How to grow the iPod as the MP3 player market shrinks

Apple simply dominates in the player field! But the main criticsm is the fact that Ipod’s are tied to the itunes website. And the primary goal is to have basically a closed system that conveniently feeds off itself. Now if Steve jobs wants to administer the coup de gra (sp?) to the mp3 player field he doesn’t have to change the itunes site but change the software in the ipod to run ALL forms of digital music. This would simply crush all other competitors in the mp3 player field. So… How ’bout it Mr. Jobs?

Mea culpa. The critics are right. I allowed myself to be seduced by a clever headline. It’s the MP3 player market that is “incredibly shrinking.” The iPod market is still growing, although its growth rate is slowing. I’ve rewritten the head. Sorry.

Just kills me to listen to some people, Apple is seeding the market? Apple makes products, if people like them they buy them which for the iPod has been (and still is) very successful. I looked at Amazon a few minutes ago, 5 of the top 7 selling MP3 players are iPods. I thought the Christmas rush was last month? But no lets tank the stock on iPod rumors that aren’t true and forget about all the other products Apple has that are flying off the shelves!!

DeWitt contradicts himself. AGAIN. A market that is growing is shrinking? If the growth rate shrinks that doesn’t mean the market shrinks. Growth means GROWING.

It’s amazing that someone who writes so poorly can find big time site to publish his “stuff.”

Philip,

How is it possible that a journalist with your credentials cannot properly align an article with a headline? The inference in your headline is ominous, yet the true story isn’t anywhere near that. And this all because you don’t make a distinction between market growth and market. The market is not shrinking—just not growing anymore the way it used to: the growth is shrinking. As it is, there is a negative growth of 4%, which is indeed a slight shrinkage, but that is not the same as a screaming headline “the incredible shrinking iPod market.” A negative growth of the US economy is not the same as “the incredible shrinking US GDP.”

A few years ago a mostly dead-on Gene Munster, on whose report you are basing much of your confusing, wrote that a 70% $-share of the MP3 market simply was not sustainable for the iPod. It defies gravity (I’m paraphrasing). Back then I tended to agree with Munster. Currently iPod sits on 84% $-share. Something is indeed incredible, just not what you infer it is.

Growth is relative. 50% growth in a 40 million dollar market is less than 10% growth in a billion dollar market. How crazy is it to make that comparison. It’s like car sales. In the 20’s, 30’s, 40’s, etc the rate of growth was phenomenal, now that there is a saturation point (so to speak) with automobiles, the Big 3 are bragging over 3% increases in sales. Clearly another measure is needed to accurately define success.

I like your comments Nodack Phoenix, AZ, you are right all the way.

Umm, why aren’t analysts adding iphone sales to ipod sales and looking at the total? If you buy an iphone you are not going to buy an ipod.

That would put a whole different perspective on MP3 player growth.

Hysterical, Nodack! I would be even more funny, if it weren’t true…so, why is that Elmer?

Now, here’s something funny

Imagine that Apple rolls out wireless capability iPods, super 3G iPhones, and other wireless hardware. Soon enough, as close as 5 years, we’ll be doing everything from our Apple wireless devices, from getting groceries to home-schooling our children, movies to voting, even working while on vacation in a Pilgrimage to Tibet. Then, with 85% market share on these markets, everyone will need the Apple logo to make a transaction of any kind… I think there’s a passage on the book of revelations and the book of Daniel about this…

is Steve Jobs the antichrist? (gasp)

Get real, apple bashers and apple groupies alike. There’s always a side to pick, but in the end, Apple wins either way. For a supra-marketing company, the fact that there’s countless blogs dedicated to their brand and business, is priceless.

“The Incredible Shrinking iPod Market”

That’s right folks, you herd it hear first. Market research shows that people no longer want to listen to music anymore and nobody will want to buy music players as a result.

Also an unnamed and unconfirmed source has claimed that people will no longer be useing cell phones to make phone calls anymore so that should lead to a drop in iPhone sales.

In computer news, Derf Senrab reports that a Chinese company Yung Yung Goo who makes muffler capaciters for the new Mac Air has reported a 2% drop in capaciter orders leading speculators to predict that the Mac Air will be a huge flop.

Apple shares fell today on news that Steve Jobs visited the dentist leading speculators to assume Steve Jobs will be leaving the company to start an Ostrich farm in Greenland.

“you could wirelessly order your drink from your iPod, pay for it using your iTunes account or the attached credit card, and pick it up without ever standing in line or waiting at a cash register.”

This is another set of wishful thinking I read so much about during the last dot com bubble. The current bubble is not as bad as the last one, but it is bubble none the less. AAPL is going to slide past $100 or even test $50 before regaining strength and momentum.

People are not interested in owning bits and bytes companies at this time. They are moving their money into companies which have tangible products.

Add iPhone to iPod and Apple did well.

Still would be interesting to know if users are switching to music phones in general.

I would like to see Apple come up with smaller iPhone at a lower price point with no data dependency.

The answer to Apple’s woes is pretty simple.

It has three product lines within the mp3 player family that are competing with rather than complementing one another: iphone, itouch, ipod.

Time to go back to one simple product line: the new ipod.

New ipod comes with 80 or 160gb flash memory, touch screen features, all of the neat apps that iphone/itouch has, it costs $299 for the 80G model, $399 for the 160G model, and by the way, it’s also a phone.

So if you are an existing AT&T customer, or you are ready to switch carriers, get the new all in one ipod/iphone and activate the phone. If not, use it as an ipod.

Add pda functionality allowing a modified form of Leopard to run on this new handheld, and carry all of your business work with you, access the internet via 3G connection or wifi where available, have ALL of your music, movies, pictures, etc. wherever you go.

Effectively, make one device that is a Pocket Mac designed primarily to be used as an ipod, but capable of being used as a pda and/or phone.

One product line. One marketing campaign. Maybe you even add a 16-30G nano version of it for $199-$250.

Roger (reply)

What I think you fail to see is that is isn’t a article that is positive in any sense.

It poses possibilities based on a negative bias towards Apple.

As for you comment basically saying we aren’t clued into what Philly is writing is simple rubbish.

Here is lyes the problem with the majority of so-called jounalist in todays blogoshpere.

The cannot write without a. biased. b. the inability to show supportive, factual data to backup stories or “personal Claims.

Yes Philly shows data, so don’t go there, yet if you have been following the majority of the news regarding AAPL and Apple inc. you will see that there is a utterly contemptable disgusting attempt to discredit any and everything that Apple says, does, or put out as statistics.

Why? You tell me.

But get off your high horse that get over yourself thinking we can’t and don’t read between the line…

Precisely when did the iPod market shrink? Not only do you mistake a decrease in the “rate of growth” for market size, you seem not to notice that the rate of growth is still positive. The iPod market actually continues to grow.

The iPod touch is Apple’s escape hatch if the global cellular companies don’t play fair/well with Apple on the iPhone. Cook’s comment about a “mainstream Wi-Fi mobile platform” makes it clear that a more ubiquitous Wi-fi hotspot network and location-based services are in the offing, whether it be commercialized, or via personal routers like FON, or both.

Apple is busy seeding the market with iPod Touch “wi-fi players”, just like they seeded the market with millions of iPod nanos last quarter before launching iTunes rental movies.

This is my info for the Comment I wrote on uncle Philip

Hi Philip,

It seems a lot of the article’s readers didn’t read. Many thought you were writing a negative article while you actually wrote a positive and thoughtful article saying most of what the readers said.

Just my take uncle Philip

Roger

As a mother of two kids, 9 and 12, I would like to point out
that all the kids think it is the coolest thing to watch
TV shows with their Nano. -Ipods’ appeal is beyond the
traditional MP3 player group.

They produced blow-away earnings and always are conservative in future outlook. Only the press could find fault with Aapl and force the selloff with several negative articles. Disgusting. They have not persuaded me to sell. I have an iPhone, my kids just bought Macs vs. Dell, and I’m in for the long term. The negative articles make me MORE bullish.

I think the iPod Touch tests the proposition that some people (like me :-) don’t want a smart phone, as much as a smart everything-but-phone.

When the storage in the Touch approaches that in my current iPod, I’ll buy it. By that time I expect a bunch of solid 3rd party applications, so the Touch replaces my old Palm for calendar, contacts, etc.

dave

Dribble.

Wasted blog space.

Frigtards with nothing better to write about.

This is a media imposed recession and what the hell AAPL has to do with it?

Nothing.

Their earning report what stellar.

Their market share is growing every Qtr.

They are in the black 15 + billion in the bank. Debt free.

You are all a bunch of hacks with nothing but doom and gloom.

The only market excitement that is of value to you is that Viagra is still being sold and not pulled for blindness yet.

But there is alway Cialis for you Limp wristed hacks.

Errr, Apple already has a device that has Wifi and Touch screen. It is called iPod Touch.

I’m been using my iPod Touch as a PDA and it works great.

Oh yeah, I also listen to music and watch movies on it, too.

Oh yeah, I also play games on it via webapps.

Oh yeah, I also check my emails while on the road when I’m at a hot spot.
Did I mention you can watch videos? College podcasts and online course.

This is the future baby.

Man, again, choose your words better…

“The bad news is that the market for MP3 players is shrinking rapidly”… Year-to-year spending trend going down but having a steady market share and market volume means a normalization of the market, NOT a shrinkage. No business or product can have a 50% increase indefinitely, Fudd.

About the rest, unlike most of the blogs you post, I agree with you and Munster with the prospect of turning the MP3 player market into a personal portable computing market, given the existing Wi-Fi and incoming WiMAX capabilities set to bloom in the next 24 months. It goes way beyond just buying lattes. Imagine not to have to stand in line in the bank, order groceries, and even trade in the market while you’re sitting on a bus or train, or having a stroll in the park. It would be the apex of portability.

aapl always seems to have the next stage of their grwth planned well in advance very good, now some tact with the guidance would be nice ,what were they thinking

Yeah, Where are the “Zune” numbers? Or is that a “state” secret?

I didn’t sell my stock when it reached 200, and now at 130 I am hanging on. Should I. Is Apple going to come up with something great?

I have a Ipod Touch and this the future. I use it all day long for browsing the internet, email and Google maps. I rarely listen to music. I just hope that in the future they make a model just a bit larger for quicker typing.

Last July, I bought my 1st iPod. It isn’t a touch one that does internet. I love my iPod. It is greastest thing since sliced bread. I plan to buy the iphone which has the internet. My nephew has one and says it is the best phone he has ever owned.

It’s Apple’s nature to innovate their way out
and they are not going to stop now the iphone and ipod touch are the future of mobile computing
you can bet your house that Steve Jobs has already a plan
for many future products

22 million iPods in 3 months…

Yeah, that’s a hell of a number to be upset or be concerned about….

I agree entirely with Hugo. Apple has an surpassable niche and is destined to go higher and higher in the years to come. Go APPLE all the way!

Apple has already innovated itself out of the decline in iPod numbers, by introducing the iPod touch, which has a higher price and higher margin, and lots of new features. I have one myself and I don’t even use it for listening to music. You state in your article yourself that Apple took 90% of MP3-buyers dollars. I think the future for Apple looks very good.