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Apple's 10-Year-Old iTunes Loses Ground to Streaming

A decade after its launch, Apple’s site is losing market share to competitors and streaming sites
Apple's 10-Year-Old iTunes Loses Ground to Streaming

A decade ago, the newly started iTunes Store gave away a song called Over My Head (Cable Car) by an obscure Denver rock group called The Fray. That was, explains lead guitarist Joe King, the band’s big break. “I’ll never forget, our manager e-mailed and said there had been 300,000 downloads,” says King. “Immediately our fan base went from several hundred to thousands, everywhere. Our tour started selling out.” These days, iTunes doesn’t offer that kind of overnight success for undiscovered musicians, despite its 435 million registered users.

Apple opened the iTunes Store on April 28, 2003, as a legitimate, industry-supported alternative to online music piracy, selling most individual songs for 99¢ a pop. It was the first venue to make digital music purchases mainstream. “Consumers don’t want to be treated like criminals, and artists don’t want their valuable work stolen,” Apple co-founder Steve Jobs said in a statement at the time. “The iTunes Music Store offers a groundbreaking solution for both.” Paired with Apple’s ubiquitous iPod music players and, later, iPhones, it quickly became the Internet’s de facto record store, accounting for nearly 69 percent of digital U.S. music sales at its peak in 2010, according to estimates from market researcher NPD Group.