Retailers unfazed by threat from iTunes
Bien Perez and Jennifer Cheng
Traditional music and video retailers are unfazed by the competition from Apple's newly launched online iTunes Store in Hong Kong.
HMV, the British entertainment retail chain, said its stores had continued to thrive despite the existence of various paid and free online music stores worldwide for many years.
'We've already moved on from just selling CDs and depending on music sales,' Emily Butt, the managing director for HMV in Hong Kong and Singapore, said yesterday. She pointed to its sales of books, DVDs, video games and hardware including media players.
Butt pointed out that the iTunes Store launch in multiple Asian markets was expected. The digital media store's regional operation had been limited to Japan, Australia and New Zealand since its 2003 launch.
'For HMV, we'll have to wait and see how the local market responds to this development,' she said. 'More than anywhere else in the world, people in Asia don't think they should pay for digital downloads.'
The iTunes Store was launched yesterday in 12 Asian markets, but mainland China and India - two huge markets where software piracy remain rampant - were excluded.
Apple said China - comprising the mainland, Hong Kong, Macau and Taiwan - became its second-largest market after the United States, with a record US$13 billion in sales in its fiscal year ended September 24.
Gary Leong Wai-ho, who owns the independent music retailer White Noise Records in Causeway Bay, welcomes the prospect of iTunes as another channel for marketing. 'Having your music featured on iTunes is a good idea for artists,' he said.
He does not expect CD sales at his store to be affected. 'I've heard from others that people who buy CDs and those who buy music online are two different clientele group ... if you buy songs online, you wouldn't visit a store like mine to buy CDs anyway,' Leong said. 'I would say online music buyers are a group of customers that I don't even know about yet.'
And Leong says nothing can beat buying music from a record store. 'The collection of music on iTunes is still very limited. They probably have at most only half of the world's music,' he said. 'And you're not really supporting the artist if you buy a song or two online. The monetary transaction is so miniscule that all the profit will probably just go to iTunes.'
But Neha Dharia, an analyst at market research firm Ovum, says iTunes will hit traditional music retailers. 'There has been a move towards digital music within the countries in Asia, and Apple's entry into the market will only intensify the pace of that shift,' Dharia said.