These lawsuits culminated in Napster’s bankruptcy, and its purchase at the bankruptcy auction by Roxio (of CD burning fame) – who have converted it into a subscription streaming service. Users can pay GBP£5 a month for unlimited streams from Napster’s 8 million strong catalogue, plus 5 tracks to download and keep as MP3s. There’s also the option to buy download tracks on an a-la-carte basis once you’re subscribed. In addition to this, Napster also provides a free streaming site, with limited functionality, and access to three quarters of its catalogue. Users can’t make playlists from this site, and it’s a lot slower and harder to use than the subscription platform.

The subscription service is cheaper than Spotify Premium or eMusic, its closest competitors in terms of service, and the fact that all of Napster’s members are subscribers makes it’s income much more reliable than the advertising based model that still makes up the bulk of Spotify’s trading, (the Economist reported that only 40,000 of the 6 million users who had downloaded the free platform have subscribed to the premium service) and thus better able to provide a steady income to it’s contributing artists, were it not for the odd addition of it’s free streaming service to the mix. Napster’s operations seem a little confused, different elements pulling in different directions from one another; a steady income from the subscription service, with a clunky ad supported option detracting from it; a limited MP3 download service clashing with both and yet failing to make it easy for users to take music away from their PC’s. If they could centralise all of these elements into a neat platform and make it easy to use, they’d have a model that looked a bit like Spotify’s, but it’s yet to be seen whether that can be turned into a profitable business in the long term.

Related Articles

• Digital Music Store Focus – iTunes – October 14, 2009
• Digital Music Store Focus – Insound – October 12, 2009
• Digital Music Store Focus – iMesh – October 12, 2009
• The Self-Indulgent Friday Playlist – Girls, Boys, Alcohol and Dancing – October 9, 2009
• Digital Music Store Focus – HMV.com – October 9, 2009

Combined with the iPod, Apple’s online music store must be one of the biggest success stories on the net. They were surprisingly late on the scene; MP3’s were invented way back in 1991, eMusic’s first incarnation was born in 1998 , and the iTunes store didn’t go live until April 2003 (a year and a half after the iPod launched). Five years later, in April of ’08, iTunes overtook Wal-Mart to become the biggest music retailer in the USA, and was reported by Reuters as selling over 70% of all digital music worldwide. The IFPI calculated the global digital market as worth USD$3783.8 billion in 2008 – conflating these figures means the iTunes store turned over $2648.66 billion on music alone: by their own report, they sold 2 billion songs worldwide between January 15^th 2008 and January 6^th 2009 – OK, so the IFPI comparison gives them more than a dollar a track per sale, which isn’t the case, but the figures aren’t entirely disparate.

Here’s a breakdown (drawn from Apples published stats) of how music sales have accelerated for Apple over the last 6 and a bit years:

To save you the horror of another of my poorly structured Excel ’03 graphs – here’s one lifted from the very informative Wikipedia page that unfortunately only covers the trend up to 6billion tracks. (If anyone can recommend a better program for graphing, please tell me in the comments!)

The success of their online proposition has been underpinned by the massive success of the iPod – over 218 million units have now been sold, meaning that the average iPod owner would only need to have bought 40 tracks from the iTunes store to account for all sales. That’s less than 4 albums worth each, and I think I probably have a few hundred albums in my collection.

iPod Sales by Quarter

Unless you’re a pretty hardcore nerd, you’ll be forced to manage your iPod through iTunes, and that shop is just so conveniently placed within the same piece of software that it’s easy to see how those track sales figures come about. Even accounting for a decent percentage of hardware failures, obsolescences and droppings into a pint of beer for those iPods out there (yes, I have had all of these happen), the iTunes captive audience (don’t forget all those iMac and Macbook users) is still 150 million strong and buying hard.

Track prices are relatively high, with occasional offers and a regular set of free sample downloads from artists promoting themselves. Apple users don’t seem to mind this, and it translates into pretty good profitability for artists selling through iTunes, 65% of the revenue from each sale is piped on down to the provider of the tracks sold, and there’s no variability in per track income as with the ad-supported streaming services. RouteNote can get your music on itunes without you having to pay anything up front.

Related Articles

• Digital Music Store Focus – Napster 2.0 < – October 15, 2009
• Digital Music Store Focus – Insound – October 12, 2009
• Digital Music Store Focus – iMesh – October 12, 2009
• The Self-Indulgent Friday Playlist – Girls, Boys, Alcohol and Dancing – October 9, 2009
• Digital Music Store Focus – HMV.com – October 9, 2009

***EDIT***

Just to respond to that comment: a totally unfair comparison of someone who happened to be on Insound’s MP3 download front page when I looked, The Castanets, shows their album ‘Texas Rose…’ as being $1.50 cheaper on Amazon ($8.99) than on Insound ($10.49). Please feel free to refute me with your own research. I think Insound might deserve the extra money for taking an active interest in the bands they promote, and I hope they pass on more $ to their artists, but as a straight comparison, Amazon is cheaper (admittedly this is only one example).

Related Articles

• Digital Music Store Focus – Napster 2.0 < – October 15, 2009
• Digital Music Store Focus – iTunes – October 14, 2009
• Digital Music Store Focus – iMesh – October 12, 2009
• The Self-Indulgent Friday Playlist – Girls, Boys, Alcohol and Dancing – October 9, 2009
• Digital Music Store Focus – HMV.com – October 9, 2009

The music they offer up through their search is based on results from youtube, which streams quite smoothly in a little window on their GUI (the program window), and on the hard drives of the various iMesh users logged on at a given time (you all know how peer to peer works, right?). They have agreements with the RIAA (and thus the labels and artists listed with them) to pay royalties on streams and downloads, but they also have a vast amount of content that has not had copyright claimed. This doesn’t mean that copyright doesn’t exist in those tracks, just that the people the tracks belong to haven’t objected to their being used on iMesh’s service, which doesn’t seem particularly equitable if they don’t know its happening. RouteNote doesn’t currently do digital distribution to iMesh, but if you’re a user, you can put your own tracks in your iMesh folder to be shared. You won’t recieve any revenue thereby unless you’re registered with one of their partner mechanical copyright agencies like the RIAA or MCPS though.

Related Articles

• Digital Music Store Focus – Napster 2.0 < – October 15, 2009
• Digital Music Store Focus – iTunes – October 14, 2009
• Digital Music Store Focus – Insound – October 12, 2009
• The Self-Indulgent Friday Playlist – Girls, Boys, Alcohol and Dancing – October 9, 2009
• Digital Music Store Focus – HMV.com – October 9, 2009

Related Articles

• Digital Music Store Focus – Napster 2.0 < – October 15, 2009
• Digital Music Store Focus – iTunes – October 14, 2009
• Digital Music Store Focus – Insound – October 12, 2009
• Digital Music Store Focus – iMesh – October 12, 2009
• Digital Music Store Focus – HMV.com – October 9, 2009

HMV’s online store is an extension of their high street business, and as such caters mainly to the mainstream. The prices are high but the catalogue is pretty varied; they’ve got deals with all the majors, and they do carry a lot of offers that cheapen their products, two-for-one deals etc. Another plus is that they provide a one stop shop for digital, physical and merchandise products in a more coherent, music oriented way than Amazon do (unless you visit their subsidiary, Play.com). There’s no subscription option or anything, it’s just a nice simple version of their bricks and mortar operation without you having to traipse those weary miles to the town centre, or possibly wheel down there on your special fat guy scooter. RouteNote doesn’t currently distribute to HMV, but we can get you onto Amazon, who’ll make physical CD’s for you (soon).

Related Articles

• Digital Music Store Focus – Napster 2.0 < – October 15, 2009
• Digital Music Store Focus – iTunes – October 14, 2009
• Digital Music Store Focus – Insound – October 12, 2009
• Digital Music Store Focus – iMesh – October 12, 2009
• The Self-Indulgent Friday Playlist – Girls, Boys, Alcohol and Dancing – October 9, 2009

RouteNote can distribute your music to eMusic; artist revenues are based on dividing a proportion of their total subscription fees between the artists that were downloaded, 1 download equaling 1 share of the divided dinero. Subscription costs are variable, but in the UK you’re looking at somewhere under £10 for a month, which buys you 40 tracks (25p each for those who hate maths as much as me). eMusic will then take their share, and pass on a cut to the artist. Good for the consumer who’s prepared to commit to a monthly outlay, not necessarily as good for an independent artist, who is looking at significantly less per track income than on iTunes, but then there is more chance of an indie-loving audience hearing and buying your music, and more chance of getting exposure on an indie based blog than on one where you have to compete with artists from all the majors with a huge budget behind them.

Related Articles

• Digital Music Store Focus – Napster 2.0 < – October 15, 2009
• Digital Music Store Focus – iTunes – October 14, 2009
• Digital Music Store Focus – Insound – October 12, 2009
• Digital Music Store Focus – iMesh – October 12, 2009
• The Self-Indulgent Friday Playlist – Girls, Boys, Alcohol and Dancing – October 9, 2009

Related Articles

• Digital Music Store Focus – Napster 2.0 < – October 15, 2009
• Digital Music Store Focus – iTunes – October 14, 2009
• Digital Music Store Focus – Insound – October 12, 2009
• Digital Music Store Focus – iMesh – October 12, 2009
• The Self-Indulgent Friday Playlist – Girls, Boys, Alcohol and Dancing – October 9, 2009

Related Articles

• Digital Music Store Focus – Napster 2.0 < – October 15, 2009
• Digital Music Store Focus – iTunes – October 14, 2009
• Digital Music Store Focus – Insound – October 12, 2009
• Digital Music Store Focus – iMesh – October 12, 2009
• The Self-Indulgent Friday Playlist – Girls, Boys, Alcohol and Dancing – October 9, 2009

Related Articles

• Digital Music Store Focus – Napster 2.0 < – October 15, 2009
• Digital Music Store Focus – iTunes – October 14, 2009
• Digital Music Store Focus – Insound – October 12, 2009
• Digital Music Store Focus – iMesh – October 12, 2009
• The Self-Indulgent Friday Playlist – Girls, Boys, Alcohol and Dancing – October 9, 2009