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U2 Joshua Tree Tour 2019
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U2 online deal hastens last spin for the CD

Posted on Saturday, October 30 @ 09:27:32 CEST by Macphisto
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(Timesonline.co.uk) -- Apple shares soared by £1 bn over its special edition iPod and digital box set for the Irish groupy
THE new album by the rock veterans U2 is called How To Dismantle An Atomic Bomb. An alternative could have been How To Kill The Compact Disc And Make Two Billion Dollars.

That may be what the Dublin quartet have achieved since Tuesday by signing an unprecedented joint marketing and licensing deal with Apple, the Silicon Valley firm behind the iTunes online music shop and the iPod digital music player.

Shares in Apple climbed vertiginously close to an all-time high yesterday after a week of excitement on Wall Street about the deal. That means Bono, The Edge, Adam Clayton and Larry Mullen Jnr effectively added $2billion (£1.1billion) to the stock market value of the company.

It also makes their online music deal by far the most lucrative signed by any rock band in history.

The deal will see Apple release a black, U2-branded edition of the iPod player and offer an exclusive 400-track “digital box set” of all the band’s albums. The U2 iPod is expected to be released in Britain in the middle of next month. The new U2 album, meanwhile, will be in the shops on November 23.

Asked if the Apple deal meant the beginning of the end of the CD, Paul McGuinness, the band’s manager, said: “Oh yes, but it’s happening anyway. Having said that, the entire legal downloading business is still only 3per cent of the total. And the digital box set is only really available to those with broadband, or high-speed, internet. It’ll be pretty pointless with dial-up.”

There are fears, however, that the commercial venture could backfire on a group known for their Christian-inspired lyrics and outspoken views on everything from Aids in Africa to Third World debt.

Some fans feel cheated that the band is getting so corporate. Apple’s latest iPod advertising campaign, meanwhile, features U2 performing their new single, Vertigo — in what could be construed as the band’s first commercial endorsement. The Vertigo video was broadcast exclusively for 24-hours on America Online’s Music First View service. On the Slashdot website, one fan called the $349 U2 iPod “the most expensive U2 album yet ”.

U2’s deal with Apple is yet another knee to the groin of the traditional music industry, which suffered a steep 7.1per cent decline in CD sales last year. The band’s total CD sales, including such classics as The Joshua Tree and Achtung Baby, stand at 120million. According to Apple, more than 5.7million iPods — critically lauded as the “Walkman of the 21st Century”, despite battery lifespan problems — have been sold since they were released in 2002. Although rival players have been released, Apple still has nearly two thirds of the market. Meanwhile, the launch of iTunes last year as the first legal music downloading website helped to double the value of online song sales to $270million (£147million). Online sales are forecast to reach $9billion (£5billion) by 2005. Rivals, including Bill Gates’s Microsoft Corporation, have tried to take business away from Apple, but so far with limited success.

The black U2 iPod will come with a $50 (£27) voucher for the digital box set, which will be sold via the iTunes service for $149 (£81).

Mr McGuinness said the deal was no different from any of U2’s other promotional activities. “We’ve always done ‘co-op’ advertising, which means we share the cost of advertising with music retailers, be it iTunes or Tower Records,” he said yesterday. “Apple didn’t pay us to be in the Vertigo ad. It would be a lot different if we were selling Coca-Cola. As for the black U2 iPod, it can be seen as just another piece of U2 merchandise.” He added that the money made by the iPod would not be going to charity.

Mr McGuiness said: “That’s something we wouldn’t discuss anyway.”

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