EMI will long for yesterday on iTunes
Apple’s iPod may have been the best thing to happen to music since The Beatles. But the two icons have never officially collaborated, as the Fab Four remained one of the last downloading holdouts. Four decades after the band broke up and seven years since Apple launched its iTunes music store, the long and winding road has finally reached its digital destination.
The trademark litigation that held up the move won’t suppress the hype of the overdue migration. Apple boss Steve Jobs is among the band’s legions of fans of all ages. And since his company uses music, movies and software mainly as a way to attract consumers to buy its gadgets, The Beatles proved a noticeable absence.
Apple will suffer a little financially for the tardy arrival of the catalog that includes “Hey Jude” and “Yellow Submarine.” Although it essentially runs iTunes on a breakeven basis, the marketing power of the best-selling band of all time would have proved more valuable earlier in the life of the online shop. After all, according to research outfit NPD, Apple already can claim a 70 percent market share for all paid music downloads.
The bigger loser will be EMI. Though online sales aren’t as profitable as CDs, Beatles fans have shown themselves loyal buyers of new versions of old songs. But with more than 175 million albums sold in just the United States, many consumers have now had ample time to shrug off iTunes and convert those recordings into digital form themselves.
That means once all the initial hoopla dies down, EMI’s private equity owner, Guy Hands’ Terra Firma, will still need plenty of help climbing out from its under heavy debt load. Sure, iTunes will deliver a long-awaited and much-needed fresh revenue stream. But as EMI resumes its restructuring fight with lender Citigroup, it’s not just The Beatles who will long for yesterday.