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iTunes iPlummets, iPods iBreak

Forrester Research mark a dramatic decline in iTunes sales; iPod owners are getting increasingly angry with how they're treated by the Cupertino company.


Forrester Research have completed a 27 month survey of credit card transactions which shows a dramatic decline in the use of Apple's iTunes service. Since January Apple's monthly revenues have fallen by 65%, the number of monthly transactions by 58%, and the average size per purchase by 17%.

And profit, if any, on iTunes sales is anaemic in the best possible of all cases: with hosting, song, and transaction costs there can't be much left.

Seasons Greetings. Of course Apple deny all but will not go into detail. But it's the player itself that has increasingly vociferous consumer groups up in arms.

Criticism of the iPod started back with the Neistat brothers who three years ago launched a campaign to get Apple to recognise the first of many issues with the MP3 player: its battery ran out and the overall design didn't allow for battery replacement.

Casey found out about the 'iPod's dirty secret' the hard way: first he took his iPod to an Apple store; then he called Apple Care; then he sent his iPod to Steve Jobs himself. In all three instances he was told Apple did not replace iPod batteries and he should instead purchase a new unit.

Casey Neistat and his brother Van painted over iPod ads across New York City informing passers-by that the iPod's battery was scheduled to run down in 18 months and could not be replaced.

Because of pressure from Casey and Van Niestat, Apple finally gave in and initiated a battery replacement programme, but wary consumers still questioned how Apple could be so arrogant as to package an 18 month battery in a hermetically sealed device.

Since then the list of issues with the iPod has only grown - and geometrically it would seem - which can't be a good sign for Apple who today rely on the product for significantly more than half their corporate revenues.

Shonky

Australian consumer portal CHOICE Online have just awarded the iPod a not so coveted 'Shonky' for 2006.

An iPod is a significant investment, so you don't want your APPLE to be a lemon. And if there is something wrong with it, you'd expect an easy repair and warranty service. Podluck.

Level 1. Several readers complained about cracked screens, faulty batteries and problems with sound reproduction.

Level 2. APPLE don't allow retailers to handle complaints under warranty (which is their obligation under Fair Trading laws) - you have to send your faulty iPod to APPLE yourself via Australia Post. And if they decide the fault isn't covered by the warranty, you'll have to foot the entire bill.

Dealing with iPod Illness

'At any given time there are hundreds of busted iPods up for grabs on eBay, their owners anxious to recoup a few dollars for a now useless piece of hardware', write the Canadian Leader-Post.

'The average cellphone lifespan is 18 months and they expect their consumers to trade up the phones', said consumer researcher Andy Walker interviewed in the story. But Chris Kierney of Apple Defects does not agree.

I for one don't consider the iPod disposable like a cell phone. Cell phones are often free with the purchase of some monthly plan whereas iPods cost hundreds of dollars, plus even more money for the music.

'I gotta think Apple are making them cheap and fast and they gotta have an internal that says the product is going to have a shelf life of X years', adds Walker.

And as expected Apple are in complete denial, claiming the devices are failing not because they're made 'cheap and fast' but because of 'consumer abuse'.

'Consumer abuse is an issue so we try to make our product as rugged as possible', says Apple's Willi Powell, adding that dying batteries are merely a limitation of current technology - an assertion the Neistat brothers proved wrong three years ago.

'Error 1418'

And it's not just hardware issues. Jeremy Porter of 1418hell.com is not exactly pleased his iPod has suddenly stopped working - because of a software issue.

'On 12 September 2006 Steve Jobs unveiled the latest and greatest from Apple: new iPods and a significantly upgraded iTunes which included new features such as Coverflow and downloadable movies. As is usual with Apple software releases, many users downloaded the upgrade as soon as it became available and plugged their iPods in', recalls Porter. 'This is where the problems began.'

Things started with a flaky firmware update and progressively got worse, culminating in the now infamous 'error 1418' diagnostic.

'What are Apple doing about it?' asks Porter. 'In short, only they know. Since the problem appeared they haven't said a word despite the many thousands of their customers who have been affected. They have simply refused to acknowledge the issue and customer calls to their support department have ranged from fruitless to frustrating. Meanwhile thousands of users the world over can't use their iPods, have lost data, and spent days trying to make their iPods do what they should: play music.'

Porter lays it on the line for Apple.

What do we want? Firstly, Apple need to acknowledge the issue. Secondly, a response as to what they intend to do and explain how this error slipped through their testing process. Thirdly, we want our iPods to work again. Many of us don't want to be forced into buying new iPod Shuffles - we want our previously perfectly good iPods to work and be functional. Ideally those of us who had data on those iPods would like that data back.

People need to be aware that Apple are not recognising this fairly significant failure to their customer base. Apple's bread and butter is the iPod market. For years they were the underdogs punching above their weight, but with the mass popularity they now enjoy in popular culture they are seemingly untouchably cool. As they haven't addressed the issue yet it's up to disgruntled users to mobilise and force their hand.

It's apparent that only through action and community Apple will actually take notice, acknowledge the issues and resolve the problems many of us have.

See Also
Rixstep: iPod Therefore iPay
CHOICE: The iSHONK for Dual-level Shonkyness
AppleInsider: Are Apple's iTunes music sales plummeting?
The Register: iTunes sales 'collapsing'
BBC News: Apple deny download sales fall
Leader-Post: Dealing with iPod Illness
Neistat Bros: iPod's Dirty Secret
Jeremy Porter: Error 1418 - Fix Our iPods!

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