Ode To Market Dominance (10/12/04)
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Ruh-roh, Shaggy-- new challengers hoping to snag Apple's catbird seat in the digital music market are lining up to pounce every day, and if the pundits are right at all, the threats are becoming more and more credible. As faithful viewer Macintosah points out, the Associated Press reports that Virgin just debuted its own answer to the iPod mini, which is lighter, holds 25% more songs, and includes an FM tuner all for the same $249 that Apple charges. Meanwhile, Microsoft has just officially launched its own WMA-based music download service-- you know, that one that's been in "preview" mode for the past month. Between Virgin's feature set and brand recognition and Microsoft's built-in captive market of roughly 8 gazillion Wintel users, the barbarians are clearly at the gate; the question is, will they figure out how to open it?

We can't predict the future (our swami hats are at the cleaners), but we can at least tell you why we're not exactly panicking just yet: faithful viewer Philbert pointed out the fun little fact that, according to CNET, while last year Apple held a Jim-dandy 82.2 percent market share among sales of hard drive-based portable digital music players, the latest sales numbers show that the iPod now holds a staggering 92.1 percent share of the market. In other words, among all players that can store more than a few albums' worth of music (and there are a lot of 'em out there), Apple's got a positively Microsoftian slice of the pie. And it's growing.

So how's the "competition" dealing with this? Well, aside from whether or not their offerings stand a chance of mixing things up a little (Microsoft's efforts, in particular, will obviously change things eventually), right now their main strategy seems to be smack-talk. Quoth Virgin Electronics's CEO, "Apple is dominating, yes, but the market share that it has today is not going to last." Well, no, it won't; if the trend continues, next year it'll have, what-- 103% market share, something like that? As faithful viewer Jon Slaton points out, that presumably means that customers will be returning more Virgin Players than they originally purchased, which is a neat trick if you think about it.

Microsoft, meanwhile, is going straight for Doublespeak: according to CBS MarketWatch, the Redmond Giant actually said, "we're different because Apple is a closed system. If you want Apple, you have to use the iPod. A lot of people want choice and we offer that." (In other words, "you can have any color as long as it's black-- and the money goes in our pockets.") Interestingly, Apple decided not to explain that WMA isn't an "open" format, and instead, in its retort, went straight for the jugular with the market share numbers: "The iTunes Music Store, with its catalog of over 1 million songs, works with 65 percent of all MP3 players and 92 percent of all hard drive-based music players being sold today. There is a lot of customer choice happening today, it's just that Microsoft doesn't like the choices customers are making." Oooooo, burn!

Again, we're not saying there aren't real threats to Apple's dominance, but the company clearly has some real momentum and the critical mass necessary to keep it in first place for a good long while, provided it doesn't completely run out of gas. Let's put it this way: does anyone seriously think that people are going to eat bugs for a chance to win an MSN Music-compatible Virgin Player? Exactly.

 
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The above scene was taken from the 10/12/04 episode:

October 12, 2004: New challengers step up every day, but the iPod's market share among similar music players is a whopping 92 percent. Meanwhile, U2 lends its likeness and its new exclusive song to Apple's music marketing efforts, and we take a quick peek at some of the rumored Apple product intros floating around out there...

Other scenes from that episode:

  • 4973: U2: iTunes Bloody iTunes (10/12/04)   Speaking of the iTunes Music Store, did you happen to notice the new addition to the Music Videos section up there, as first pointed out to us by faithful viewer Mav? It seems that Bono, the Edge, and the other less colorfully-named members of the band U2 have all turned into 'Pod People; they're all silhouetted up (well, mostly-- you can still make out their faces) and jamming against brightly-colored solid backgrounds while their instruments and microphones trail very familiar-looking white cables and iPod-bearing dancers shake their groove thangs...

  • 4974: Mmm, New Stuff Potpourri (10/12/04)   Quick, it's time for a New Stuff Rumor Roundup! Not for any particular reason, you understand; it's just that, what with the three-day weekend and our late broadcasts and the heightened focus on music lately, we just figured it might be nice to take a quick glimpse at who says what's coming when before we flat-out forget that Apple makes these things called "Macs" as well as iPods...

Or view the entire episode as originally broadcast...

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