After researching Apple iTunes Music store and comparing it with other online movie databases, there are a few certain points of interest that I will need to investigate further.
Firstly, according to a website on mac statistics, the Apple US market share is between 3.53% and 4%. The global share by looking at the data I would say to be between 2.0% and 3.0%. While these numbers may seem low, this is a percentage share of the market that is locked in to using Apple’s iTunes download service on their platform. Others using PCs have the choice between various downloadable movie services such as CinemaNow, Movielink, Guba, Amazon Unbox and iTunes (http://www.techcrunch.com/2006/10/15/itunes-movies-v-the-rest/). When comparing the current iTunes service with these other companies, the first apparent difference was Apple’s lack of a rental feature. While all of the other sites allow users to rent new releases and catalog movies for fees ranging from as low as $0.99 (Guba) to the mostly standard $3.99, iTunes charges $14.99 for purchase of new releases and $9.99 for catalog movies. In reviewing the proposal for usage of a BitTorrent software to distribute movies, I want to investigate further the incentive for iTunes to offer 24 hour rentals (with a 30 day expiration date) as is standard and will be offered on the upcoming Bit Torrent Entertainment Network.
A major potential problem of Apple switching to the BitTorrent format would be the ability to encourage users to consistently upload all of their content. This would encourage more “seeds” in the system and hopefully attract more users to fill the network, thus providing faster download times. One possible incentive might be to provide rewards to users once they reach a standard number of uploads provided or time spent on the network. The goal would be to encourage users to allow others to download from them in hopes of increasing both the available content and download speeds on the network. The possibility of a free purchase after a certain amount of uploads contributed might discourage “freeloading.” Another incentive to attract more users could be a friend referral program. Under this program, users will get discounts for each new user that lists them as a referral to the network. This will hopefully result in more users, more content shared, and better downloads. More incentives will be researched…
I will also need to do more research on pricing strategies. Preliminary investigations show that iTunes prices for purchasing new and old movies are on par with the market. However, depending on the popularity of the new BitTorrent Entertainment Network, Apple may need to offer lower introductory prices to attract users to their network. To their advantage, many users are already familiar with the iTunes interface and the Music Store’s reliability. Hopefully their customer loyalty will continue if Apple were to choose to switch from its trusted format.
I will further investigate pricing strategies, yet will do so cautiously. The iTunes Movie Store’s main advantage is the ability for movies to be transferred to iPod video players. “According to Apple's quarterly financial results (from 2002 Q1 to 2007 Q1), total iPod sales reached 88,701,000 units as of January 2007. Apple's fiscal year ends in September. In January 2007, Apple reported record annual earnings of US$7.1 billion, of which 48% was made from iPod sales.[67]” The number of iPod users that are effectively locked in to Apple’s music and movie formatting will ensure a fairly uncompetitive market so long as they maintain their DRM. This being the case, Apple can benefit from not lowering its purchasing price even if others are slightly lower (on top of the fact that other movie download sites aren’t compatible with Mac formats).
Lastly, it may in fact be in Apple’s best interest to NOT switch to BitTorrent format. The success of the BitTorrent Entertainment Network is unproven. It remains to be seen how easily BitTorrent’s infamous legacy of piracy can be shaken off and how effectively it can convert users from sharing pirated content. Even its potential faster download times are suspect, with BitTorrent’s own Vice President stating, “the download time [of BTEN] is analogous to downloading from [Apple's] iTunes.” (http://www.pcmag.com/article2/0,1895,2098221,00.asp)
With download times being analogous, I feel it might be in Apple’s best interest do spend their time and money on creating a new piece of hardware that allows for better movie viewing (rather than the current small screened iPod video players). Couple this with their current iTunes Movie Store and add licensing from more studios. This could be a more effective way to increase profits by developing a new sector of the portable media market, much like they did with the advent of the iPod. My final conclusion will come as I continue to research.
As the Guru/ethicist of the group, I basically see my job as being to organize and put together this project. So far I have set up this blog and been in charge of emailing my group about upcoming deadlines/tasks. I plan on organizing a meeting for all of us later this week to sit down and put together the work we've all been doing separately.
A really important part of my job is going to be understanding everyone else's different fields. Not only would it be impossible to put together a report when I do not know what each person is talking about, but its also imperative that I understand so I can check to make sure their arguments and points are correct and work with each others.
I am also going to be looking into just what exactly a consulting report format looks like. I've found several websites with models/instructions as to just what they entail.
In terms of my role as an ethicist, I plan on discussing just what the groups opinion should be with Brady, our economist, and Hayley, our law expert. I think it'll be important to examine the beneficiaries of putting HD movies on itunes as well as what this could mean for the market in general. It will also be important to explore rulings from previous law cases to see what precedents have been set.
Overall, its going to be important for me to be on top of information and deadline dates, and extremely imperative for me to stay motivated for my group.
Law: I've been researching some of the cases we've spoke about in class. I need to delve a little deeper into most of them.
Additionally, I need to research HD movies and the implications of using distributing them online. What consequences will this bring for Apple? Will it be difficult to distribute HD movies because of DRM technology?
I am planning on doing more in depth work this evening, so more on this later.
My job as the Technical Liaison is to understand the idea behind BitTorrent and determine whether or not it makes sense for Apple to make use of it to distribute HD quality movies on a wide basis. While I have not really began any official research, I will need to study HD movies in depth to determine how they are different from the traditional DVDs used today. I will also need to research the differences between BlueRay and HD DVDs to determine which type makes the most sense to distribute. I plan on researching the size of these various formats to determine which one has the least effect on small file systems. I also plan on conducting some research to determine by how much BitTorrent increases the download rate. I will also have to locate any other viable solutions that could potentially be more efficient than BitTorrent. In order to do this, I will have to understand BitTorrents underlying structure to make a viable comparison. While I have not yet downloaded the BitTorrent client, I need to make sure that it works well and is stable all platforms that are supported by iTunes. We also need to determine whether or not there are any suitable open source HD players out there on the market that we can take advantage of and maybe improve to incorporate into our iTunes distributions.
4 comments:
Preliminary Economic Report:
After researching Apple iTunes Music store and comparing it with other online movie databases, there are a few certain points of interest that I will need to investigate further.
Firstly, according to a website on mac statistics, the Apple US market share is between 3.53% and 4%. The global share by looking at the data I would say to be
between 2.0% and 3.0%. While these numbers may seem low, this is a percentage share of the market that is locked in to using Apple’s iTunes download service on their platform. Others using PCs have the choice between various downloadable movie services such as CinemaNow, Movielink, Guba, Amazon Unbox and iTunes (http://www.techcrunch.com/2006/10/15/itunes-movies-v-the-rest/).
When comparing the current iTunes service with these other companies, the first apparent difference was Apple’s lack of a rental feature. While all of the other sites allow users to rent new releases and catalog movies for fees ranging from as low as $0.99 (Guba) to the mostly standard $3.99, iTunes charges $14.99 for purchase of new releases and $9.99 for catalog movies. In reviewing the proposal for usage of a BitTorrent software to distribute movies, I want to investigate further the incentive for iTunes to offer 24 hour rentals (with a 30 day expiration date) as is standard and will be offered on the upcoming Bit Torrent Entertainment Network.
A major potential problem of Apple switching to the BitTorrent format would be the ability to encourage users to consistently upload all of their content. This would encourage more “seeds” in the system and hopefully attract more users to fill the network, thus providing faster download times. One possible incentive might be to provide rewards to users once they reach a standard number of uploads provided or time spent on the network. The goal would be to encourage users to allow others to download from them in hopes of increasing both the available content and download speeds on the network. The possibility of a free purchase after a certain amount of uploads contributed might discourage “freeloading.” Another incentive to attract more users could be a friend referral program. Under this program, users will get discounts for each new user that lists them as a referral to the network. This will hopefully result in more users, more content shared, and better downloads. More incentives will be researched…
I will also need to do more research on pricing strategies. Preliminary investigations show that iTunes prices for purchasing new and old movies are on par with the market. However, depending on the popularity of the new BitTorrent Entertainment Network, Apple may need to offer lower introductory prices to attract users to their network. To their advantage, many users are already familiar with the iTunes interface and the Music Store’s reliability. Hopefully their customer loyalty will continue if Apple were to choose to switch from its trusted format.
I will further investigate pricing strategies, yet will do so cautiously. The iTunes Movie Store’s main advantage is the ability for movies to be transferred to iPod video players. “According to Apple's quarterly financial results (from 2002 Q1 to 2007 Q1), total iPod sales reached 88,701,000 units as of January 2007. Apple's fiscal year ends in September. In January 2007, Apple reported record annual earnings of US$7.1 billion, of which 48% was made from iPod sales.[67]” The number of iPod users that are effectively locked in to Apple’s music and movie formatting will ensure a fairly uncompetitive market so long as they maintain their DRM. This being the case, Apple can benefit from not lowering its purchasing price even if others are slightly lower (on top of the fact that other movie download sites aren’t compatible with Mac formats).
Lastly, it may in fact be in Apple’s best interest to NOT switch to BitTorrent format. The success of the BitTorrent Entertainment Network is unproven. It remains to be seen how easily BitTorrent’s infamous legacy of piracy can be shaken off and how effectively it can convert users from sharing pirated content. Even its potential faster download times are suspect, with BitTorrent’s own Vice President stating, “the download time [of BTEN] is analogous to downloading from [Apple's] iTunes.” (http://www.pcmag.com/article2/0,1895,2098221,00.asp)
With download times being analogous, I feel it might be in Apple’s best interest do spend their time and money on creating a new piece of hardware that allows for better movie viewing (rather than the current small screened iPod video players). Couple this with their current iTunes Movie Store and add licensing from more studios. This could be a more effective way to increase profits by developing a new sector of the portable media market, much like they did with the advent of the iPod. My final conclusion will come as I continue to research.
As the Guru/ethicist of the group, I basically see my job as being to organize and put together this project. So far I have set up this blog and been in charge of emailing my group about upcoming deadlines/tasks. I plan on organizing a meeting for all of us later this week to sit down and put together the work we've all been doing separately.
A really important part of my job is going to be understanding everyone else's different fields. Not only would it be impossible to put together a report when I do not know what each person is talking about, but its also imperative that I understand so I can check to make sure their arguments and points are correct and work with each others.
I am also going to be looking into just what exactly a consulting report format looks like. I've found several websites with models/instructions as to just what they entail.
In terms of my role as an ethicist, I plan on discussing just what the groups opinion should be with Brady, our economist, and Hayley, our law expert. I think it'll be important to examine the beneficiaries of putting HD movies on itunes as well as what this could mean for the market in general. It will also be important to explore rulings from previous law cases to see what precedents have been set.
Overall, its going to be important for me to be on top of information and deadline dates, and extremely imperative for me to stay motivated for my group.
Law:
I've been researching some of the cases we've spoke about in class. I need to delve a little deeper into most of them.
Additionally, I need to research HD movies and the implications of using distributing them online. What consequences will this bring for Apple? Will it be difficult to distribute HD movies because of DRM technology?
I am planning on doing more in depth work this evening, so more on this later.
My job as the Technical Liaison is to understand the idea behind BitTorrent and determine whether or not it makes sense for Apple to make use of it to distribute HD quality movies on a wide basis. While I have not really began any official research, I will need to study HD movies in depth to determine how they are different from the traditional DVDs used today. I will also need to research the differences between BlueRay and HD DVDs to determine which type makes the most sense to distribute. I plan on researching the size of these various formats to determine which one has the least effect on small file systems. I also plan on conducting some research to determine by how much BitTorrent increases the download rate. I will also have to locate any other viable solutions that could potentially be more efficient than BitTorrent. In order to do this, I will have to understand BitTorrents underlying structure to make a viable comparison. While I have not yet downloaded the BitTorrent client, I need to make sure that it works well and is stable all platforms that are supported by iTunes. We also need to determine whether or not there are any suitable open source HD players out there on the market that we can take advantage of and maybe improve to incorporate into our iTunes distributions.
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