The Los Angeles Times reported that Apple has been in talks for months with Vivendi, with the discussions recently centering on Apple acquiring the business outright. With annual sales of about $6 billion, Universal Music Group is the largest of the five major record companies, commanding approximately 23 percent of the market as of 2001, according to the company.Since the iPod is probably Apple's most appealing product, getting into the music business might not be such a horrible idea, especially since Apple has plans to launch its own digital music service. Stockholders, however, seem to disagree; Apple's stock is down over 8% on the news.
At the very least, Apple should have a better understanding of what PC users want out of a digital music service than the recording industry. Unfortunately, what PC users want and what's profitable for a record label may be two very different things.