iPod Therefore I Win

Apple is touting its latest feat -- the sale of 100 million iPod devices.

And Apple has a lot to be proud of because this number two computer company has cleaned everyone's clocks in the five years or so that they have been on the market.

iPod just this week eclipsed the Walkman as the fastest growing music player. It took Sony 14 years to sell the same number of their cassette players with headphones.

Both the Walkman and iPod have changed the way people listen to music.

Walkman was the primitive iPod. It was analog in an analog world. Bulkier, but mobile back in the day. A Walkman was still small enough to carry around.

The iPod is digital in a digital age. It doesn't take a lot of brains to deduce that it was Walkman on steroids.

But think about it. Even with Apple's touch for high fashion design and master marketing skills, the iPod could have been just a smaller and prettier (and less successful) Walkman had it not been for two things:

The Internet.

And the major record labels.

The old boys at the original Napster can be proud that they and a lot of other rebels paved the way for iPod's success.

Had it not been for illegal downloading, Apple CEO Steve Jobs -- even with his hard-nose persuasion skills -- could not have sold the record labels his salvation plan to stop piracy. It was the labels fear of illegal downloading that helped Jobs convince them to make songs available to iPods on an a la carte basis for just 99 cents.

There's little doubt that they really regret it today for in the end Apple can take all of the credit for 100 million iPods sold but it was the record labels that created the monster by making iPod possible.

Now, the major record labels have lost control of Apple, Jobs and his iPod devices.

They can't strong-arm him into variable pricing although EMI got him to add 30 cents per download for DRM free tunes -- time will tell how brilliant this move was.

The labels can't return to selling albums because in enabling Apple (how can I put this delicately?) they destroyed the album as we know it.

And, they helped to create the "cherry picking" that consumers do when they buy from iTunes. Well, we over romanticize the album anyway. At best it's Sgt. Pepper's but usually it's buy one hit get the rest of the stiffs free. Good riddance to the album. Anyway, new "albums" are coming in the digital world -- not based on how many songs a disc can hold but how many tunes make an artistic statement.

What's sticking in the craw of the labels is that while their brick and mortar record stores were declining, they helped Apple build a bigger and potentially more powerful record store online.

If iPod is the car, iTunes is the gas station. Apple could be Exxon-Mobil!

Are the labels just stupid or did they really do all of this to themselves?

Well, lots of record execs feel that they did it to themselves. But they shouldn't be so negative. Every decision the labels made was by thinking defensively. Every decision Apple made was the result of thinking offensively.

You figure out which strategy usually works and which one does not.

Now, the labels are stuck with Jobs and his 100 million devices.

If many record execs were not already driven to drink, research tells us that the majority of these 100 million iPod owners are still first time buyers. My God, even Apple didn't know how big this thing would get.

They certainly are careful in babying their little moneymaking device.

Notice you won't find AM or FM radio on it -- very uncool.

No satellite radio -- what's satellite radio to an iPod user?

You've already no doubt noted the timing on the iPhone introduction as Apple swoops in and enters the mobile market with the number one music device just when the mobile operators are trying to expand their presence in the mobile music business.

And dare I say, wait until the time is right and Jobs makes the iPod a WiFi-enabled device. This juggernaut may never stop.

So, thank you record labels for becoming the bitch of a computer company.

Actually, you did a good thing and you can get in on all of this as soon as you stop fretting over the loss of your old business model. You still have time to do deals with Jobs -- although you've lost control and he will call the shots. Apple still needs you, but if you wait too much longer, you'll blow your chance.

So, call the RIAA and cancel the legal strategy. It isn't working anyway. Think different (sorry about that). Think big. Bold. Brave.

Come on in, the digital revenue is a moneymaker for Apple but not for you.