A Mixed Morning for Apple

Posted by: Stephen Wildstrom on July 02, 2007

There’s good news and bad news in Cupertino this morning.

The good, of course, is the iPhone launch, which could hardly have gone better. While it’s hard to figure out what analysts’ reports of sales of more than 500,000 units are based on, it is clear that Apple moved a whole lot of phones over the weekend. Ther pace of sales is likely to slow down because of supply shortages, especially of the muck more desired 8 gigabyte version, but that’s a problem anyone would happily have.

The bad news comes from Vivendi’s Universal Music Group, which announced that it does not plan to renew its license for the iTunes Store to sell its catalog of recordings. This could be a negotiating tactic, since it’s not clear that UMG can afford to give up what has become the largest retailer of music. But it could be a serious blow to the iTunes business strategy. The loss of Vivendiwould be a particularly embarrassing blow to Apple: They might still be able to sell the special-edition U2 iPod, but the Irish rockers’ music would no longer be avaialble from the iTunes Store.

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Reader Comments

dg

July 2, 2007 10:38 PM

I really am baffled by record companies. Do they ever consider the customer? If, for instance, a U2 fan can no longer get music where they want it, or have to pay more for it than other bands, for no particular reason other than record company weirdness, does that encourage them to "support" the rich artist and pay more money, or not even try anymore, and just download it from the vast array of free sources? And I wonder too, do record companies consider their artists? What kind of position does it put them in, but to start looking elsewhere for more fair distribution of their music?

I just don't get record company thought, or lack thereof.

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BusinessWeek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, Douglas MacMillan, and Spencer Ante dig behind the headlines to analyze what’s really happening throughout the world of technology. One of the first mainstream media tech blogs, Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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