Business Matters: iTunes Global Revenue Was $6 Billion In 2011

iTunes Preparing For Broad Latin American Launch

iTunes Preparing For Broad Latin American Launch

iTunes Global Revenue Was $6 Billion In 2011
-- Lost among some spectacular numbers in Apple's earnings release on Tuesday was a sign of impressive growth at iTunes. Global iTunes sales rose to $1.7 billion in the quarter ended Dec. 31. That includes sales of all content sold at the iTunes Store, from music to video and apps. iTunes' total for calendar year 2011 was roughly $6 billion, up about 55 percent from roughly $4.2 billion in calendar year 2011 (Apple's first fiscal quarter is the fourth quarter of the calendar year).

Starting with the fiscal second quarter of 2010 (period ended March 27, 2010), here is iTunes revenue for the last 8 quarters, according to statements by Apple executives during earnings calls: $1.1 billion, over $1 billion, over $1 billion, over $1.1 billion, almost $1.4 billion (the period that included Christmas 2010), almost $1.4 billion, almost $1.5 billion and $1.7 billion (in the period that included Christmas 2011).

Apple executives did not break out iTunes quarterly revenue in earnings calls prior to March 2010. When the company discloses iTunes revenue, it offers a broad number, such as "almost $1.1 billion" or "exceeding 1.5 billion." For the purposes of calculating quarterly and annual comparisons, I've done away with "almost" and "exceeding" and rounded to the nearest 100 million.

These numbers show fantastic growth in iTunes' worldwide revenue in the last couple of years. A good apples-to-apples comparison is the last two quarters that included Christmas. iTunes revenue grew 43 percent to $1.7 billion in the quarter with Christmas 2011 from $1.4 billion in the quarter with Christmas 2010.

The iTunes catalog has grown mightily over the last two years, too. Apple claims iTunes had 20 million songs in the most recent quarter. Two years earlier, the company revealed in an earnings call the iTunes catalog was at 11 million songs. Not all songs are available in every market, however. As an example, many songs and albums are available in the U.K. but not the U.S., and vice versa.

Beyond Oblivion Debt Between $100-$500 Million: Report
-- Reuters has a post-mortem of sorts on Beyond Oblivion, the News Corp.-backed digital music startup that closed its doors before getting its product to market. A Chapter 11 filing at a U.S. Bankruptcy Court in New York lists debts between $100 million and $500 million. The two largest debtors are Sony Music Entertainment and Warner Music Group. Each is owed $50 million for "trade debt."

Beyond Oblivion raised $87 million -- $55 million reported to be contingent on goals and thus uncollected -- for a device-based subscription service. Similar to Nokia's Comes With Music, the idea behind Beyond Oblivion was to give consumers unlimited access to music for the life of a participating device. The price of the service would be absorbed by the manufacturer and incorporated into the price of the device (mobile phone, PC, whatever). That model required Beyond Oblivion to negotiate not just with rights owners but device manufacturers, too.

At this point in time, the leading subscription model is one that offers a web- or client-based experience as well as a mobile experience -- all on the device of choice. Rhapsody, Spotify, Rdio and Mog follow this model. Muve Music, the newish service from mobile carrier Cricket, exemplifies another model. Muve, which has grown to more than 500,000 subscribers in just one year, was built by Cricket to be bundled with its affordable, unlimited talk, text and web plans.

Buzz Media Bulks Up Staff
-- Buzz Media has added three hires to help guide its portfolio of music-based online properties. Bill Jensen was hired as the newly created position of VP/GM of Music. Jensen was formerly the director of new media at Village Voice Media. Kim Persse has joined from AOL as the new director of music content and industry relations. Nicole Cullinane, the new executive producer of music programming, was previously at MTV Digital. Buzz Media's properties include the music blogs Stereogum, Idolator, Buzznet and PureVolume.
(Press release)