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The iTunes Store: Impact on the Music Industry and How We Listen to Music

Since its creation in 2001, iTunes has become a fundamental and revolutionary part of the music industry. It was the first legitimate digital music store and its conjunction with iPods freed digital music from PCs while also completely changing how we access and consume music.

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Artists had, for a long time, combating the digital sale of music because of the simplicity and prevalence of piracy sites like LimeWire. iTunes provided an alternative to the online piracy which provided benefits to independent artists, but is creating the liquefaction of albums and increasing the importance of singles.  On July 5, 2005, Apple announced that they were counting down to half a billion songs. The buyer of every 100 thousandth song up to 500 million would receive an iPod Mini and a 50-song gift card. The grand prize for the person who downloads the 500 millionth song was 10 iPods of their choice, a 10,000-song gift card, 10 50-song gift cards or 4 tickets to the Coldplay world tour. Would be awesome to win free iTunes cards like everydas don’t you think? On February 11, 2010 Apple announced that it would be counting down to 10 billion songs downloaded. A $10,000 gift card was offered as a prize. On February 24, 2010, the 10 billionth song, “Guess Things Happen That Way” by Johnny Cash, was purchased by Louie Sulcer of Woodstock, Georgia

Below are some of the main ways in which the iTunes sale of music has changed the music industry.

Independent artists and labels got more attention.
The movement of music sales from store shelves to an online interface took away some of the edge that major labels and popular artists had in terms of purchasing shelf space. Robb A. McDaniels, the Founder and CEO of Isolation Network Inc. and INgrooves noted iTunes’ system of meritocracy. If an artist presented great music, iTunes would promote that product right alongside the major labels, whereas in the old system, major labels would buy out shelf space and shove out the smaller labels. New artists on iTunes enjoy greater visibility and have an established niche on the site which cannot be encroached upon by other competing artists, allowing consumers to purchase any music that interests them.

The increased popularity of digital music enabled the success of online radio services.
As people go to the internet more and more to listen to the music that they love, radio-like streaming services that allow customers to listen to certain types of music for free have increased in popularity. A few notable online radio services that have become widely popular in the recent past are iHeartRadio, Pandora, Google Play, and Spotify. “The Infinite Dial 2015”, a report by Edison Research and Triton digital performed in 2015, found that 119 million people listen to online radio weekly. Online radio enables users to listen to music for free, usually with a few added perks such as a limited number of “skips”. Paid subscribers, of which Spotify currently has the most out of all the online radio providers, can enjoy music without the interruptions of ads and may also acquire additional benefits such as more available “skips.”

The 99 cent download price became standard for online music.

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iTunes’ 99 cent fee to purchase any single was a defining feature of the online store since it started. Previously, consumers had been made to purchase an artist’s entire album if they wished to own any of their music, and most people only hold real interest for a few songs off that entire album. One of the reasons that piracy sites were so popular was because they enabled people to purchase only the songs they desired without having to buy the whole album. iTunes’ 99-cent price for singles enabled people to continue this practice but obtain the desired songs legally and in better quality. Later online music stores also set the prices of singles at or near 99-cents, probably following iTunes’ pricing in order to better compete with them. In any event, the price has become a relative constant thanks to iTunes’ initiative.

The death of the CD market
The decline of the CD market ties into the popularity of iTunes’ ability to sell songs off of albums as singles as well as the resulting popularity of streaming sites. In the face of these more accessible and more specific forms of music acquisition, CD sales have faced a marked decline. In his article “The Death of Music Sales”, Derek Thompson says that CD sales have decreased by 15% from 2013 to 2014. This decrease shows a drawback for artists in the age of digitalized music; as people turn to online stores and streaming, music has become superabundant and caused artists to have to rely on concert ticket sales for revenue, as this is the one domain where there is still enough product scarcity to allow for increased pricing.

The iTunes Store gave people the ability to choose exactly what songs they wished to listen to at prices that enabled almost anyone to easily purchase them. It shifted the music market from stores and onto the internet, where artists of all backgrounds and record labels could compete for listeners based on merit. The way we approach and listen to music in the past decade has vastly changed, I believe a great deal of that change can be traced back to the advent of iTunes and iPods. Perhaps they are just catalysts for progress into the digital world, as more and more aspects of our daily lives moves onto the internet, but the principles and ideas that iTunes contributed to the music world certainly has had an undeniable impact nonetheless.