London - The once iconic MP3 player that cemented Apple’s place in music history – and ultimately brought about the demise of Sony’s Walkman – is facing its own inevitable death.
According to the latest earnings report, Apple sold 6 million iPods during the last quarter, and although this was almost double the sales of the previous three months, this equated to a 52 percent drop in sales year-on-year.
Apple also lost 55 percent in revenue on all models of the music player, compared to the previous year, and the iPod now makes up just two percent of the company’s overall income. The drop in sales is being attributed to the increase in music apps, cloud storage and streaming services including Spotify.
Additionally, Apple iPhones come with iTunes built-in, making the iPod redundant for many iPhone owners.
The trend hasn’t been helped by Apple not having released a new version of the music player since the fifth-generation Touch and seventh-generation Nano launched in 2012.
Sales of iPods were at their highest during 2008 following the launch of the first iPod Touch at the end of 2007.
The iPod Touch was designed to look like an iPhone, played music and ran apps, but could not make calls. Similar sales were seen across 2009 thanks to the launch of the third-generation Shuffle, fourth-generation Nano and second-generation Touch.
Sales began to dip in 2010, but remained steady throughout 2011 and up to the third quarter of 2012, despite no new devices being launched during that time. The last quarter of the year is, traditionally, the best for sales across the Apple range because of the Christmas surge. With this in mind, sales of the iPod are expected to drop significantly over the next year. However, this hasn’t stopped other companies launching similar products, including Sony with its latest ZX1 refreshed version of its Walkman.
By contrast, Apple’s iPhone sales continued to rise with 51 million being sold over the holiday period – up seven percent year-on-year. A total of 26 million iPads were also sold during the same period, up 14 percent year-on-year. Yet the largest sales increase last year was for the Mac, which celebrated its 30th birthday with a 19 percent sales increase.
Despite the drop in iPod sales, this boost in other areas of the business resulted in Apple posting record-breaking profits of $13.1 billion profit on $57.6bn in revenue. This revenue is up $3.1bn compared to the same quarter last year.
Yet analysts had been expecting better, and following the earnings report call, shares of Apple stock plummeted by nine percent in after-hours trading. Analysts were expecting even bigger things and had predicted about 55 million iPhones. Apple’s stock had been rising on the expectation that the company would clear the hurdle. – Daily Mail