Three months ago, Apple said they had no plans to drop music downloads from the iTunes Store. Now, it’s happening in one of the largest music markets in the world.
In May of this year, sources to Digital Music News pointed to plans by Apple to drop music downloads from the iTunes Store within 2-3 years. That information was flatly denied by Apple, though now, music downloads are already being nixed in South Korea, one of the largest music markets in the world.
Early this morning, Apple Music hit the critical South Korean market, land of K-pop, Samsung phablets, and ultra-fast broadband. But paid music downloads, once a critical component of the iTunes Store, are nowhere to be found in the iTunes upgrade. Instead, users are being funneled into an Apple Music streaming subscription, with prices landing at roughly $7.99 a month for individual plans and $11.99 a month for family plans.
Similar to major music markets like the US, Apple Music is offering a three-month trial period, though artists can expect drastically lower royalty payments during that period (as first reported by Digital Music News). Here’s a quick look at what a major album looks like in the iTunes Korea app this morning:
That follows a curious development in China, where Apple Music launched without an iTunes complement. Which means, no iTunes-powered music downloads, and yet another example of Apple moving beyond one-off track sales.
Apple Music is seriously late to South Korea, which is the eighth largest music market in the world. Unlike the United States, where just three major labels account for roughly two-thirds of all music downloaded and streamed, Korea is dominated by independents. Accordingly, Apple is swinging big with 30 million tracks, but lacks a huge quantity of critical K-pop catalog.
According to sources in South Korea speaking to DMN, Apple is apparently experiencing difficulties negotiating with heavy-hitters in the country. “They couldn’t get all the major players on board,” one source relayed, while noting Korea is “a tough nut to crack” for an American company like Apple. Separately, the Korea Herald is reporting that Apple “failed to negotiate with local music firms aside from the big three of S.M. Entertainment, YG Entertainment and JYP,” a gap based largely on disagreements on royalty splits.
That said, the Herald also reported that Apple is likely to pay far higher royalties to artists, based on industry sources. That could put pressure on local players, most of whom are paying minimum, legally-required royalty rates. Separately, one Korean insider pointed DMN to a history of bundling massive amounts of downloads with cut-rate streaming packages, a move that dramatically devalue recorded music.
Korea is the 110th market rollout for Apple Music, and closely follows a launch in Israel. But unlike Korea, Israel is offering ‘millions of DRM-free downloads,’ alongside movie and TV downloads.
Now, the $100 million question is when Apple will dump downloads in markets like the United States, not to mention Europe and smaller countries like Israel. In 2016, paid music downloads are experiencing double-digit declines, with both Sony Music Entertainment and Warner Music Group reporting drastic collapses in the format. Meanwhile, iTunes has become a ‘bloatware’ mess of conflicting services and overlapping passwords, with music downloads directly competing with Apple Music streams and quickly receding into obsolescence.
All of which suggests that music downloads are sunsetting, with a possible retirement likely in a few short years. And the best part is… you heard it first on Digital Music News.
More as this story develops!
Jesus f***ing christ, I hope it’s a software glitch.
Doubt it…
This is the beginning of the end financially for Independent artists. Korea is just the beginning.
Indeed. Was having this conversation with a few other artist friends the other day; the future looks hopeless. All of us are thinking that there is no future making a go as an indie artist anymore; we were able to in the not so distant past, but piracy and the continuing devaluation of music are destroying the foundation of the musical art.
The only source of income anymore is live performance, but that is only for those with enough of a core audience to be able to sustain continuous touring. Not to mention the health, endurance, and lack of family or other commitments to be able to undertake the touring life, and that the music you make actually translates to live performance.
Interesting developments in South Korea and Israel.
I think the download business is still very viable in places like UK, Australia, Canada, New Zealand, United States.
The huge hits still sell millions of download singles … there is still plenty of money up in them there hills…
Some markets are notoriously bad for selling downloads such as Greece and some other European countries.
In an odd way.. apple music may actually turn out a bigger money spinner for artists/labels than paid downloads because it’s so easy for consumers to flick from one thing to the next and try-out tracks where before maybe they wouldn’t have..
UK, Australia, Canada, New Zealand, United States are nice countries with still few honorable folks!
Rest of the world or European countries are just bluntly practical: YOU KNOW THE NAME OF THE TUNE YOU ARE THE OWNER thank you Google, Shazam, Soundhoud and just few more for keeping music in the open, free for grab by anyone!
“Rest of the world or European countries are just bluntly practical”.
Don’t they have a conscience? What about paying people for their work? It’s fine to steal and destroy a musicians’s life as long as you can get away with it?
Don’t pretend it’s “victimless”.
Eventually every song will be available for free. Millions upon millions of songs are already available for free on legal websites (artist websites, youtube, etc.)
That should be up to the artist to set the price for their work.
I don’t know anyone under 30 who buys downloads *shrug*
Millions do!
And millions still buy CD’s! Isn’t that great!
I know plenty.
I remember a time back in the early 2000’s when everybody thought streaming was dumb/useless because you didn’t own the songs. That was always the argument against streaming. Now everybody streams to their heart’s content and nobody even cares about owning their music anymore. Pretty funny. I saw the writing on the wall when I was using Rhapsody back in 2001. About time the rest of you caught up!
What a dopey comment, mr. “Futurist.” Anyone with true strategic thinking skills knows not to project their own biases onto the facts. No, not “everyone” is streaming, and you are wrong that “nobody” is buying music anymore. An objective look at the facts show trend lines favoring streaming presently, but your assertions demonstrate a closed mind and poor fact-finding skills. Let me guess, you also projected the “death of vinyl” back in 2001 as well…
“Anonymous2”, at least I can use my real name. Stop hiding behind your keyboard you little man. I say “MOST” are streaming except for you and your ilk. Please, don’t try and get all rhetorical with me. Your assumptions are baseless and unfound. And by the way you guessed wrong little man, I have a turntable and play records all the time. Now who’s the ass? Waiting for your witty and objective reply…
Did iTunes ever have music downloads in Korea? Can you drop something you never had?
Ha, exactly. The iTunes Music store never launched in South Korea…
Correct, there never was an iTunes Music store in South Korea.
Wouldn’t it be time to correct this?
http://uk.businessinsider.com/apple-hasnt-stopped-selling-music-downloads-itunes-south-korea-streaming-2016-8?r=US&IR=T
What’s to correct?
Apple finally expanded iTunes in Korea towards music, which only includes streaming (Apple Music). This is after basically ignoring the music market in South Korea (the 8th largest market). Previously, iTunes Korea had apps. So yeah, they dropped downloads as they globally expanded.
If not, there would be music downloads available.
Your turn.
Yes, we heard it first on Digital Music News, thanks again to Paul.
The digital platform and the web have torn apart music into pieces.
When music became just another track out of million others, that’s when it lost its artistic value.
We have to fight back and revive the album format!
Whatever delivery form, whether on vinyl, CD, flash drive or who knows what else – these are only containers of the real thing – the album concept – the perfect structure for any music session.
—
Nissim Elias,
allmusicrating.com
There was never an iTunes music download store in Republic of Korea in the first place. So it’s a case of right off the bat going straight to streaming and bypassing the paid download model.
Maybe there isn’t much scope for selling downloads or maybe it’s because of licensing issues.. Reports suggest that the physical CD business is still strong in Rep. of Korea, particularly with producer created “made for TV” pop/dance vocal groups.
And the screenshot does not show the Korean page, which exists to access the US download page, in translation. I wonder who the source is, who got it completely wrong.
What a crummy linkbait website.
You can’t *drop* a service you never *had* int he first place.
And you can’t have a respectable news website unless you update articles when they are are blatantly wrong as this one.
DMN… What a crock of shit.