The iTunes Store turns 13 year old today, having originally opened its virtual doors on April 28, 2003 — back when 50 Cent’s “In Da Club” was riding high in the music charts, Anger Management and Bulletproof Monk were in theaters, and Saddam Hussein had just been ousted from power.
Who could’ve guessed that, years later, it would become the largest music vendor in the world, with well over 25 billion songs sold worldwide? Steve Jobs, that’s who!
Check out Jobs’ original unveiling of what was originally called the iTunes Music Store below.
The iTunes Store was highly significant. It provided a good legal alternative to the trend of music downloading as epitomized by the likes of Napster, Kazaa, and others. In 2002, illegal downloads had helped drive CD sales down by around 9 percent. Jobs’ idea was to sell digital songs for 99 cents, which would make them an impulsive purchase on the part of users — prefiguring the micro-payments we see in the App Store today.
Conventional wisdom at the time was that users were downloading free music because it was saving them money. By making a success of iTunes by offering a better service than the likes of Napster, Jobs demonstrated that customers were doing it because it was the quickest and easiest way to get music — and that, given a superior legal alternative, customers could be convinced to use that instead.
It also served as a demo of something that would be a hallmark of Jobs’ return to Apple: his ability to negotiate seemingly impossible deals. In this case, Steve convinced the heads of the top five record companies to sell their songs on iTunes, for royalties equalling 70 cents out of every purchase.
“I’ve never spent so much of my time trying to convince people to do the right thing for themselves,” he told biographer Walter Isaacson. Jobs’ rivals, meanwhile, were dismayed by the development. “How did [Apple] get the music companies to go along?” a senior exec at Microsoft wrote in an email the day he first saw the iTunes Store.
Of course, while Steve was correct about iTunes, he wasn’t right about everything in this area. Watching the above 2003 keynote today, it’s hard to ignore the line, “We think subscriptions are the wrong path” — particularly with Apple Music having just announced that it has passed 13 million paying subscribers.
Ultimately, iTunes is on the decline here in 2016 — as a growing number of users switch to streaming media services, providing on-demand video and audio that was only just beginning to be made available in 2003. But what a legacy it’s left behind!