iTunes article and recent claims
iTunes is not dying.
Apparently, while I’ve been busy with my last days at Johns Hopkins before moving on to industry there have been a lot of talk of iTunes death and so on; one would think Wall Street has seen plenty of these to know better. Unfortunately, once again, all hell broke loose; convince yourself of this by going to Google news and searching for iTunes.
Fortunately there are some better articles out there; one of them was written by Charles Arthur of British newspaper the Guardian (the Manchester Guardian for the boomers out there) who came across my iTunes page. You can read the Guardian article here.
Having read his article as well as some of the initial pessimistic articles, I am going to write down my own two cents about this: I find the initial claim by Forrester Research that iTunes sales had dropped by a whoping 64% simply naive.
I made a point in late September 2006 of how Steve Jobs had announced in passing the 1.5 billion download mark had been reached, in the debut presentation of the iTunes Movie Store. I was particularly pleased by this announcement, because 1.5 Billion downloads was perfectly aligned to my 6 month old (at the time) model’s predictions.
Now, suppose the Jobs number is correct (could he be lying to us?) then to subsequently claim that sales dropped 64% in the months following January is absurd - we have numbers for the store up until late February when the 1 Billion mark was hit, and then, we have 6 months during which the store sold half as many songs as it sold in its entire lifetime! This fact suggests the ComScore figures (which suggest a rise of 67% in transactions) are closer to reality.
Note, that my numbers are not seasonally adjusted at all. When Apple releases milestones, which have been the sole basis of my model, they are absolute. With that said, seasonal spikes probably exist, as giftcards tend to be cashed after the holidays.
Can the kind of growth my charts show continue? Of course - claiming in 2006 that digital media have reached their peak is silly. The iTunes fate is bright, and the movie store will help accelerate this process.
Update: Guardian published a correction regarding the reversal of my name in the article shortly after I pointed out that Michael is in fact my surname.