Apple is scheduling a complete phase-out of music downloads from the iTunes Store by early 2019, per sources at the company.
Apple is aggressively scheduling a phase-out of music downloads from the iTunes Store, according to multiple sources tied into the platform or working at the company itself. The termination has been in motion since 2016, when sources first tipped the story to Digital Music News.
At that stage, the plan was to sunset music downloads ‘within 2 years’. Now, plummeting download sales may be creating pressure to make good on that aggressive schedule. “More and more, [downloads] are legacy,” one source told DMN over the weekend. “That part is obvious.”
Apple has told DMN that no such phase-out plan exists. One source has repeatedly insisted that the plan not only exists, but that it is ‘on schedule,’ or even ahead of the original schedule.
Throughout the discussions, sources have demanded complete confidentiality. Phone conversations or personal email accounts were preferred, largely to avoid corporate monitoring of communications.
The current timetable calls for a complete termination by 2019, shortly after the 2018 Christmas season.
Importantly, that gives Apple two more Christmas seasons to operate. The plan minimizes disruptions among buyers, with a transition slated for a post-holiday, slower period in 2019.
The phase-out strategy also includes a clever transition towards Apple Music, the company’s streaming platform, according to one source close to the transition. According to details shared, the company would migrate a user’s iTunes download collection towards a brand-new Apple Music account.
Then, as part of a three-month transitionary trial account, a user’s entire collection would be migrated into streaming equivalents. All previous playlists and details would also be translated.
Downloads unavailable as streams would be grayed out, pending future licensing. “But you can always go back and listen to the downloads, they always will work,” another source noted. Over time, “more stuff becomes licensed” and the grayed out collection becomes de minimis.
But the key difference is that users won’t have access to purchase music downloads within the iTunes Store. “That road will be closed,” the source noted.
Word of the transition is happening as music downloads continue to collapse.
The move may be driven by data. According to details shared by Nielsen, paid downloads are crashing in 2017. During the first six months of the year, track downloads collapsed 24.1% in the US, while digital albums slipped 19.9%. Both formats are likely to drop 30% or more in 2018, eventually winnowing away to something negligible.
Concerns of iTunes ‘Bloatware’.
All of that is raising concerns about an overloaded iTunes, especially among Apple engineers who are increasingly frustrated with the platform. One source noted that iTunes has become a “big mess,” while another pointed to recurring “bloatware” problems that are affecting customers.
Pulling out lower-performing formats, especially music downloads, helps to solve the issue.
And then, there’s Spotify.
Also informing the phase-out is a meteoric Spotify. Despite numerous entrenched advantages, Apple Music remains heavily behind the Swedish leader. At last count, Spotify had more than double the amount of Apple Music subscribers. Spotify counts 60 million paying subscribers, while Apple Music has yet to just reached 30 million.
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And Spotify’s broader numbers are dwarfing those of Apple. Just recently, Spotify reported a userbase of 140 million active users. Apple, preferring a paid-only platform, has a far smaller audience size.
Separately, Spotify is moving towards a high-profile Wall Street entry. And, totally overshadowing Apple Music’s ambitious efforts to overtake streaming.
That may be causing serious frustrations within Apple.
Just recently, Apple Music chief Jimmy Iovine splashed salt on Spotify’s success, discrediting the company’s business model and vulnerability.
“If tomorrow morning… Amazon says, ‘Why don’t we try $7.99 for music?’ Woah, guess what happens?
“The streaming business is not a great business. It’s fine with the big companies: Amazon, Apple, Google… Of course it’s a small piece of their business, very cool, but Spotify is the only standalone, right? So they have to figure out a way to show the road to making this a real business.”
Sounds scary. But the reality is that Amazon Music is already sharply discounted. In fact, Amazon’s Prime-bundled streaming music plan is effectively free, yet Spotify clearly remains the market leader.
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That could be forcing some soul-searching at Apple, with product clarification a healthy strategic step. Indeed, Steve Jobs was notorious for pushing consumers into the future, even before they were ready for it.
These days, innovators like Spotify are doing the pushing. All of which makes it increasingly difficult for Apple to remain in the past.
Top image: DMN.
*Clarification (12/10): In 2016, sources pointed to a phase-out within 2 years, as well as 3-4 years on the longer side.
I’m just gonna leave this here : 256.8 billion in cash (may 2017)
Spotify : heavily bleeding money and with lotsa debt…
Spotify is a joke.
Spotify is KING OF THE WORLD. Bye Bye iTunes, hit the road jack, don’t come back no more, no more, no more! All praise goes to Spotify.
Are you personal assistant of the King of chutzpah Mr. Daniel Ek the hijacker?
Sign your name if you have anything productive to say!
HAHAHAHAHAHAHA
I agree. I give Spotify three years and then bankrupt. Its a VC supported loss making machine. It’ll outlive its usefulness to those investing soon.
You are living a a nether nether land, mr. record man. Spotify will rule all music in 3 years, and make Apple it’s bitch.
Spotify has never made money and is deeply in debt.
They have a lot of garbage and music copies and treat artists very poorly.
I get that you are a child but tell us what will change that.
Nether Nether Land? Idiot.
it’s never never land you fucking childish moron… KILL SPOTIFY!!!
All those billions in revenues need to got to the ARTISTS not the labels, streamers, managers or any other greedy fucks riding the coat tails of ARTISTS AND COMPOSERS… it should be 90/10 split in favor of the CREATOR not the seller!
As a musician, you have to be relatively popular to make any money from streaming. It’s a sad, sad world. Downloads is how you make all your money.
Sites like Bandcamp should take over this industry because they never stopped being artist first.
This doesn’t make any sense, especially in a world where windowing is likely the new normal. The fact that Apple has both iTunes and a subscription business gives it a strategic advantage over Spotify.
Yo, Anon that’s what the Pirate Bay is for. If the music industry wants to fuck us with windowing, we will fuck them right back! Simple, really.
Piratebay? You mean the distraction that music piracy actually affected the industry? It didn’t. Piracy was infinitesimally small compared to bigger issues – more things for punters to spend money on and user indifference in a swamped marketplace.
The music industry did fuck its self through piracy – it fucked itself by becoming old.
Spotify has never made money and is deeply in debt.
They have a lot of garbage and music copies and treat artists very poorly.
I get that you are a child but tell us what will change that.
Uh, lots and lots of quality music can be found on Pirate Bay dumbass. Lots of lossless music that the music industry won’t provide us because they are so far up their own asses and don’t give a shit. You have your own opinion and I have mine.
It will take more than one Taylor Swift album to make windowing the new normal. The vast majority of albums are still being made available on streaming from day one, without any windowing, all out of fear of piracy. Labels need to start windowing, make downloads relevant again, and start making money for themselves, artists and songwriters. Any increase in piracy resulting from such windowing is irrelevant. If they don’t start windowing, iTunes really will shut down. The industry can’t sustain itself on streaming alone.
Some respect, please! Bug off from my name even if you do have something productive to say about music or music industry!
The QUESTION IS:
When Apple will say, just like Microsoft just did, FUCK THE MUSIC?
Ek is running at -(MINUS) $300M/yr. You think Apple’s investors are equal ZOMBIES to Spotify venture boys? Someone inside Apple is also OBSERVING THE STREAMING BULLSHIT.
Remi, nobody cares what you have to say. Learn the english language first and then try making an arugument on here because nobody can understand your garbled trashed english and numbers. Thank you.
You must be twin brother of Daniel Ek.
Your writing looks like his face! RUDE AND SHREWD DUDES!
I just like lotsa drugs then go on a well balanced ramble on dmn
HAHAHAHAHAHA. Good one man. Yeah, you never understand the dude’s rhetoric or his numbers. Needs to learn the english language first.
Learn basic business and MATH!
Video games will finish 2017 at $117B
Subject to piracy movie rentals are well into $100B+ range
Music, the King of media will close 2017 at $17B – if we are lucky.
TIME TO WAKE UP MUSIC BUSINESS NERDOLAND and start simple $300B harvest obvious to an IMBCILE!
My daddy is dumb. He takes lots and lots of drugs. It has affected his brain.
Why doesn’t Apple introduce a free streaming service like Spotify does?
Many people don’t see any advantages of paying £10 a month to stream music. If you’ve got all the time in the world to listen to all the music you want then go ahead and pay £10 a month. Those who work and have other commitments are likely to play on average 10 hours of music a week. Therefore paying £10 a month to cover 10 hours worth of streaming music is ridiculous.
It would be £10 for 40 hours of music if you’re listening to 10 hours a week.
Amen!
Wait. You mean I’m going to have to start buying CDs again?
Yep or vinyl LPs……
BOTH!!!…The ol’skool is coming back. Just like everything else.
No, you can just use a streaming service. Any if you are wanting quality music, ie, lossless playback go with Tidal. Spotify will be coming out with Lossless very soon. Then its game over CDs.
Iovine: “If tomorrow morning… Amazon says, ‘Why don’t we try $7.99 for music?’ Woah, guess what happens?” The answer is almost nothing. This is what Iovine and Apple don’t get – people are loyal to the look, feel and usability of an app, to their stored libraries and friends, and to curation (Spotify’s is still far beyond Apple’s vaunted “human touch”). If they were truly aware of this, they would fix the awful interface, build a social component that works, and rely on data to create their playlists (and not the whims of a few biased individuals).
That’s an interesting point. Iovine is very committed to human curation, he really dislikes machine algorithms to determine what’s good. That’s been a debate for more than a decade, but, I think Spotify is really applying a lot of great thinking on the algorithm side.
If the data shows that people listen to a song more than 30 seconds a higher percentage of the time, that they add it to playlists, that they inspect songs from the same artist, that metrics on other platforms like Shazam are great — doesn’t that mean people like the song? And that Spotify should give fans more of that song?
Better question: can ‘Joe Curator’ really determine that better than a machine? NOT the ‘machine’ that existed in 2012, but the one that exists now?
Paul, You just started to hoover above $300B Discovery Moment Music Monetization! Bravo!
Ek boy should jump on the wagon better yet, make this wagon reality OR him and his Spotify will become EMPTY SPACE!
Remi, are you speaking English or some other language we just don’t understand? Just stop it. Please. Learn to speak the english language first before posting your bullshit on here. Thank you.
Daddy, have you taken your meds today? You are speaking more dumb than usual today.
Son, I think it’s time you logged off of this site. It’s time to put a stop to your nonsense. Time for bed and your meds.
Oh yeah, I forgot my sign off. PRAISE BE TO SPOTIFY!!! HAHAHAHA
TROLL
There’s something I don’t understand
May 2016…
https://www.recode.net/2016/5/11/11660982/apple-itunes-music-downloads-not-true
I don’t know much about the business, but I will say on I-Tunes they have taken back songs I’ve paid for i.e.: an INTRO’s instrumental,a Justin Timberlake instrumental and now 17 video’s I paid for and I sent the a msg about it. Still no reply. It’s almost 2days I’ve heard nothing. I see I-Tunes does what it wants no email or anything to tell you they’re gonna do something. I’m gonna see if they get the video’s playing? If not I’m expecting a FULL REFUND or a store credit.
haha, but we can upload the music with itunes personal computer
http://www.digitalponsel.com/857/harga-iphone-6/
Sucks for anyone that invested their money in a large library worth of iTunes content over the years. An obvious tip for what to do next: get a phone/device that doesn’t restrict you to its tiny sandbox of usability (read: buy android), then buy music downloads direct from the websites of the artists that you love and want to support. And definitely don’t be a pirate ?
A song is not an investment. It will not yield you returns financially in most cases. An investment is something that will yield future returns, such as a stock, bond, or interest payments.
Not really I’m an Indie and made way more in the past about 18 months since streaming is taking over.
excellent article topic on the evolution of music consumption. driven by the c21 digital product consumer rental v purchase i.e. the stream of a track v the purchase of a track.
re: musicians getting paid for work there is a new music business model on the horizon block-chain powered music platforms using musicblockchain tech.
of interest to your readers / followers – this link takes you to a track on @musicoins as an example of how an artist can earn revenue from music content streaming (digitalTRAFFIC earns 1 musicoin per play and its Free To Play) –
https://musicoin.org/nav/track/0x72a75a9df1b93e33afd3a15a9eaa74393b69d889 .
PLEASE NOTE: This is not intended to be an endorsement or advertisement for this concept but a simple illustration of a possible future revenue generator for fellow musicians / artists.
This could be an important / valuable alternative revenue stream for artists
in this current streaming culture.
Heard the truth, but we also publish our latest album on itunes Service, if wanna listen, to go through as it’s become very famous.
Forget Streaming.
For a lot of planet EARTH, data costs money. Streaming wastes LOTS of money.
I’ll buy the physical CD, DVD, or BluRay before streaming music, TV, movies.
#1. I REQUIRE Physical Backup for all purchases.
I won’t pay to plug into your ‘cloud’.
Don’t sell it on Disc ? Don’t expect any revenue.
#2 Gigabytes costs mega bucks. $$$$$$$$$$$
Download speeds are still to slow in mostly all USA to even ‘watch’ streaming video. I can queue up a few downloads, and watch it the next day, after the machine spent all night nibbling away at the files…
#3 Amazon / YouTube / Others DO NOT offer download. YouTube actively blocks your downloads and corrupts data to break playback on your PC. Forget them. iTunes ALWAYS had the market domination, because purchases, PURCHASES, not rentals – allow full music CD creation, keeps safe copies local on your machine, and the DRM is insane communist evil, but it was quiet most of the time.
#4 Apple says it no longer supports iPhones on iTunes, and no longer supports any version of windows before Windows 10. So, bye bye Apple, fall off the Tree and ROT.
#5 Oh, look, it took two clicks of my mouse button to transfer all my purchasing away from iTunes directly to AMAZON PRIME. Free shipping on all the CDs DVDs and BluRays I WANT.
Cut your customers off, wonderful business plan, Tim Cook.
Good Luck with that. P.S. I love my Samsung and LG phones.
Bye Bye Communist China. HELLO South Korea Manufacturers.