The NPD Group has released amazing numbers this week: Apple is generating one quarter of all US music sales. Equally impressive, but less surprising, is that Apple is also responsible for 69% of all online music sales.

Wal-Mart is #2 for US music sales at 14% (that's a combination of both their online and CD sales) and Best Buy is third. Speaking of CDs, the aging format is still the overall top seller in the US and Wal-Mart is the top CD distributor. However, NPD expects that Apple's sales will equal that of CDs by 2010.

I know it's impossible to say what I'm about to without sounding like a grumpy old man, but here it comes anyway. For me, the tremendous thing isn't that Apple has commandeered the market so handily, it is the rate at which the distribution model has evolved. I'm only 38 years old, but as a kid I had a box of records. By the time I was in junior high school I was buying cassettes and in college I bought CDs.

Today, I can't remember the exact last time I bought music in a format I could physically hold in my hands. I'm glad the big wigs in the music industry are starting to get it. Now if only the TV execs would follow suit.

Kevin Rose is at it again, with a brand new round of rumors about iTunes 8, supposedly premiered next week at the big Apple iPod event. Did I miss the meeting where we all declared him king of iPod rumors? King or not, he's got what he claims is inside information, including a writeup about something called the "Genius" sidebar, which creates recommended playlists for you, a new grid view (like Delicious Library?), and a new music visualizer.

Additionally, Rose's tipster mentions HD TV shows in the iTMS, and reiterates the previous rumors of new IPod nanos and Touches. None of these things are a huge surprise -- while the Genuis system will certainly be interesting to see (and make fun of) if real, HDTV and the new iPods are old news in Rumorville by now.

Is it OK if we hope for some faster and easier iPhone syncing with a new version of iTunes as well? Whatever is coming next week, we'll find out all about it then.

I was just as much a naysayer as Dave was when the service first came out (and for the record, I haven't used it all either), but apparently there are lots of people who do use Apple's "Complete My Album" service in iTunes -- the NYT says that it has become a prime selling tool, especially for bands and labels that pre-release singles from their album in a digital format. A whopping 52% of Lil Wayne's latest album sales on iTunes were sold through the "Complete My Album" feature. That means half the people who bought the album on iTunes had previously purchased one of the singles, and clicked through that way to buy the rest of their music.

And though neither Dave or I use "Complete My Album," that's a good sign for consumers, and a nice wake up call for the record industry -- the days of playing a song on the radio to up album sales are over. Digital releases are what sells music, and though "Complete My Album" currently only works on music previously purchased in the iTunes store, Apple could very easily extend that to all music in iTunes -- if you like a song that you've downloaded as a free single from the artist's website, it's just as easy to find music of theirs to buy in iTunes the same way.

We're done with a world where radio airplay determines what sells at the record store. These days, consumers are the ones who tell record makers what they want to buy -- it's already in their iTunes playlists.

Last week, Apple's iTunes Store turned 5 years old. Now the blogosphere is buzzing with the fact that Apple said they had over "10 million" songs in their library, then later changed the page to say "6 million." That's a difference of 4 million songs unaccounted for. MacNN did the math and said that if they had 10 million songs, it would have accounted for a 66% increase in their catalog in only a month. MacNN has before and after pictures of the iTunes Store page showing the changes.

So... typo? Or is Apple doing some weird shuffling of their library?

[via MacNN]

Whenever new technology reportedly meets the iTunes store, it's prudent to check Apple's online storebag protocol to see what's what. Today, I downloaded the latest storeBag.xml from Apple's public iTunes server. What I found was this:

There appears to be a new service, labeled "p2-panda" that offers access to the same functionality that Cory reported on last night. Specifically, the panda calls include StoreFront listings, Genres, Top Fifty listings, and Updates. If nothing else, this independently confirms functionality seen from those screen shots.

At this time none of the calls appeared to function--whether from a Mac or from an iPhone--but I do not have access to the AppStore software itself, only to the protocols and web browsers. I'll try testing periodically in case the services pop back online.

Update: p2 likely refers to Purple 2, the iPhone code name. (Thanks Ryan)

Update 2: iPhone developer asap18 reports that the AppStore allows users to search for iTunes music as well as applications. This leads him to believe that AppStore extends the core iTMS functionality on the iPhone.

The ongoing NBC Universal v. iTunes slap-fight has just become well, more slap happy. As reported in Daily Variety, Jeff Zucker (the President and CEO of NBC Universal), revealed some of the details of the NBC/iTunes impasse in an interview with the New Yorker's Ken Auletta.

Some of the highlights:

• In the last year, NBC U reported only $15 million in revenue from the deal with iTunes
• NBC U programming accounted for 40% of iTunes video sales
• NBC did want to experiment with higher pricing, albeit for only one show and on an experimental basis, but Apple refused.
• NBC U also wanted a cut of Apple's hardware sales (presumably iPods) to supplement revenues from the iTunes Music Store.

I'm sure it was just a coincidence that these remarks were given on the day of the launch of the Hulu.com beta, NBC's attempt to answer iTunes.

Issues of profit sharing and price flexibility aside (I'll refrain from sharing my own opinions regarding those issues), the conclusion I find most interesting in this saga is that Zucker's figures (along with figures Apple has reported in the past) back up what many analysts have been saying all along: demand for television content via iTunes is pretty underwhelming. Think about it, NBC says they made only $15 million in revenue off of media sold via iTunes last year; even in the softening TV on DVD market (where the cost per episode is on average, the same, for the consumer), that's peanuts compared to retail revenues of those same shows.

Additionally, if NBC represents 40% of all iTunes video sales, and assuming that the other media companies have a similar revenue split agreement with Apple, that would put total revenues by the content providers for the video/TV sector of the iTMS at approximately $38 million. Strictly looking at the situation in those terms, I can understand why media companies might be reticent to offer up their programming on iTunes. I mean, really, what's the point? If the content is going to be essentially given away, web-based services like Hulu make a lot more sense.

The Beatles are now on iTunes-- kind of. George Harrison has become the last solo Beatle to be added to the iTMS, as iTunes now carries all of his solo work (including "Got My Mind Set on You"-- enjoy having that in your head for the rest of the day). That means that all the Beatles have now had their solo work added to the online store. There's John, Paul, now George, and that other guy. If you want them all, it's gonna take money, a whole lot of precious money. It's gonna take plenty of money, to do it right child. Stuck in your head yet?

And yet we still wait (well, most of us do) for the Beatles as a whole to appear on iTunes for purchase. It's become a kind of mythical event, hasn't it? Someday, the heavens will break open, earthquakes will rend the ground under our feet, and the world will end around us, but hopefully not before we can buy the White Album at the ITunes store.

Thanks, Eric!

NBC has gotten all the press in their big fight with Apple, but a few other companies are currently considering their options about what to do with iTunes pricing.

News Corp is apparently ready to draw a line in the sand. Their COO Peter Chernin says "negotiations will be prickly and dicey and contentious, like all negotiation are and like all negotiations should be." Interesting point of view there. He earlier promised that they wouldn't be pulling content from iTunes like NBC is (or at least says they are-- the content is still there for now, but on the way out soon), but says that they should be the ones determining prices for their products, not Apple. Which is true-- unless Apple believes otherwise. If Apple offers you $1 per song or nothing, Chernin, which one are you going to take?

And CBS, on the other hand, is asking everyone to just chill, OK? CEO Les Moonves is the only one that actually sounds like he knows what's going on at the iTunes store: "We look at iTunes as much as a promotional vehicle for our shows as a financial vehicle." That's exactly how everyone should see it-- we can watch these shows for free (with advertising) on television, or pay a nominal fee to watch them later on iTunes.

This doesn't help with NBC of course-- they're going to do what they want (including go to Amazon) no matter what CBS says. They are competitors, after all, but whether NBC pulls out or not, the Store isn't going anywhere-- there are lots of content providers still interested in it.

[via MacBytes]

Over the past couple of days, we've received reports here at the TUAW home office (located in the seaside town of Ocean City, MD; excellent taffy) of multiple download problems in purchasing music at the iTunes store. While the transaction completes as far as billing is concerned, the actual file downloads... don't. Users are getting connection errors and the file never seems to arrive. In addition to the reader reports, a couple of us have seen the problem firsthand.

There are several threads on Apple's discussion boards covering the issue, and most seem to converge on the suggestion that a large download queue may be behind the problem, or a single corrupt song that blocks further downloads. If doing a manual check for purchased and undownloaded music doesn't solve the problem, Apple's download support page for iTunes recommends submitting a problem ticket within your iTunes purchase history; this should allow the customer service agent to clean your queue and improve your download experience. For worldwide customers, the main directory for iTunes support is here.

For what it's worth, late Wednesday night I bought an album that downloaded cleanly and quickly, but obviously people's mileage is varying. With the level of attention brought to the iTunes store by the NBC withdrawal and the iPod product announcements, this is not the time for Apple's technical execution to falter; the iTunes Store didn't get to be the #3 music retailer in the USA by stalling customers in the checkout lines. We'll keep an eye on the trouble reports and see how things progress.

P.S. One year ago, the iTunes store was down for a good reason...

Thanks to everyone who sent this in.

You may not be able to buy the Beatles' music as a group from iTunes, but you can buy most of the member's solo stuff. Lennon, McCartney, and now Starr. That's right, Mr. Conductor's music is available on iTunes including Photograph: The Digital Greatest Hits (which is an iTunes Plus album).

One more thing to note about Ringo, other than he has the best name our of anyone in the Beatles, is that he is a Mac user. I was poking around his personal website, and stumbled across his photography section. Those certainly look like Photo Booth pictures to me.

Thanks to everyone who sent this in.

Imagine all the people... downloading John Lennon's songs. It isn't hard to do-- John Lennon's music is now available on the iTunes store as of last night. Right around 3AM, reader Ricky (thanks!) saw the graphic above pop onto the store, and noticed that Working Class Hero, among other albums, had arrived, and then disappeared about half an hour later. He speculated that they were working on a full release today.

And he was exactly right-- Apple has announced that sixteen of Lennon's solo works are now for sale on the iTS, including the "digital debuts" of the Lennon Legend and Acoustic collections. Additionally, for the next 30 days, six of the albums will include exclusive video content-- Working Class Hero looks like it has a "Give Peace a Chance" video on it, and Imagine includes a video for the classic title track. And all of the albums are available not only regular price ($.99 a song), but also at iTunes Plus prices, which means $1.29 a song, but completely DRM free.

First Paul McCartney, now Lennon, and the Beatles has to be just around the corner. Power to the people, right on!

Thanks, Ricky and Zack!

In response to the rumor of videos in to the iTunes UK store, our friends at Download Squad did a little poking around and found something else that might be imminent: games for the iPhone. (Official ones, that is-- there are already quite a few for the iPhone)

Inside the iTunes localisation strings, is the following sequence:

/* ===== iPhone Game Item Strings ===== */
"4329.001" = "Are you sure you want to remove the selected game from your iPhone?";
"4329.002" = "Are you sure you want to remove the selected games from your iPhone?";

This basically confirms that Apple is bringing games to the iPhone. The only question, however, is: Which games? Are we going to get more Sims Bowling (ugh), or will Apple's new friends at id actually hook them up with something cool?

I'll leave it at this: if Apple can get Doom on the iPhone faster than the hackers can, I'll finally cave in and pick one up. Of course, that's a win-win proposition-- no matter what happens, iPhone-owners will be playing Doom. But if Apple wants my money, I want some games worth playing in return.

Another hurdle on the way to an eventual Beatles-on-iTunes debut has been cleared. Today, ContactMusic reported that Apple Corps has settled with EMI over unpaid royalties. Apparently, this ongoing dispute has been one of the issues that has blocked online digital distribution of Beatles tracks. This settlement may allow EMI to distribute Beatles songs online in the near future. If so, you may soon see the Beatles showing up in iTunes. It's been a long and winding road and we're still not near the end.

Thanks Jeff Kirk & everyone who sent this in.

I spent some of my lazy holiday Monday pondering an appropriate response to Randall Stross's article (not clearly billed as either news or opinion) in Sunday's New York Times entitled Want an iPhone? Beware the iHandcuffs, a fairly... odd interweaving of gripes about the 'lock-in' factor of the iTunes Store, starting with his contention that FairPlay is 'crippleware.' He's taking that term from the delightful Tucker vs. Apple lawsuit, which should give you a hint where he's coming from on this one.

Stross (who also wrote a fine item in 2005 about why Sony didn't build the iPod) has some basic points: DRM bad; iTunes Store has DRM; look at Plays for Sure and all the Microsoft customers that got rogered; iPhone bad; eMusic and other unencumbered music sales online, good.

While I have no real love for FairPlay, and I do worry that my iTunes purchases might not survive future device changes, I couldn't quite put my finger on the core bogosity of his thesis. As is often the case in the Mac-blogosphere, John Gruber got his opinion out of his brain with more speed and pith than I could muster:

You can "pledge a lifetime commitment to the iPod" and never once come into contact with a FairPlay-protected song or video. If you don't like FairPlay's restrictions - and there are plenty of good reasons not to - then don't buy any, and rip your music from regular CDs.
iTunes Store music and video locks you in. iPods and iPhones do not.

Gruber is right, but I would say (after the needed pondering) that he doesn't go far enough.

More after the break...