Napster’s making deals with beer companies. How low will Steve Jobs go to keep iTunes on top? | iLounge News

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Napster’s making deals with beer companies. How low will Steve Jobs go to keep iTunes on top?

You know, it seems like only yesterday that I pointed out that all (both) of the players in the soft drink space were spoken for when it came to digital music. In fact, it was yesterday. The good folks at Roxio must have been reading my article, and realized that they were in a bit of a pinch now that both Coke and Pepsi sponsorships were off limits, because they’ve moved on to other beverages in search of sponsorships, and no I’m not talking about Fresca. In what may amount to a new all-time low for the high-tech industry, the brains behind the Napster mini-revival have signed up a beer company as their new sponsor. Yeah, you read that right…

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Comments

1

It might be considered by Americans as the lowest Napster could go… but if I had one good advice for iTunes MS Europe, then it would exactly be that. Find yourself a decent national brewer in every country (avoid Heineken) because overhere, Coke or Pepsi won’t cut it. There’s a reason why all the big music festivals targeting the youth (age 15 and up) in Europe are sponsored by beer companies. It’s a different attitude.

Posted by Fred on December 11, 2003 at 12:11 AM (PDT)

2

Isn’t Fresca a Coca-Cola beverage?

Posted by fakepope on December 11, 2003 at 12:21 AM (PDT)

3

When I first read the headline I thought it made sense. It really doesn’t though. They are going for this ‘edgier’ image that I think some people might like, but not a lot of people.

Posted by Jon in Seattle, WA on December 11, 2003 at 12:48 AM (PDT)

4

Here we really are getting into cross-cultural attitudes. Comparing beer to crack would make you a laughing stock in the UK, while in the USA, within living memory, they have had prohibition.

Over here, Beer sponsorship would be regarded as cool and entirely uncontroversial, over there it’s like cigarette advertising.

Posted by Jacko on December 11, 2003 at 2:51 AM (PDT)

5

I think that is the best idea I have ever heard! Apple has to get on this bandwagon, just with Milwaukee’s Beast or Keystone.

Enough with the “Think of the Children” attitude. Get over yourselves.

Posted by duffman on December 11, 2003 at 4:39 AM (PDT)

6

Maybe Apple doesn’t want/need this kind of promotion. Through quality products and service, Apple has held onto a dedicated share of the personal computing market since its debut in 1984. You’d think they may have gone under what with the fact that their #1 competition had an 80% market share.

Fortunately, there is a reason why Apple users remain Apple users. It’s a solid company with excellent products who doesn’t need to resort to outside companies for promotion like an upstart web-based business with little chance of it reaching solvency because it doesn’t sell porn.

Remember that Apple makes beans on the ITMS; the ITMS is more of Apple’s internal marketing and “sponsorship” of the iPod.

I think the name Apple and the reputation/features/convenience/style of the iPod will do just fine on their own.

IMO

Wunderdave

Posted by wunderdave on December 11, 2003 at 5:11 AM (PDT)

7

Napster needs all the help they can get. Roxio is bleeding money like crazy as music sales through Napster 2.0 continue to decline steadily. They are now well under 200,000 songs per week while iTunes Music Store is selling about 1.7 million per week.

Posted by Atomic Bomb on December 11, 2003 at 6:00 AM (PDT)

8

targeting the over 21 crowd is kind of a waste IMO.  That is the “lost generation” that won’t pay for downloads.  They may download a few songs when they have winning beer caps, but they’ll just go back to kazaa afterwards.

at least a pepsi deal can directly reach younger kids whose music downloading habits are (possibly) still shapeable.

Posted by mmmm, beer.... on December 11, 2003 at 6:45 AM (PDT)

9

Well, partering with a beer company doesn’t mean a damn thing one way or another, it’s just another business relationship.  Bill Palmer is an idiot.

That having been said, Napster is sucking wind right now because the service is retarded.  It sucks.  Everything about the software is a55-backwards, and the selection sucks.  The ONLY good thing they have going is the user playlists thing.

Posted by stark23x on December 11, 2003 at 7:05 AM (PDT)

10

I disagree with what mmmm,beer had to say above. I think that the older generation (mid-late 20s) is more likely to pay for music. They are the ones who have jobs and make money, as opposed to college and HS kids who are still either working part time or get money from their parents.

Also, Beer companies in america sponser everything from baseball games to television shows to rock concerts. So why is this looked so “down” upon?

Last I head both Napster and iTunes were continuing to grow, so despite iTunes far outselling Napster, I think Napster is doing allright. They are the little engine that could. I’m sure their goal wasn’t to eliminate iTunes by the year’s end….

Posted by digitaltrapper on December 11, 2003 at 7:10 AM (PDT)

11

“Napster is sucking wind right now because the service is retarded. It sucks.”

You’re ignorig the fact that the subscription business is a very good one to be in while the paid download model of iTMS, well, basically sucks. But Steve Jobs has difficulty seeing it this way:

http://www.rollingstone.com/features/featuregen.asp?pid=2529

One question to ask these subscription services is how many subscribers they have. Altogether, it’s around 50,000. And that’s not just for Rhapsody, it’s for the old Pressplay and the old Musicmatch. The subscription model of buying music is bankrupt. I think you could make available the Second Coming in a subscription model, and it might not be successful.

http://apple.slashdot.org/comments.pl?sid=88622&cid=7669825

Actual current numbers for the sub services:
Rhapsody (from Real Networks): 250,000
MusicNet: 175,000
Napster (formerly pressplay): 80,000
MusicMatch MX: 150,000

Total here is over 600,000. These services tend to run about $10 per month, yielding a total revenue of over $6 million per month across all services. iTunes has sold 20 million songs in 7 months, or less than $20 million in revenue with a tiny or negative profit margin. Subscription revenue during this time was $42m, and profit margins on subscriptions are much higher.

I use Rhapsody and it kicks iTunes ### - there’s just no comparison, given my listening habits (I’m almost always online). Looks like there are plenty of people who agree with me.

Posted by SubsRule on December 11, 2003 at 7:14 AM (PDT)

12

SubsRule: Your subscription numbers are grossly inaccurate. I’ve reviewed your sources - PR releases and the such. Those all include trial subscriptions that come with downloads of players such as RealOne and the like. The PAID subscription number that Jobs cites is very close to accurate. The re-up sub number is more alarming, though.

And by the way, you can listen to all the free music you want with the hundreds of various streaming radio stations built into iTunes for free.

Do you work for Rhapsody? That’s the only possible explanation for your strange statement. And I’d say that 50,000 paying subscribers agreeing with you is not “plenty” in the grand scheme of things.

And another thing: Apple doesn’t care to make money off iTMS. iTMS exists to push iPods. With profit margins of around $100 (estimated by my fellow industry analysts working in that space) per iPod, Apple is projected to turn $150 million profit or more on iPods alone this year.

Posted by Atomic Bomb on December 11, 2003 at 7:51 AM (PDT)

13

I agree - target the younger kids first and get their habits into buying music, not downloading off Kazaa. I am a college student, and I would definitely look down on a company that partnered with a beer company. Yes in the US beer is associated with college parties and getting drunk and other stuff I won’t go into. It’s a very negative thing here. Maybe in Europe it’s not so bad, but iTMS isn’t available for Europe yet..

Posted by kainjow on December 11, 2003 at 8:17 AM (PDT)

14

Everytime “Atomic Bomb” posts all I see is stupid errors and ad hominem attacks. Grow up!

RealNetworks Announces 250,000 Subscribers to Its Digital Music Services
http://biz.yahoo.com/prnews/031028/sftu155_1.html

Musicmatch said it had more than 150,000 paying subscribers
http://biz.yahoo.com/prnews/031028/sftu155_1.html

MusicNet reported that it has close to 175,000 subscribers to its service on AOL (up from 100,000 in late July), including more than 140,000 paying customers.
http://216.239.57.104/search?q=cache:fU238bHXYwEJ:www.grammy.com/news/newswatch/2003/1008.html+musicnet+“175,000+subscribers”&hl=en&ie=UTF-8

and so on. I work in the online music biz - trust me, Apple is not the only success story. This market is booming!

Apple’s success is precarious, however, given that they rely on the iPod to fund their music store. If iPod sales decline or they face pressure on their margins then they will start bleeding money. It’s an exposed position.

Posted by Neutron Bombs on December 11, 2003 at 8:37 AM (PDT)

15

“hominem attacks”?

No attacks here. Take a look at your sources. I’m sorry to be the one to inform you of this, but PR Newswire is not a source of real news. If you were working in the industry, you would have a better idea of the reality here.

Posted by Atomic Bomb on December 11, 2003 at 8:47 AM (PDT)

16

Good for you, Napster!  It won’t save a sub-standard service (iTMS is kicking tail!), but, there shouldn’t be anything wrong with them teaming up with a brewer.

I still don’t know who/why this Bill Palmer fellow keeps showing up?  <sigh> His latest ramblings are one-sided and a boring read.

Blargh!

Posted by Miso Soup on December 11, 2003 at 8:52 AM (PDT)

17

‘PR Newswire is not a source of real news”

Riiiiiiiight. And everything that comes out of Steve Jobs’ mouth is gospel truth?

Does the phrase “Reality Distortion Field” mean anything to you?

http://www.google.com/search?q=“Reality+Distortion+Field”+steve.jobs

Posted by Neutron Bombs on December 11, 2003 at 10:05 AM (PDT)

18

http://www.woz.org/letters/general/45.html

Steve Jobs has very strong belief in himself. He spends a long time thinking about products and directions in private, asking himself every question he can think of and formulating the answers. By the time he presents an idea, it is very well tested in his own mind and he has a big advantage over others. It’s fair to call this a form of intelligence. It’s even purer than some definitions of intelligence. Many of us are called intelligent if we have the same answers as everyone else. But Steve doesn’t operate this way.

Many times Steve has very good thinking that doesn’t take into account how things currently are. It’s my opinion that this leads to conflicts with most other people. Even when they (or I) agree that he sees the future correctly, the path to get there is in dispute.

Posted by Steve Wozniak on December 11, 2003 at 10:07 AM (PDT)

19

Do you even understand what PR Newswire is? Apparently not. Whether Jobs is subject to his own version of reality or not doesn’t change the reality of the particular fact he cited. Any reputable industry observer agrees with him on this. Do you know any such people? Do you actually have any useful knowledge on the matter at all? It sure doesn’t seem so based on your posts.

Posted by Atomic Bomb on December 11, 2003 at 11:03 AM (PDT)

20

Whether Jobs is subject to his own version of reality or not doesn’t change the reality of the particular fact he cited.

Listen to yourself you dumb Apple fanboy. listen to what you are saying.

What you are saying is that when others make claims they are obviously rubbish, but when Steve Jobs makes claims it is “fact”.

You are so deep within the Steve Jobs RDF that you can’t even think different.

“First 64 bit computer” is one of my favourite Apple lies that Steve Jobs et al repeat on and on, even though they have to know it’s untrue.

They are as much full of crap as Microsoft, it’s just they have better industrial designers but lousier business development.

Posted by IAmDaBomb on December 11, 2003 at 12:23 PM (PDT)

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