Over the past 2 weeks, we put the iTunes software through extensive testing to get a first-hand experience of using the iTunes store. However there were a few hurdles we first had to cross. While downloading apps from the App Store or subscribing to podcasts was extremely simple and convenient, those were the only features that were available to us from the iTunes store. Apple has yet to release the iTunes Music store and the iTunes TV/Movie store in Singapore.
Thus, in order to test out the features, we had to go a roundabout method, and purchase an iTunes gift voucher, which could be used to make purchases from the US iTunes store.
We hope that you enjoy reading our review of Apple's iTunes service.
Oct 14, 2008
iTunes: Introduction
The iTunes Store is an online digital media store operated by Apple Inc. Commencing its business activities as an online Music Store on April 28, 2003, it has altered the face of online music retail and has grown to be the number-one music store in the United States. As of 2008, sales figures have rocketed to a whopping 5 billion songs, accounting for more than 70% of the worldwide online music retain industry. Apple’s digital rights management (FairPlay) controls the use of downloads. Though most downloaded files are bound by restrictions, iTunes is undergoing a paradigm shift to selling DRM-free music. Apple iTunes Store was also the first online music store to gain widespread media attention. It allows users to purchase and transfer songs easily to the iPod through iTunes.
iTunes: Features
Pricing model & Special Highlights
Since the entry of the iTunes Store, most systems in place then charged a subscription fee. However, the iTunes Store penetrated the market by pricing individual songs for the same price, with no subscription fee. The pricing model has been relatively constant throughout several countries though in some places, song prices may vary depending on the various artists.
The songs from EMI and many indie labels are available without DRM and encoded at a higher quality rate. These versions, known as “iTunes Plus” commanded a premium price for a period of time, but have since returned to a flat-rate model. Previews (30seconds in length) are available for free, prior to buying a song. This enables potential buyers to learn more about the product they might be interested in, let alone entice the group of buyers who may not have displayed interest in the product at the very start.
Complete albums are also priced at a flat rate regardless of the number of songs or length of tracks on the album. Podcasts are free. Users of iTunes can access the iTunes Store via the application to subscribe to the podcasts of their choice without incurring any cost.
In addition, volume discounts of up to 20% for purchases in bulk (>25,000songs).
Apart from having a share in the online music retail industry, the iTunes Store also sells forms of other media such as movies, television productions, music videos, live concert footage etc. Movies tend to be priced below a DVD of the same film while television episodes are approximately double the cost of a song.
Finally, games created for some models of iPods are also available at various prices, but none as expensive as a feature length film. In addition, the iTunes Store now offers Apps, which are applications used for various purposes that are compatible with the new Apple products such as the iPod Touch and the iPhone. These Apps can also be categorized into “free apps” and “paid apps”.
During the 2008 Macworld keynote, Apple CEO Steve Jobs announced iTunes movie rentals. Movies available for rent in the iTunes Store 30 days after they have been released on DVD and are available at a lower rate. However, they are only accessible for 24 hours upon first view of the footage. This feature has yet to be introduced to all countries worldwide.
Weekly Promotions
The iTunes Store has a weekly promotion in which up to three songs are permitted for download without any charge, to logged-in users. Free downloads are available on Tuesdays, and remain so for 7 days. Some artists choose to have selected songs available for free.
Some iTunes television episodes have begun the same technique to encourage brand loyalty. The iTunes Store used to have a link to “free TV: on its home page which links to complete listing of free TV shows. However, it has disappeared. Apple still sells free TV episodes from channels such as ABC and NBC, with “Free Season Premieres”.
Purchase
To purchase files through the store, selected items must be paid with an iTunes gift card or a credit card with a billing address in specific countries. Apple also offers other payment methods such as Paypal, which differ from country to country.
Since the entry of the iTunes Store, most systems in place then charged a subscription fee. However, the iTunes Store penetrated the market by pricing individual songs for the same price, with no subscription fee. The pricing model has been relatively constant throughout several countries though in some places, song prices may vary depending on the various artists.
The songs from EMI and many indie labels are available without DRM and encoded at a higher quality rate. These versions, known as “iTunes Plus” commanded a premium price for a period of time, but have since returned to a flat-rate model. Previews (30seconds in length) are available for free, prior to buying a song. This enables potential buyers to learn more about the product they might be interested in, let alone entice the group of buyers who may not have displayed interest in the product at the very start.
Complete albums are also priced at a flat rate regardless of the number of songs or length of tracks on the album. Podcasts are free. Users of iTunes can access the iTunes Store via the application to subscribe to the podcasts of their choice without incurring any cost.
In addition, volume discounts of up to 20% for purchases in bulk (>25,000songs).
Apart from having a share in the online music retail industry, the iTunes Store also sells forms of other media such as movies, television productions, music videos, live concert footage etc. Movies tend to be priced below a DVD of the same film while television episodes are approximately double the cost of a song.
Finally, games created for some models of iPods are also available at various prices, but none as expensive as a feature length film. In addition, the iTunes Store now offers Apps, which are applications used for various purposes that are compatible with the new Apple products such as the iPod Touch and the iPhone. These Apps can also be categorized into “free apps” and “paid apps”.
During the 2008 Macworld keynote, Apple CEO Steve Jobs announced iTunes movie rentals. Movies available for rent in the iTunes Store 30 days after they have been released on DVD and are available at a lower rate. However, they are only accessible for 24 hours upon first view of the footage. This feature has yet to be introduced to all countries worldwide.
Weekly Promotions
The iTunes Store has a weekly promotion in which up to three songs are permitted for download without any charge, to logged-in users. Free downloads are available on Tuesdays, and remain so for 7 days. Some artists choose to have selected songs available for free.
Some iTunes television episodes have begun the same technique to encourage brand loyalty. The iTunes Store used to have a link to “free TV: on its home page which links to complete listing of free TV shows. However, it has disappeared. Apple still sells free TV episodes from channels such as ABC and NBC, with “Free Season Premieres”.
Purchase
To purchase files through the store, selected items must be paid with an iTunes gift card or a credit card with a billing address in specific countries. Apple also offers other payment methods such as Paypal, which differ from country to country.
iTunes: Business Model
The iTunes Store’s business model can be classified to be both B2C and B2B. While iTunes Store caters to consumer needs, it also provides a service to Business organizations for its employees. Various media such as podcasts can train employees in linguistic aspects or equip them with various new skills. More commonly, the iTunes Store partnership with Business organizations enable employees to have opportunities of leisure and relaxation.
With a business orientation of market penetration via internationalization and service differentiation, the iTunes Store plans to position itself highly competitively against existing systems in place. Apple’s FairPlay digital rights management (DRM) is integrated into iTunes, to ensure that there is a fair trade of media.
With a business orientation of market penetration via internationalization and service differentiation, the iTunes Store plans to position itself highly competitively against existing systems in place. Apple’s FairPlay digital rights management (DRM) is integrated into iTunes, to ensure that there is a fair trade of media.
iTunes: Specifications
Pricing Model
À la carte, fixed; limited time rentals available for certain video content
Platforms
Mac OS X, Windows 2000, Windows XP, Windows Server 2003, Windows Vista, Apple TV, iPod Touch, and iPhone
Formats
Protected AAC (.m4p) @ 128 kbit/s, audiobooks 32 kbit/s, Protected MPEG-4 Video (.m4v)
From May 2007 also Unprotected AAC (.m4a) @ 256 kbit/s (only selected content on "iTunes Plus")
Restrictions
Music - streaming to five computers every 24 hours, unlimited CDs (seven with an unchanged playlist), unlimited iPods and iPhones.
Catalogue
More than 8 million songs worldwide, 1,000,000+ podcasts (USA), 40,000+ music videos (USA),3,000+ TV shows (USA), 20,000+ audiobooks (USA), 33 iPod games (USA), 2,500+ movies (USA), 3000+ App Store Apps
Protocol
iTunes Music Store Protocol (itms://)
Features
Allowance, “Just For You”, Celebrity Playlists, gift certificates and gift cards, iMix, billboard charts, advanced search
À la carte, fixed; limited time rentals available for certain video content
Platforms
Mac OS X, Windows 2000, Windows XP, Windows Server 2003, Windows Vista, Apple TV, iPod Touch, and iPhone
Formats
Protected AAC (.m4p) @ 128 kbit/s, audiobooks 32 kbit/s, Protected MPEG-4 Video (.m4v)
From May 2007 also Unprotected AAC (.m4a) @ 256 kbit/s (only selected content on "iTunes Plus")
Restrictions
Music - streaming to five computers every 24 hours, unlimited CDs (seven with an unchanged playlist), unlimited iPods and iPhones.
Catalogue
More than 8 million songs worldwide, 1,000,000+ podcasts (USA), 40,000+ music videos (USA),3,000+ TV shows (USA), 20,000+ audiobooks (USA), 33 iPod games (USA), 2,500+ movies (USA), 3000+ App Store Apps
Protocol
iTunes Music Store Protocol (itms://)
Features
Allowance, “Just For You”, Celebrity Playlists, gift certificates and gift cards, iMix, billboard charts, advanced search
iTunes: Design
The Apple iTunes store is only accessible via their iTunes Player for MacOS and Windows XP/Vista.
The design is rather functional and convenient. The store is divided into 3 categories, with 10 sections, namely: Audio (Music, Audiobooks, Audio Podcasts ) Video (Movies, TV Shows, Music Videos, Video Podcasts), and Applications (iPod Games, App Store), and with iTunes U and iTunes Latino both having video and audio downloads.
Audio Layout
The layout of the store’s different sections are similar, offering a plethora of views to segment the massive store into smaller more concise categories. Besides searching for audio via the standard genres and categories, the iTunes store has a couple of subsections on the page, such as ‘Top Albums’, ‘Staff’s Pick’s’, ‘In The Spotlight’, ‘What’s Hot’, etc. Customers can also browse albums via Coverflow. All these options not only help the consumers make their purchase decisions easier, but serve as a platform from which artists can help listeners discover their music.
Video Layout
.jpg)
In conclusion, the design of the iTunes store is very functional, and comprehensive, giving customers what they need, which is choices, choices and more choices.
iTunes: Strength
The strength of the iTunes store, is the closed system that Apple has created. By closed system, we refer to the way Apple’s products, be it software or hardware, are tightly controlled, and that Apple decides how the consumers should use the products. Like it or hate it, this business ecosystem that Apple has created for its products has stood the test of time, and has proven a wildly successful business model.
For example, Apple only supports audio and video synchronization for their iPods through the use of the iTunes media player. Through the iTunes player, Apple is able to provide various extra services through the iTunes store. On the hardware front, music downloaded via iTunes has limited portable player compatibility – meaning to say that they are only playable on iPods and other Apple products. By doing this, Apple created a situation which would dissuade customers from switching brands of music hardware, so as not to make the music collection that they purchased from iTunes, obsolete.
Purchasing a song or video is extremely simple and convenient, and this is one of the stronger incentives to purchase media from the iTunes store. The system also recently allowed for music, movies, and apps to be purchased directly from the Apple iPhone, and iPod Touch as long as there is a wifi connection, without the need to be connected to a PC. This relentless pursuit of providing convenience to the consumer has won over masses, and has made the iTunes store, the leader in digital sales of music and other media.
Of course, Apple not only has to please the final customers, but their partners as well. Piracy of digital media is of course a main concern of any music label, TV network, or movie production house, and Apple has excelled in gaining their trust, albeit through the use of controversial DRM(Digital Rights Management), and thus has the largest online catalogue of music and TV shows in the world. By pricing the media competitively, coupled with the ease of transaction, it has in fact provided people with an incentive for going legit.
For example, Apple only supports audio and video synchronization for their iPods through the use of the iTunes media player. Through the iTunes player, Apple is able to provide various extra services through the iTunes store. On the hardware front, music downloaded via iTunes has limited portable player compatibility – meaning to say that they are only playable on iPods and other Apple products. By doing this, Apple created a situation which would dissuade customers from switching brands of music hardware, so as not to make the music collection that they purchased from iTunes, obsolete.
Purchasing a song or video is extremely simple and convenient, and this is one of the stronger incentives to purchase media from the iTunes store. The system also recently allowed for music, movies, and apps to be purchased directly from the Apple iPhone, and iPod Touch as long as there is a wifi connection, without the need to be connected to a PC. This relentless pursuit of providing convenience to the consumer has won over masses, and has made the iTunes store, the leader in digital sales of music and other media.
Of course, Apple not only has to please the final customers, but their partners as well. Piracy of digital media is of course a main concern of any music label, TV network, or movie production house, and Apple has excelled in gaining their trust, albeit through the use of controversial DRM(Digital Rights Management), and thus has the largest online catalogue of music and TV shows in the world. By pricing the media competitively, coupled with the ease of transaction, it has in fact provided people with an incentive for going legit.
iTunes: Weakness
The strength of Apple’s business model, is also its weakness. It is a double edged sword to make the iTunes store so insular.
While Apple’s share of the portable media player pie is the largest at 70%, it would be arrogant of them to block out a whole portion of the market who use other brands of MP3 players, etc, from making a purchase from iTunes. While good sales stemming from Apple’s tactic of trying to entice people to get an iPod and be part of the whole experience that is iTunes, that does not necessarily translate into customer satisfaction. Many customers don’t have a choice in the matter as changing brands would mean that they wasted hundreds if not thousands of dollars on a music collection that cannot be heard on their new player.
The issue of DRM is another weakness of the iTunes store that has to be rectified. While many other online stores use the fact that they provide music DRM-free as an incentive for people to purchase from their stores instead, Apple is still stubbornly providing only DRM laced media on its site. Its draconian restrictions are infamous. In addition to the above mentioned iPod-only policy, the DRM restricts the buyer from making multiple backups of the same songs (limited to 5 different computers), restricts the conversion of the songs to other formats (such as the space saving WMA or OGG formats – only Apple AAC format supported), and also does not allow you to edit, excerpt, or otherwise sample songs. So basically, while you’re paying full price for a song, you’re actually not really owning the song. Apple still owns it and controls how you interact with your own music.
Things are not much different on the video front as well, as evidenced on the DRM that’s attached with movie rentals. Apple movie rentals are stored on the computer for 30 days. Once started viewing, you can watch the episode as many times as you want before it expires within 24 hours. After either deadline is reached, the file is automatically deleted from your computer, and you have no way of extending the rental other than renting it again.
The heavy handed methods which Apple uses to clamp down on piracy has backfired on them in some aspects – it is not hard to find a blog or forum denouncing Apple’s business tactics.
The quality of music sold through iTunes is another issue that many customers are unhappy about. Majority of all music sold through iTunes are encoded at a lacklustre 128 bitrate, which is half the audio fidelity of music found on a CD. Customers have no option to download higher bitrates of tracks they’ve bought.
Previously, we’ve mentioned about the design of the store, and the many different ways to view the items within the store. While we like the choice presented to the customer, it is in our opinion that the store has a tendency to look quite cluttered and messy. Perhaps allowing the customer to customize the layout of the store, much like what Google has done to let users customize their search page through iGoogle, and save their settings, would help in reducing the clutter.
While Apple’s share of the portable media player pie is the largest at 70%, it would be arrogant of them to block out a whole portion of the market who use other brands of MP3 players, etc, from making a purchase from iTunes. While good sales stemming from Apple’s tactic of trying to entice people to get an iPod and be part of the whole experience that is iTunes, that does not necessarily translate into customer satisfaction. Many customers don’t have a choice in the matter as changing brands would mean that they wasted hundreds if not thousands of dollars on a music collection that cannot be heard on their new player.
The issue of DRM is another weakness of the iTunes store that has to be rectified. While many other online stores use the fact that they provide music DRM-free as an incentive for people to purchase from their stores instead, Apple is still stubbornly providing only DRM laced media on its site. Its draconian restrictions are infamous. In addition to the above mentioned iPod-only policy, the DRM restricts the buyer from making multiple backups of the same songs (limited to 5 different computers), restricts the conversion of the songs to other formats (such as the space saving WMA or OGG formats – only Apple AAC format supported), and also does not allow you to edit, excerpt, or otherwise sample songs. So basically, while you’re paying full price for a song, you’re actually not really owning the song. Apple still owns it and controls how you interact with your own music.
Things are not much different on the video front as well, as evidenced on the DRM that’s attached with movie rentals. Apple movie rentals are stored on the computer for 30 days. Once started viewing, you can watch the episode as many times as you want before it expires within 24 hours. After either deadline is reached, the file is automatically deleted from your computer, and you have no way of extending the rental other than renting it again.
The heavy handed methods which Apple uses to clamp down on piracy has backfired on them in some aspects – it is not hard to find a blog or forum denouncing Apple’s business tactics.
The quality of music sold through iTunes is another issue that many customers are unhappy about. Majority of all music sold through iTunes are encoded at a lacklustre 128 bitrate, which is half the audio fidelity of music found on a CD. Customers have no option to download higher bitrates of tracks they’ve bought.
Previously, we’ve mentioned about the design of the store, and the many different ways to view the items within the store. While we like the choice presented to the customer, it is in our opinion that the store has a tendency to look quite cluttered and messy. Perhaps allowing the customer to customize the layout of the store, much like what Google has done to let users customize their search page through iGoogle, and save their settings, would help in reducing the clutter.
iTunes: Afterthoughts
In conclusion, Apple’s business model of creating an entire ecosystem surrounding their products is an ingenious one. The ease of use, the range of media available at the iTunes store, all make for a very pleasant experience. However, it would do Apple good to consider listening to the complaints of its customers, and perhaps reducing the barrier to using iTunes, so that it can tap even more customers.
Subscribe to:
Posts (Atom)
