Being a market leader is tough – being a market leader in the music business is even tougher. Such is the position in which Apple finds itself with the iPod and the iTunes Music Store.
Apple’s iPod claims 25% of the market for all digital music players, and a whopping 70% of all legal music downloads. According to an article from UK newspaper Financial Times, however, if Apple doesn’t watch its back, the iPod could wind up being just another player, or worse, eclipsed by the next big thing.
The article, Apple in danger of missing out on the fruits of its labour, says that unless Apple finds a way to stay ahead of its competitors, it will succumb to increasing competition. From the article:
Almost three years after the launch of the iPod, there is little indication yet of how Apple plans to stay ahead of its rivals. “Sooner or later someone else will figure out music as well as Apple. Then it will become one among many,” says Michael Gartenberg, analyst at Jupiter Media, a research company.
The pressure to innovate is mounting. Apple’s core business remains its computers, sales of which have stagnated. In the last 10 years, Apple’s market share in PCs has fallen from 9 to 1.8 per cent, according to research group IDC.
Read the full article at the Financial Times Web site.
The Mac Observer Spin:
Let’s see if we have this right; If Apple doesn’t innovate, someone will ultimately catch up to the iPod and then Apple would be in trouble.
It certainly seems as if a “Duh!” should be inserted somewhere in the article. Apple has always been about staying ahead of the pack by innovating. The truly surprising thing would be if Apple did absolutely nothing to keep the iPod ahead of the competition.
That said, many have called for a video iPod, but Apple’s CEO went on record at the company’s annual shareholder meeting as saying “It’s about the music, stupid.” Instead, Apple has chosen to focus on issues such as form factor and ease of use, keeping the idea of listening to music central to what the iPod is. It seems likely that this will remain the focus for the company in at least the near-term future.
How Apple will exploit this is uncertain. What is certain is that by positioning the iPod at the core of digital entertainment, it will be hard to unseat as the reigning champ of music players.