THE ITUNES COMPETITION

iTunes Music

iTunes offer single songs for download in the US at 3 price points – USD$69c, USD$99c or USD$1.29c. Purchasing an entire album is approximately 30% cheaper.

The main competition comes from a number of similar on-line music retailers that primarily offer either digital downloads, or a subscription-based service.

Download services include Amazon MP3 and 7digital, now available in 37 countries.

Subscription services include Spotify, Pandora, Google Music, Grooveshark, Jango, Last.fm, WiMP, Deezer, among others.

Music piracy is a concern for Apple and other digital music retailers, with 28% of internet users globally reported to access unauthorised services per month.

iTunes Video

iTunes enables access to movie rentals, which typically range from USD$9.99 to USD$14.99.

The main competition comes from live streaming services such as Netflix, Hulu, Amazon & Quickflix, and BigpondMovies in Australia.

Movie piracy is also considered to cause significant impact on revenue in this market, although the real impact is unknown.

Apple is also developing and expanding into the TV arena, with the development of their Apple TV product. The main competitors in this area are services such as Google TV, and a variety of other media boxes.

iTunes Apps

The Apple App Store opened in July 2008 via a new release of iTunes.

Apps can be downloaded onto a variety of devices including smartphones, PC and Macintosh computer.

Apple takes 30% revenue of all apps, and the app developer gets 70%.

Their main competition are similar app stores run by Google and Amazon, both for the Android operating system.

iTunes Books

Apple offers both audiobooks and electronic books via iTunes.

Over 20,000 hours of downloadable Audiobooks are available exclusively on iTunes, in conjunction with Audible

The iBooks service was released in conjunction with the release of the iPad, via an iTunes update in January 2010.

The main competition in the eBook market is again from Amazon, the Amazon Kindle.

Apples Other Offerings

Macintosh computer, hardware and software – main competition has always been Microsoft Windows and the PC.

iPod / iPhone / iPad smartphone and tablet devices – a variety of competitors including Android manufacturers such as HTC and Samsung.

iCloud – Software as a Service (SaaS), offering drive space in the cloud. Major competitors include Google Cloud, Dropbox and SkyDrive, among others.

A recent Nielsen report shows that 2 out of 3 new mobile phone purchases in the US were smartphones. Of these, approximately 34% purchased an iPhone, while over 50% purchased an Android device, indicating that the Android operating system is looming as a significant threat in this market