The Music business at Apple

Faced with slow, flat sales of 'computers' and declining sales of peripherals, in 2000 Jobs noted the Napster attempts to 'free music' and he set Jon Rubenstein on a quest to look into 'what might we do?"

Napster, ruled illegal in summer 2001, gave Jobs an opening.  When the iPod launched at MacWorld in January 2002, Jobs confidently predicted that he'd sell 1 Million in a year.  Faced with a barrage of ciriticism, in fact only 339,000 machines sold.  Undaunted, and still in the aftermath of the dot.com meltdown, at MacWorld 2003 Jobs proclaimed this dismal sales record as a 'wild success' (never mind his prediction of the prior year), and he showed the next version, announcing that it would sell 2 million in 2003.

Alas, it did less than half of that, at 939,000 units.  Meanwhile, iMacs languished as well, and Apple continued with flat sales and virtually no profits.

At this point, Jobs intro'd yet a third iPod.  And voila, it worked, and when it hit, strangely, it gave a coat-tail ride to the iMac line, which was much higher priced, and profitable.  The corner was finally turning, circa Xmas 2004:

The stage was finaaly set -- in 2005, Jobs would find that the iPod lifted iMac sales, and it went viral itself.  They've never looked back.

But wow -- what tenacity, what perseverance, and what a gentle Board and shareholders to let him.