iTunes Social Media Overhaul? Speculation fueled by industry insiders surrounding Apples autumn press event Sept 1.

Posted on August 26, 2010


(FierceMobile)- Following news that Apple will hold its annual autumn press event on Sept. 1, speculation about the computing giant’s plans is accelerating, with music industry executives forecasting the introduction of iTunes social media integration enabling consumers to share recommendations and playlists via services like Facebook and Twitter. All Things Digital reports that Apple has not approached its label partners to revamp their current iTunes licensing deals, effectively guaranteeing the much-rumored, cloud-based iTunes streaming service is on hold, at least for the foreseeable future. Record execs instead believe Apple will unveil a lightweight, web-based iTunes giving users the flexibility to share their musical interests (but not actual music content) with their social media contacts. “There’s a reason [Apple CEO] Steve Jobs calls it an iPod-he thinks you listen to music by yourself, on your headphones,” said one label executive. “But lots of people like to share music, and if this lets you do that, that’s exciting.”

Another popular music biz rumor: Apple will roll out a wireless system simplifying management of iTunes purchases, allowing consumers to move copies of songs purchased via iPhone to a laptop (or vice versa) without manually connecting the two devices. All Things Digital notes that Apple’s existing license agreement allows users to sync iTunes music across five devices at a time, so the wireless service would not necessitate changes to its current label licenses–likewise, social media integration would also fall within the parameters of the storefront’s established agreements.

Gleacher & Co. analyst Brian Marshall tells Reuters he anticipates the Sept. 1 event will yield few if any major announcements beyond a revamped iPod touch. Marshall does not expect Apple to introduce its streaming iTunes service until the first half of 2011, following completion of the company’s new $1 billion data center in North Carolina. Marshall said Apple could also introduce TV show rentals, a possibility widely reported earlier this week. “Fast forward a bit, to early next year,” Marshall said. “By then, there will have been a total of 200 million shipments of iPhones, iPads and iPod touches, all the devices that run Apple’s iOS. That makes Apple a cable company with 200 million subscribers.”

iTunes sales topped $1 billion during the second quarter of 2010. The digital storefront now accounts for 70 percent of all premium music downloads in the U.S. according to NPD Group data released in late May. iTunes’ growth is slowing, however–NPD notes its share of the digital download market has remained essentially flat since the first quarter of 2009, increasing just 1 percentage point since that time. Rival AmazonMP3 increased its market share by 4 percentage points, and now represents 12 percent of the U.S. digital music market. Sales of digital tracks and albums accounted for 40 percent of overall U.S. music market share in the first quarter of 2010, a gain of 5 percentage points since Q1 2009, NPD said. Adding physical music purchases to the equation, iTunes still leads with 28 percent of all U.S. sales, a 4 percent year-over-year leap.

More than a quarter of iTunes, iPhone and iPod users express strong interest in free cloud-based music services, with many willing to pony up a subscription fee to access their music libraries via multiple devices and platforms, according to an NPD consumer survey published last month. Asked their reactions on different free and premium options offering combinations of music streaming, music downloads and universal web access to their iTunes library, between 7 million and 8 million U.S. consumers tell NPD they would have serious interest in one of the paid alternatives, indicating a willingness to spend a minimum monthly fee of $10. NPD research also notes that a model giving consumers free streaming access to iTunes would attract 13 million to 15 million subscribers.

Posted in: Apple