Filed under: Analysis / Opinion, Multimedia, Rumors, iTunes, Steve Jobs, Apple
iRecord Company rumors resurface again
Rumors have been bouncing around all weekend about Steve Jobs' next big project-- no, it's not the iPhone Nano, or the long awaited iTablet. According to Moli.com (yeah, we've never heard of them either), it's a record company. Supposedly Jay-Z and Beyonce are going to Apple to start a recording division. Just imagine HOVA in this picture wearing blue jeans with his black shirt tucked in.Frankly, farfetched is too nice of a word to describe this rumor, but the idea of an iRecords isn't that new or ludicrous. Obviously, SJ's got issues with the folks standing between him and musicians, and putting musicians under his own wing would allow him to digitally distribute their music DRM-free, and collect all the profits for himself. There's blood in the water around the recording industry, and the time is ripe for someone to jump in and take over.
Of course, this is Apple, so there's more to the story than that-- their first battle would be convincing Apple Records to come to some kind of agreement. Then there's the actual music management function of it-- Apple's great at serving consumers, but would they be able to serve the function of a record company in terms of promotion and booking? Digital distribution is super (and it definitely cuts down on costs), but no one's buying your music if no one's heard of it.
Then again, SJ managed the content producers at Pixar just fine, and if he has a little help (the Moli report says Apple has hired a publicist from Capitol Records), things might just turn out OK after all. I doubt Jay-Z and Beyonce are really involved, but if His Steveness decides to form a record company, he might just put the last nail in the traditional recording industry's coffin.
Thanks, Pat!
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Reader Comments (Page 1 of 1)
Pez said 6:40PM on 7-16-2007
Steve was pretty hands off at Pixar, showing up once a month to dump more money into it at the request of senior management there. Steve wanted to see Pixar develop software, not animation. Hell, Steve really didn't even bring anybody on board after he bought it from Lucas (whom was against selling, but had no choice in the face of an ugly divorce), so you can't even say that he chose good people to do the work for him. So let's not give him too much credit other than bankrolling the whole thing.
I'll vote Bullshit on this rumor.
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G said 7:12PM on 7-16-2007
Apple has got the promotion down. Of course, what happens when they can't simply focus on one hardware item every few months, but need to constantly promote several artists who have singles and albums being released? And record labels don't book artists. Last I heard, that was actually illegal in California (though no one really cares). They can arrange promotional gigs here and there (TV shows, etc.). One important function which large labels still do is bribe radio station 'promoters' to play their music, yes even after all of the recent hubbub about that. A third party takes care of the legalities. I don't see Apple getting into this disgusting side of the music business while radio is still the cesspool that it is, and still has the ears of many music consumers. It would make more sense for Apple to start there...
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dashiel said 7:34PM on 7-16-2007
this is such an obvious step for apple i've been calling it for years (another reason that $140 per share is a bargain for their stock price).
everyone knows that apple has been steadily climbing the charts and is now the #3 seller of music. they will overtake best buy and walmart by the end of 2008.
what people haven't noticed so much is apple stealth move in to becoming a taste-maker. the songs they choose for their ads, for their free single of the week etc... have produced some pretty big hits over the years. now obviously it's not just apple doing it, but i can point to at least a dozen artists who were unknown when apple used their music or released a track as a free download and went on to become big stars.
radio airplay is rapidly losing its influence as a taste-maker to advertising and myspace like environments. it was this taste-making ability that was the last stronghold of the RIAA and related corporations. once that rug is pulled from under them and apple claims the number one spot in sales those companies will be gone within a decade*
it's still too early. apple needs the number one spot, and needs to quietly start promoting their success in hit making. also think that despite their popularity and jay z's business acumen neither of them are big enough or diverse enough in their appeal to start a label with. apple will need someone like U2 or perhaps there was more to that secret, out-of-court settlement with apple records. apple also has to be careful because not all the pieces are in place yet, moving too soon would scare of the movie studios (not that apple has much of a chance of replacing them), but universal might be pressing the issue with their contract hardball.
doesn't matter this is happening, and just watch the artists flock to apple as they announce terms like 50/50 royalty split. more money for apple, a lot more money for the artist and no bullshit record company interference.
at&t/verizon/sprint/etc... should pay attention, because they're next.
* they do have one slim chance for survival, but they're too dumb to figure it out, and too arrogant to implement if someone told them what to do.
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G said 7:47PM on 7-16-2007
Yep, I agree that radio is losing its influence. And rightly so. But it's also happening very slowly. We've been saying this since the turn of the century in eager anticipation. Hopefully sooner than later, though!
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Sean said 8:27PM on 7-16-2007
Apple Records already sold all rights to their name in the settlement reached between them and Apple Inc. Apple can at any time start up their own record label called "Apple," and Apple Corps would actually have to license their own name *back* from Apple Inc.
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Darren said 10:47PM on 7-16-2007
I've always thought this is the way Apple should go. Apple makes money selling hardware, not selling music. iTMS was invented to make the iPod more attractive and to legitimize MP3 players in general.
Apple's largest cost with iTMS is appeasing the copyright-holders/record companies.
I've always thought that Apple should become the record company. Sign acts, lots and lots of acts, give away their music to iPod owners (or sell it for a nominal fee). With all their customers using iPod/iTunes they can collect purely fair and accurate information of how popular song and artists are, and divy up royalties that way.
Plus, it wouldn't be very difficult for Apple to provide a better deal to artists than the Major Labels; artists have been getting ripped off from day one.
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Photo Tim said 1:58PM on 7-17-2007
Jay Z has wanted to run his own record company for some time. He was in talks about taking over the helm at Sony Music. This could be rumor, but don't discount it. If it's true, the music business will wish they only had 99 problems.
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Steve Mills said 4:30PM on 7-17-2007
Well that's pretty gross. Why them instead of real musicians?
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Sam G. said 5:22PM on 7-17-2007
I, too, vote bullshit on this rumor. It's too much of a volatile, low-margin business for a computer company to want to take on, though I'm sure SJ could use a combination of his business smarts and his RDF to make it seem worthwhile.
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Frank Z said 10:48PM on 7-17-2007
This is only a matter of time. The music industry is ripe for the destroying. They've screwed themselves up by screwing people on both sides... the musicians and the fans. Apple can insert itself right in the middle because people buy from iTunes already. And if you'll also notice, there are alot of profitable unsigned bands out there that have used their own websites with direct communication to fans to get their stuff out. It's going to happen and it can't be soon enough!
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