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Apple working on digital albums, tablet PC: sources

By Yinka Adegoke Yinka Adegoke – 21 mins ago

NEW YORK (Reuters) – The major music labels are planning a new digital album format that will debut with a tablet-like personal computer from Apple Inc in September, people familiar with the plans said on Monday.

The labels are attempting to revive the multi-track album format with new software that packages songs, traditional album liner notes, music videos, and other interactive extras as part of a premium-priced package.

The music industry first proposed the idea of an enhanced album format to Apple in 2007, according to two people who said the labels have been separately working on a project code-named "CMX".

The labels, including EMI Group, Sony Corp's Sony Music Entertainment, Vivendi's Universal Music Group and Warner Music Group had planned to roll out the new album format to all digital retailers this November.

But Apple decided to design its own version of an interactive album, which is expected to be launched with its new unnamed tablet-like device this fall, the sources said.

The Apple album project is expected to work with other Apple devices like the iPhone and iPod.

Industry sources said Chief Executive Steve Jobs would likely unveil the new device at an Apple event in September.

The partnership between Apple and the music labels is tinged with irony as it was the technology company that effectively marked the end of the multitrack album format in 2003, when it opened up its iTunes Music Store.

In early negotiations, Jobs made the labels agree to allow customers to buy any individual track they wanted from an album, in a bid to simplify the purchase process.

But record companies are desperate to breathe new life into the album format, which was responsible for the vast majority of profits when sales were primarily in compact discs.

All music companies have seen their revenues plummet as fans who buy music online choose the 99 cent-priced track they want rather than invest in an album which is typically priced around $8 to $10.

The new interactive format would be sold at a higher price than digital albums now.

(Reporting by Yinka Adegoke; Editing by Richard Chang)

U.S. business ignores largest disposable income market

Feel sorry, very sorry for business in the U.S.A. Feb. 19, 2009, the First Brats, Malia, 10, and Sasha (Natasha), 7, Obama jumped up and down at The Kids’ Inaugural held in Washington, D.C., on the eve of their father’s coronation as president.

Other than Disney, businesses seem to have NO clue how to market to tweens. The concert featured Miley Cyrus opening the show and the Jonas Brothers closing. In between were Demi Lovato, Corbin Bleu and Bow Wow.

Lovato, Jonas, Cyrus, Bleu – all on Hollywood Records, which manages most of Disney’s stars. Bow Wow is on Sony.

It appears labels like Sony, Warner Bros and all the majors have missed the tween market. Hollywood Records exploits it well through its Disney affiliation. Add Aly & Aj, Hilary Duff, Vanessa Hudgens, Hayden Panettiere, Jordan Pruitt, The Cheetah Girls and soundtracks. The key to tween music is Radio Disney. This is tweens’ biggest marketing tool.

Radio giant Clear Channel ignores the tween market. Granted, all the Disney tween stars market their concerts through Clear Channel’s Live Nation, yet Clear Channel’s radio stations leave the tween market to Disney. That’s equivalent to Toyota, Honda, etc. leaving truck sales to Ford; wouldn’t happen. Even the auto industry is ignoring tweens.

Disney utilizes ABC television on Saturday mornings, Disney and Disney Family. They know media and how to reach tweens.

This is the largest marketing segment in the world. I saw a guy about 50 with two tween daughters at the mall; bags of Hollister in their hand (Why always Hollister? Inadvertently marketing to tweens through older sisters?). Tweens own the wallets of the latter-day baby-boomers.

Look at Malia and Sasha. Their dad now makes half-a-million a year. They got a concert with their favorite stars, Jonas Brothers and Miley Cyrus. Tweens get what they want from their parents. From a disposable income perspective, tweens represent the largest audience, segment or group.

Here’s the future, too. You can bet the Obama Brats have iPods. When they are 15, they will have iPhones. Apple owns these children. Have never understood Microsoft’s recent campaigns about “I’m a PC.” Yet I do understand the future of laptop computing – and that is computing’s future – belongs to Apple. Microsoft targets geeks. Apple is targeting tweens through iPods and iPhones. Microsoft is confusing. Every three years you need to buy a new computer to get the latest operating system. With Apple, you update, not replace.

The U.S. is going to lose its financial future due to companies ignoring tweens