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At MidemNet last week, Apple iTunes head Eddy Cue claimed: "My daughter will not buy a CD in her lifetime."
It is certainly difficult to see why someone would want to buy a CD and a download of the same recording. Some iTunes customers are continuing to buy whole albums, but many more are cherry-picking their favourite tracks. So, sales of music via download shops may be more than 100% substitutional--10 [pounds sterling] spent on downloads results in more than 210 less being spent on CDs.
The problem is that iTunes only represents a slight development of the traditional business model with a new format to replace CDs. But this time there will be no sales bonanza as people replace their collections ,as you can rip iTunes from your existing CDs.
Furthermore, as Steve Jobs has already admitted, the iTunes business model is not viable in its goal right and is a loss leader for their iPod business. What happens when there is a conflict between the interests of the music business and the real ...