Apple is “Top Dog” with iPod

As of September 2006 there had been a reported 67.4 million iPods sold worldwide along with 1.5 billion songs sold at iTunes. With more than 8 million iPods being sold each quarter, Apple is a force to be reconned with in the world of digital music players. In fact, just as Microsoft enters the fray with it’s new Zune, iPod enjoys a 10 to 1 lead over its nearest competitor.

Here are a few interesting statistics as released by Solutions Research Group back in July 2006:

    28% of Americans aged 12 and up own a digital music player, more than twice the 12% for 2005
    Apple has increased it’s share of the market from 53% to 68%
    45% of all internet users downloaded music. This is up from 31% a year ago.
    In 2005 only 8% of Americans paid for their song download. This year the number was up to 23%.
    Women aged 15-49 are the hottest growth demographic with 27% owning digital music players compared to 8% in 2005.

Now, even as Microsoft introduced Zune to the market in November, Apple is maintaining its strong lead in sales. According to Amazon.com, of the top 18 slots for digital music players, Apple owns 12 with various permutations of iPod while Microsoft is coming in at number 18. It is not a familiar position for Microsoft, a company that has a 90% market share in desktop operating systems.

Equally unfamiliar for Apple is being the “top dog” instead of the “underdog”. Apple has long experienced the fierce loyalty of its Mac brand community. This community has feasted on their resentment of Microsoft and the “forces of the Dark Side” that Windows has come to represent. O’Guinn and Muniz call this “oppositional brand loyalty”. The community is galvanized, in part, by their common enemy who, in the world of commerce, usually occupies a commanding percentage of marketshare.

In the case of the iPod, it is Apple that owns the market and Apple that is experiencing what it is like to be the reviled market leader. A rite of passage is being lambasted by the Wall Street Journal. Despite the fact that the WSJ notes that iPod owners, as a group, are more satisfied than owners of rival devices (82% to 76%) and despite an impressive defect rate of less than 5%, the Journal regales us with stories of iPods gone bad and notes that with all those iPods in the marketplace 5% is a lot of bad ipods. You know you have ‘arrived’ when your success is seen as a potential problem. In fact, no less a right-wing luminary than Bill O’Reilly has recently included the iPod in one of his ‘America is going to hell in a hand basket’ rants.

While it is still too early in the world of digital music players for a brand community to coalesce around a particular iPod competitor, the number of anti-iPod sites seems to be proliferating. Take for example SmashMyiPod.com. This site was originally set up to collect $400 in donations, go to an Apple store, purchase a new iPod, and smash it right before the eyes of the Apple faithful. Ironically the site seems to have been ‘assimilated’ and the preponderance of Google ads for iPods make it look more like a link farm.

Apple’s split personality presents all sorts of interesting questions. How does the Mac community feel about its young, upstart sibling ? Do non-Mac members of the iPod community feel any affinity towards their long-suffering, Mac brethren ? How has the success of the iPod affected the market for Macs ? How has the Mac reputation affected the growth and success of the iPod ? And, of no less importance, how does Apple segregate and/or integrate its two high profile brands ?

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