According to the company’s most recent 10-K filing with the SEC, revenues from its iPod business have shrunk by more than 20 percent for its second fiscal year running, overshadowed by the company’s growing mobile and tablet revenues. The company brought in $4.4 million in iPod revenues for its fiscal 2013, compared to $5.6 million last year and $7.45 million two years ago.
The writing is on the wall: the iPod was big, but it’s not the Next Big Thing anymore.
Of course, that’s hardly surprising.
In much the same way that the computer market has taken a hit — thanks to the rise of tablets — the market for personal media players has sunk as people buy iPhones and other smartphones that also store and play music. As smartphones grow to encompass more of the overall cell phone market, there’s less and less incentive for people to pony up for an iPod.
Those people who want to have a dedicated music player already have one. And there doesn’t really seem to be a growing market in the personal media space. Given that, it seems likely that the iPod will continue to make up a declining percentage of Apple’s balance sheet.
As Apple has to choose how to allocate its engineering resources, especially as it plans to enter a “new product category,” it’s clear that the iPod just can’t be at the top of the totem pole, at least for financial reasons.