music, not playable on an iPod. Two - not using MP3s, or M4As, and instead using OGGs, or FLAC.

I find the battery life on my iPod is quite acceptable. It holds out from when I leave, until, usually, an hour after getting back home, with fairly heavy usage throughout the day (5-6 hours, on average). So, for an over-year-old iPod, that's around 7-8 hours. I simply throw it into the dock overnight, and be done with it. Supposedly the 4G iPods are better on the battery life.

Mind you, I turn off the clicker sound and the backlight, which are on by default on the 3Gs.

06-04-2005, 09:29 AM	#1
Colin Dunstan Is papyrophobic! Posts: 1,926 Karma: 1009999 Join Date: Aug 2003 Location: USA Device: Dell Axim	End of the Apple iPod fad? By now Apple has sold more than 10 million iPod MP3 players, and the company's stock has surged 270 percent since the iPod was first introduced in October 2001. But these days analysts are wary of the player's future success. An AP article appearing at BusinessWeek online yesterday reports that unlike in the past, when Apple has always shipped more iPods to retailers than expected, Goldman Sachs analysts now predict that Apple would likely only meet expectations and iPod shipments to be flat this quarter. The AP article is also quoting an AppleInsider report saying that shipments of most iPod models are "flat or declining" for the first time since the device was launched in 2001 and that, as a consequence Apple is overstocked on most of its MP3 players. After these news Apple stock fell $1.80, or 4.5 percent to close at $38.24 last Friday.

06-04-2005, 10:34 PM	#6
Pride Of Lions just kinda geeky Posts: 381 Karma: 30 Join Date: Apr 2003 Location: Oakland, California Device: iPhone	I think that the exponential growth curve of the iPod has reached it's saturation point. We have to remember that, 1) Most people who want a hard-drive music player, want an iPod. 2) Most people who want an iPod have one by now. 3) The digital divide is very real and there's a striking disparity between the geeky (who get geekier) and the normal people (who are further removed as technology advances.) 4) Apple has hit such a home run with the a la carte music downloading service. People have really responded to being able to choose which songs they buy instead of having unlikable songs hoisted upon them. I think that the only way for Apple to jumpstart this stagnation would be to appeal to the iPod owner who wants more innovation from their player (more storage space (80GB for me!), video player, phone (or something),...) and I'm not sure that Apple has anything like that up their sleeve. I am a "Mac guy", but I'm not a super-fanboy. I like how Apple has created the demand for the player, created a wide spectrum of players for each price-point and want/need, given the masses an easy way to buy music online, and an entry to their computer division (should the people need a computer to hook up to their iPod or buy music online), and grudgingly admitted and rectified the battery issues. Most of Apple's decisions have rippled the entire computer market and now several companies are playing catch-up and struggling to offer more desirable features at a lower price. Apple's not the only company to offer DRM, but I do agree with you rlauzon, that the masses are unaccustomed to DRM and what it means or how to avoid/overcome it. I'm bothered by Sony's Connect music store and their player's ATRAC3 format (even though they've allowed MP3's lately) and especially bothered by Napster's misrepresentation of what their store offers (renting vs. buying music) and it's advantages over Apple's iTunes Music Store, but those are just examples of these companies fighting for a share of Apple's massive market share. The geeky getting geekier, DRM doesn't affect them like it does the normal person. Everytime there's a digital obstacle, there are geeks worldwide fighting to overcome it. Whether it's burning a CD to remove the DRM, or recording the streaming music from the sound card or whatever, geeks are well equipped to handle any challenge. I think that Apple will contemplate the market and make a decision on how to proceed, but the next untapped market is the non-computer user and getting computers on their desks and allowing them to join this emerging technology. POL9A Last edited by Pride Of Lions; 06-04-2005 at 10:38 PM. Reason: Spelling, damn laptop keyboard!

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06-04-2005, 01:09 PM	#2
gadgetguru Addict Posts: 214 Karma: 6370 Join Date: May 2003 Location: Asia Device: Tungsten T5	There's a limit to anything that becomes so big, so fast. Palm learned the hard way when demand for it's PDA plummeted after many years of growth. The music player is bigger and the slowdown might not be as drastic, but it will happen...question is when...unless Apple could feed the fire....again and again...it seem the fire is ebbing now, so does Apple has a log to feed the fire, we'll know next week at their devcon.

06-04-2005, 01:29 PM	#3
Chaos Evangelist Posts: 418 Karma: 281 Join Date: Jul 2004 Location: Canada Device: Assorted older devices	After selling 10 million, how many of those people really want another one? I have a 3G iPod from Christmas in 2003, and it still works perfectly, and I'm nowhere close to running out of space. So until it either dies, or I get too much music, I keep it.

06-04-2005, 01:56 PM	#4
Alexander Turcic Fully Converged Posts: 18,163 Karma: 14021202 Join Date: Oct 2002 Location: Switzerland Device: Too many to count here.	You know Apple has becan its iPod recycle program just in time for you to turn in your old iPod and buy a new one and thus make Apple shareholders happy

06-04-2005, 06:30 PM	#5
rlauzon Wizard Posts: 1,018 Karma: 67827 Join Date: Jan 2005 Device: PocketBook Era	Also the anti-DRM is kicking in. As people get mad at their poor battery life and Apple's non-response to it, they are finding that DRM locks them into a single vendor - and they don't like it.

06-05-2005, 03:13 AM	#7
Chaos Evangelist Posts: 418 Karma: 281 Join Date: Jul 2004 Location: Canada Device: Assorted older devices	Personally I haven't even bought a single bit of DRM'd music. Ever. I have a $30 Canadian gift certificate for the iTMS sitting tacked to my wall, unused. I might use it some time, but I find that anything I like (anime soundtracks make up a fair bit of the music I have) cannot be found at online music stores, or even in normal music stores on CDs. So all the music I have is non-DRM'd, making the DRM point hold no value to me. I don't think I'm the only one like this. There are only two reasons I can see, relating to music format, that one could have for not being able to, or not wanting to, use an iPod. One - already owning other DRM'd music, not playable on an iPod. Two - not using MP3s, or M4As, and instead using OGGs, or FLAC. I find the battery life on my iPod is quite acceptable. It holds out from when I leave, until, usually, an hour after getting back home, with fairly heavy usage throughout the day (5-6 hours, on average). So, for an over-year-old iPod, that's around 7-8 hours. I simply throw it into the dock overnight, and be done with it. Supposedly the 4G iPods are better on the battery life. Mind you, I turn off the clicker sound and the backlight, which are on by default on the 3Gs.