Apple Itunes Record Label In 2009

Its time for someone to say what the current label system is afraid of hearing, Apple Itunes should launch its own label in 2009.

We would all have to agree that Apple stands for true innovation in technology and has proved it time and again. The current label system has a lot of frustration with Apple because they have the feeling Apple is nothing but a veritable monopoly on digital music and digital downloading. The question I have here is what do the labels have to offer as innovation?, all of the labels have shown they will stop at nothing to squelch new technology at every corner and at the same time continue to prop up a very quickly dying and archaic business model.

Here is where Apple launching a Digital Label makes sense, ITunes currently has 70% of the market place even with the introduction of Amazon, Yahoo, and the talk of Qtrax putting up its advertising based peer-to-peer model.

What the competition does not have is the IPod, On April 2007 it was announced that Apple had sold its one-hundred millionth IPod, making it the biggest selling digital music player of all time. The competition also doesn't have one of the biggest innovations to date in cellular the Iphone, essentially a veritable consumer store front in your pocket. This device was the most talked about device in the market to date in 2007 and has proved to be an amazing device.

To take a quick stab at the competition, Amazon is nothing but the digital equivalent of Wal-Mart selling everything and anything to consumers, not to put Amazon down but music is not the main focus its just another item to sell. Qtrax is an unproven model but if the major labels are behind it, it wont be very innovative and you will have to give something up to get the musc. Yahoo is such a small blip on the radar screen and if the music division was so successful 1000 people would not be losing jobs in the coming weeks ahead.

Apple has all the elements necessary to put together the biggest label in the world and fully control the industry in 2009.

1 Distribution- This is more than a store front, ITunes is a compete distribution center able to deliver an unlimited amount of tracks at anytime, thus eliminating the middle man from this process. This is a true crux the current label system could never figure out how to overcome and lost anywhere between 15-20 percent in revenue that went out the door year after year. It's hard to compete with instant distribution with no inventory.

2 Marketing & Branding- It's unarguable that Apple is the leader in branding itself, with the power of the ITunes brand, launching an ITunes label would send a fire storm through the industry. I often hear that ITunes needs the labels more than ITunes needs them, this is false. Without ITunes the labels would have been closer to the inevitable demise and fate they are heading for, without Apple we would probably only have two labels left. The current label system is nothing but a clearing house for music much like the old Columbia House 10 Tapes for a penny system that were used for promotion in the 1980's. They simply have nothing to offer, proof that branding is out of reach for the current labels , the example of the biggest album of 2007 Josh Groban's Noel. This is proof they serve no purpose in branding anymore for an artist if this is the best album to come from four major labels in 2007.

3 Store Fronts-Apple has over 100 million email addresses at their disposal and worldwide storefronts all available at your finger tips. This is a huge consumer base and growing every day, not to mention when Apple launches ITunes China they will have a billion consumers to target that love western music and will have to have an IPod or Iphone to play it on. This is another element taken out, brick and mortar record stores, there is no need to get in the car waste gas and wait in a line. Digital music also helps with the environment, no more plastic discs littering our landfills and taking up unnecessary space, also less dust in the house also means less allergens in the air, this should make soccer moms happy that each time they purchase a digital track they are helping the environment for children world wide.

4 Radio- With 100's of millions of people with ITunes on a desktop, it might be safe to say ITunes radio is one of the biggest and most listened to radio stations in the world. With the upcoming merger of Sirus and Xm, Apple could partner with them and have one of the widest radio reaches in the world. We all know that traditional terrestrial radio will soon be a thing of the past, unless you enjoy listening to adds 30 min an hour and listening to senseless morning shows during your commute, they forgot about the music, people want choice or they would not be buying these services. Not to mention this would eliminate payola from the radio market.

5 Signing Artists to ITunes- If you have never seen a major label contract before you would have to ask the question, who was the brain child behind this? It's the most skewed one way document ever written and takes a legal team to even come close to understanding it. An ITunes label contract could be so simple, 50-50 for ITunes and the artist. Apple could have a fair contract with the artist and gain 50 of all revenue in the process, with the power of the brand behind it; you know re-coupment will happen immediately, because every middle element will be out of the way. This would eliminate the last fraction from the music industry, the RIAA, with them out of the picture artists could then get back to making good music and let the marketplace decide if they deem it worthy of being purchased. It's a simple truth if people like the music they will buy it.

I will be posting part two of why Apple Itunes should launch a label in 2009 tomorrow, give as much feed back as you can on the subject I want to hear peoples opinions on the subject.

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Until Tomorrow

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Digital Mind !