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iTunes slays Japan's Oricon
"The iPod has outrun us all"

By Reuters

Published: Wednesday 01 November 2006

Oricon on Wednesday announced its exit from Japan's PC music download market, becoming the first victim among local players to the surging popularity of Apple's iTunes music store.

Oricon, best known as a publisher of music hit charts, will instead post links from its website to online music stores and concentrate on music downloads for mobile phones, which are far more popular than PC-based downloads in Japan.

An Oricon spokesman said: "The iPod has outrun us all. If iPod users could download music from our site, we may have waited to see if the tide turns from mobile phones to online downloads."

Oricon's online download store for PCs has been losing about $213,900 per month since its launch in March 2005. Raising its monthly download volume of 90,000 tunes and turning a profit would be impossible in the near term, the spokesman said.

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But even the market-leading iTunes store holds only about five per cent of the online song distribution market in Japan, where music lovers opt to download tunes to mobile phones from phone operators such as Japan's KDDI.

Apple doesn't disclose its market share or download statistics in Japan.

The online music market is forecast to grow 26 per cent to $249m in 2006 from the previous year, according to the Digital Contents Association of Japan. That's still a fraction of the $1.9bn market estimated for mobile phone downloads.

Music distribution and copyright practices in Japan also make it difficult to get a good line-up of Japanese pop music, the spokesman added.