Apple’s new music downloading service, iTunes, reported two million downloads in its first 16 days of operation, a startling success. I continue to hope that it falls flat, for the reasons I wrote up on May 1. If consumers sign up to digital rights management at a dollar a song chosen from an inadequate library, the industry will seize on it and carve it in stone – and our chances for a better deal will go down dramatically.
But if the service is successful, there might be another side effect. By any objective measure, Apple has been spectacularly unsuccessful at selling computers. For years, each new model has been released amidst great fanfare and press coverage about how darned exciting it is – and Apple’s market share has gone down and down and down.
But Apple has now put together an enviable track record at selling multimedia hardware and services. The iPod is a huge hit and the iTunes service is off to a great start.
It’s not hard to imagine that Apple executives will stare at the financials and draw an obvious conclusion: swallow their pride, bail out of the computer business, and follow the money. Apple’s got undeniable skills in making cool devices and great interfaces, and the media world is looking for somebody who can get consumers excited about the convergence of computers and media. Who would be better for making the box that sits in the living room and delivers audio, photos, and video to the home entertainment center? Or perhaps the ultimate handheld video device. Or any of a dozen other things, none of them full-function computers.
That’s not something that will happen abruptly – but if iTunes continues to make money, watch for signs that the company is shifting its emphasis, more or less subtly.
