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Fatal Board · VIDEO ESSAY

The Tragic End of the iPod: The $100 Billion Apple Giant That Ruled Music, Then Destroyed Itself

Subscribe to the channel! https://www.youtube.com/channel/UCb0ps9eCp0y6yP1Xg4sDDFw?sub_confirmation=1 In 2005 the police commissioner of New York had to explain a number to the city transportation board: fifty iPods stolen inside the subway system that year, against zero the year before. Nobody was scanning pockets. They were reading a cable. White meant iPod, and iPod meant a hundred to five hundred dollars sitting in a coat, visible from the far end of a moving carriage. This is the full story of how the iPod ruled music, built a hundred billion dollar business out of a white box and a white wire, and was then destroyed twice — on purpose — by the company that made it. It starts in Tokyo in February 2001, when Apple's hardware chief Jon Rubinstein was shown a 1.8-inch hard drive that Toshiba's engineers had built and could not place. Five gigabytes, half the power draw of a laptop drive. Rubinstein's answer: "Yeah, I know exactly what to do with that." Eight months later the iPod went on sale — 10 November 2001, $399, a thousand songs in your pocket. Then the iTunes Music Store on 28 April 2003: 200,000 songs at 99 cents, a million sold in the first week, two billion by January 2007. Then the silhouette posters that made a white cable the most valuable accident in consumer marketing. Then the lock: a song bought from Apple played on an iPod and almost nothing else. Then the executions. On 7 September 2005 Apple discontinued the iPod mini — its best-selling product, the one shops could not keep in stock — and replaced it with the nano. Ten weeks later it revealed it had prepaid $1.25 billion to five flash memory manufacturers. It had bought the world's flash before the nano ever reached a shelf. On the same stage that same afternoon, Apple and Motorola showed the ROKR E1, the iTunes phone with a firmware limit of one hundred songs. The iPod's greatest year came after its replacement had already been announced. Fiscal 2008: 54,828,000 iPods, $9.15 billion, with 22,121,000 sold in the December quarter of 2007 alone. On 9 January 2007 Steve Jobs had already described "a widescreen iPod with touch controls, a revolutionary mobile phone, and a breakthrough internet communications device." He put the iPod first. He named the weapon after the victim. What almost nobody says is that the iPhone is not what killed it. Apple sold more iPods in the twelve months after the iPhone launched than in any year before. What finished the iPod was a sentence Jobs gave Rolling Stone in December 2003: "The subscription model of buying music is bankrupt." On the morning he said it, he was right. Spotify opened on 7 October 2008. By 2015 streaming had passed permanent downloads in the United States — $2.407 billion against $2.328 billion — and Apple Music arrived that same year, seven years late. The iPod touch was discontinued on 10 May 2022. Around 450 million machines, almost all of them now in a drawer. But the click wheel is on your wall inside a Nest thermostat, the 99-cent single is why every streaming payment on Earth is counted per track, and the white earbud outlived the machine it came in: Apple's wearables and accessories business took in $37 billion last financial year — four times the iPod's best year ever, from the cheapest thing that used to come free in the box. TOP SOURCES Apple Newsroom, "The music lives on" — the discontinuation of iPod touch, 10 May 2022, with the Greg Joswiak quote — https://www.apple.com/newsroom/2022/05/the-music-lives-on/ IEEE Spectrum, "From Podfather to Palm's Pilot" — Jon Rubinstein on the Toshiba 1.8-inch drive in Tokyo, February 2001, and the hotel conversation with Steve Jobs — https://spectrum.ieee.org/from-podfather-to-palms-pilot Apple Newsroom, "Apple Announces Long-Term Supply Agreements for Flash Memory" — the $1.25 billion prepayment, 21 November 2005 — https://www.apple.com/newsroom/2005/11/21Apple-Announces-Long-Term-Supply-Agreements-for-Flash-Memory/ RIAA, "News and Notes on 2015 RIAA Shipment and Revenue Statistics" — streaming $2.407bn / 34.3% against permanent downloads $2.328bn / 34.0% — https://www.riaa.com/wp-content/uploads/2016/03/RIAA-2015-Year-End-shipments-memo.pdf Apple Newsroom, "100 Million iPods Sold" — 9 April 2007, "the fastest selling music player in history", 2.5 billion songs sold — https://www.apple.com/uk/newsroom/2007/04/09100-Million-iPods-Sold/ This channel is made by an enthusiast who loves business and technology history — nothing more. All videos are for educational and entertainment purposes only and reflect my personal views and interpretations. I research each story carefully using publicly available sources, but errors or omissions can happen. Nothing here is professional, financial, or legal advice, and this channel is not affiliated with, endorsed by, or sponsored by any company mentioned.

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In 2005 the police commissioner of New York had to explain a number to the city transportation board: fifty iPods stolen inside the subway system that year, against zero the year before. Nobody was scanning pockets. They were reading a cable. White meant iPod, and iPod meant a hundred to five hundred dollars sitting in a coat, visible from the far end of a moving carriage.
This is the full story of how the iPod ruled music, built a hundred billion dollar business out of a white box and a white wire, and was then destroyed twice — on purpose — by the company that made it.
It starts in Tokyo in February 2001, when Apple's hardware chief Jon Rubinstein was shown a 1.8-inch hard drive that Toshiba's engineers had built and could not place. Five gigabytes, half the power draw of a laptop drive. Rubinstein's answer: "Yeah, I know exactly what to do with that." Eight months later the iPod went on sale — 10 November 2001, $399, a thousand songs in your pocket.

Then the iTunes Music Store on 28 April 2003: 200,000 songs at 99 cents, a million sold in the first week, two billion by January 2007. Then the silhouette posters that made a white cable the most valuable accident in consumer marketing. Then the lock: a song bought from Apple played on an iPod and almost nothing else.
Then the executions. On 7 September 2005 Apple discontinued the iPod mini — its best-selling product, the one shops could not keep in stock — and replaced it with the nano. Ten weeks later it revealed it had prepaid $1.25 billion to five flash memory manufacturers. It had bought the world's flash before the nano ever reached a shelf. On the same stage that same afternoon, Apple and Motorola showed the ROKR E1, the iTunes phone with a firmware limit of one hundred songs.

The iPod's greatest year came after its replacement had already been announced. Fiscal 2008: 54,828,000 iPods, $9.15 billion, with 22,121,000 sold in the December quarter of 2007 alone. On 9 January 2007 Steve Jobs had already described "a widescreen iPod with touch controls, a revolutionary mobile phone, and a breakthrough internet communications device." He put the iPod first. He named the weapon after the victim.
What almost nobody says is that the iPhone is not what killed it. Apple sold more iPods in the twelve months after the iPhone launched than in any year before. What finished the iPod was a sentence Jobs gave Rolling Stone in December 2003: "The subscription model of buying music is bankrupt." On the morning he said it, he was right. Spotify opened on 7 October 2008. By 2015 streaming had passed permanent downloads in the United States — $2.407 billion against $2.328 billion — and Apple Music arrived that same year, seven years late.
The iPod touch was discontinued on 10 May 2022. Around 450 million machines, almost all of them now in a drawer. But the click wheel is on your wall inside a Nest thermostat, the 99-cent single is why every streaming payment on Earth is counted per track, and the white earbud outlived the machine it came in: Apple's wearables and accessories business took in $37 billion last financial year — four times the iPod's best year ever, from the cheapest thing that used to come free in the box.

TOP SOURCES
Apple Newsroom, "The music lives on" — the discontinuation of iPod touch, 10 May 2022, with the Greg Joswiak quote — https://www.apple.com/newsroom/2022/05/the-music-lives-on/
IEEE Spectrum, "From Podfather to Palm's Pilot" — Jon Rubinstein on the Toshiba 1.8-inch drive in Tokyo, February 2001, and the hotel conversation with Steve Jobs — https://spectrum.ieee.org/from-podfather-to-palms-pilot
Apple Newsroom, "Apple Announces Long-Term Supply Agreements for Flash Memory" — the $1.25 billion prepayment, 21 November 2005 — https://www.apple.com/newsroom/2005/11/21Apple-Announces-Long-Term-Supply-Agreements-for-Flash-Memory/
RIAA, "News and Notes on 2015 RIAA Shipment and Revenue Statistics" — streaming $2.407bn / 34.3% against permanent downloads $2.328bn / 34.0% — https://www.riaa.com/wp-content/uploads/2016/03/RIAA-2015-Year-End-shipments-memo.pdf
Apple Newsroom, "100 Million iPods Sold" — 9 April 2007, "the fastest selling music player in history", 2.5 billion songs sold — https://www.apple.com/uk/newsroom/2007/04/09100-Million-iPods-Sold/

This channel is made by an enthusiast who loves business and technology history — nothing more. All videos are for educational and entertainment purposes only and reflect my personal views and interpretations. I research each story carefully using publicly available sources, but errors or omissions can happen. Nothing here is professional, financial, or legal advice, and this channel is not affiliated with, endorsed by, or sponsored by any company mentioned.

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Subscribe to the channel! https://www.youtube.com/channel/UCb0ps9eCp0y6yP1Xg4sDDFw?sub_confirmation=1 In 2005 the police commissioner of New York had to explain a number to the city transportation board: fifty iPods stolen inside the subway system that year, against zero the year before. Nobody was scanning pockets. They were reading a cable. White meant iPod, and iPod meant a hundred to five hundred dollars sitting in a coat, visible from the far end of a moving carriage. This is the full story of how the iPod ruled music, built a hundred billion dollar business out of a white box and a white wire, and was then destroyed twice — on purpose — by the company that made it. It starts in Tokyo in February 2001, when Apple's hardware chief Jon Rubinstein was shown a 1.8-inch hard drive that Toshiba's engineers had built and could not place. Five gigabytes, half the power draw of a laptop drive. Rubinstein's answer: "Yeah, I know exactly what to do with that." Eight months later the iPod went on sale — 10 November 2001, $399, a thousand songs in your pocket. Then the iTunes Music Store on 28 April 2003: 200,000 songs at 99 cents, a million sold in the first week, two billion by January 2007. Then the silhouette posters that made a white cable the most valuable accident in consumer marketing. Then the lock: a song bought from Apple played on an iPod and almost nothing else. Then the executions. On 7 September 2005 Apple discontinued the iPod mini — its best-selling product, the one shops could not keep in stock — and replaced it with the nano. Ten weeks later it revealed it had prepaid $1.25 billion to five flash memory manufacturers. It had bought the world's flash before the nano ever reached a shelf. On the same stage that same afternoon, Apple and Motorola showed the ROKR E1, the iTunes phone with a firmware limit of one hundred songs. The iPod's greatest year came after its replacement had already been announced. Fiscal 2008: 54,828,000 iPods, $9.15 billion, with 22,121,000 sold in the December quarter of 2007 alone. On 9 January 2007 Steve Jobs had already described "a widescreen iPod with touch controls, a revolutionary mobile phone, and a breakthrough internet communications device." He put the iPod first. He named the weapon after the victim. What almost nobody says is that the iPhone is not what killed it. Apple sold more iPods in the twelve months after the iPhone launched than in any year before. What finished the iPod was a sentence Jobs gave Rolling Stone in December 2003: "The subscription model of buying music is bankrupt." On the morning he said it, he was right. Spotify opened on 7 October 2008. By 2015 streaming had passed permanent downloads in the United States — $2.407 billion against $2.328 billion — and Apple Music arrived that same year, seven years late. The iPod touch was discontinued on 10 May 2022. Around 450 million machines, almost all of them now in a drawer. But the click wheel is on your wall inside a Nest thermostat, the 99-cent single is why every streaming payment on Earth is counted per track, and the white earbud outlived the machine it came in: Apple's wearables and accessories business took in $37 billion last financial year — four times the iPod's best year ever, from the cheapest thing that used to come free in the box. TOP SOURCES Apple Newsroom, "The music lives on" — the discontinuation of iPod touch, 10 May 2022, with the Greg Joswiak quote — https://www.apple.com/newsroom/2022/05/the-music-lives-on/ IEEE Spectrum, "From Podfather to Palm's Pilot" — Jon Rubinstein on the Toshiba 1.8-inch drive in Tokyo, February 2001, and the hotel conversation with Steve Jobs — https://spectrum.ieee.org/from-podfather-to-palms-pilot Apple Newsroom, "Apple Announces Long-Term Supply Agreements for Flash Memory" — the $1.25 billion prepayment, 21 November 2005 — https://www.apple.com/newsroom/2005/11/21Apple-Announces-Long-Term-Supply-Agreements-for-Flash-Memory/ RIAA, "News and Notes on 2015 RIAA Shipment and Revenue Statistics" — streaming $2.407bn / 34.3% against permanent downloads $2.328bn / 34.0% — https://www.riaa.com/wp-content/uploads/2016/03/RIAA-2015-Year-End-shipments-memo.pdf Apple Newsroom, "100 Million iPods Sold" — 9 April 2007, "the fastest selling music player in history", 2.5 billion songs sold — https://www.apple.com/uk/newsroom/2007/04/09100-Million-iPods-Sold/ This channel is made by an enthusiast who loves business and technology history — nothing more. All videos are for educational and entertainment purposes only and reflect my personal views and interpretations. I research each story carefully using publicly available sources, but errors or omissions can happen. Nothing here is professional, financial, or legal advice, and this channel is not affiliated with, endorsed by, or sponsored by any company mentioned.

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