Apple charging $10,000, barring indies from iTunes LP | iLounge News


Apple charging $10,000, barring indies from iTunes LP

Apple is not offering its new iTunes LP format to independent record labels, and is charging a handsome production fee for the creation of each release, according to a new report. An independent record label owner asked Apple what would be involved in making some of his label’s albums available in iTunes LP format, and an Apple sales representative replied that not only is the company not offering iTunes LP as an option for independent labels, but it is also charging a $10,000 production fee to create the files, putting the format out of reach for many smaller artists. iTunes LP was introduced by Apple alongside iTunes 9 at the company’s It’s Only Rock and Roll event on September 9; since its launch that day, the selection of iTunes LP offerings has expanded only slightly, going from 6 albums at launch to 13 today. [via Gizmodo]

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Yeah, this approach is really going to help digital downloads of full albums.

And you wonder why the music industry is turning against Apple. It’s not like the music industry doesn’t already have enough intrinsic problems from their own bad practices, now they have to contend with the technically number one music retailer in any format (and undoubted king of digital downloads) locking out indie labels completely and charging ridiculous entry fees to the majors just because they can get away with it.

The iTunes store is really well designed and, relatively speaking, comprehensive, but I really hope Amazon will step up their game and introduce some actual competition into this game. I accept that digital online distribution is the future, now I just wish somebody would get it right instead of offering these half-arsed compromises to the same thing we can get in physical media for less money in a majority of cases. There’s no real reason why digital distribution should be inherently inferior to physical media, but, for now, that is certainly the case, and Apple is just keeping the trend alive and well with moves like this.

Posted by Code Monkey on October 9, 2009 at 10:36 AM (CDT)


Did you hear that bang sound? That was Apple shooting itself in the foot.

Posted by Josh C. on October 9, 2009 at 10:51 AM (CDT)


this is why apple sucks.

Posted by JP on October 9, 2009 at 2:10 PM (CDT)


WTF!  Somebody expects Apple to do it for free.  I’m willing to hire any of you that are willing to work for below minimum wage and no benefits since most of you don’t value your own worth.  I doubt if any of you know what goes into the digital creation of the LP format.  The record companies also wanted to create their own LP format and what makes you think it would have been any less expensive.  I can’t say about indie artists not being able to have LPs created, but $10,000 for any top artist shouldn’t be much of a problem the way some of them throw around money.

Let’s face it, Apple’s got the only game in town and you either play it or leave.  You people think that a lot of artists aren’t going to play the digital LP format game, well, I think you’re wrong.  It absolutely will catch on and any real artist would love to put out a digital LP.  You people are just too narrow-minded to understand.  Along with your notions that an Apple tablet will not excite the average non-tech user.

Apple might suck, but it will control the digital format industry.  Just like Microsoft sucks and it controls the desktop computer industry.  Obviously, sucking is not an impediment to success.

Posted by iphonerulez on October 9, 2009 at 4:17 PM (CDT)


@iPhonerulez: 13 albums in total in the iTunes LP format screams loud and clear how much the industry thinks this is worth (aka not much).

The reason why $10K is ridiculous is that there wasn’t any real work that went into it. That’s how this came out, an indie label had looked into the format, seen how simple it would be to provide Apple with already packaged content, and got told to bug off, they weren’t interested in their business.

Apple may control the digital format industry, but so long as that industry continues to represent such a small percentage of the total music industry, and a barely significant percentage of album sales, they haven’t won the game yet.

Labels won’t leave Apple, they want those $1.29 single sales too much, but they’re not going to pony up $10K just for Apple to sell what amounts to the equivalent of a flash encapsulation of some jpegs and video clips until Apple shows they can actually move more albums digitally. It’s a classic chicken and egg problem and the labels have no reason to play this game when they’re working on their own format that I’m quite certain Amazon and others will be more than happy to sell for less than $10K a title.

When more than 80% of people are still choosing CDs over downloads, it’s no time to be this cocky.

Posted by Code Monkey on October 9, 2009 at 5:12 PM (CDT)


there is a real opportunity for a 3rd party to get in there and offer LP artwork for sale… that’s if you can input the artwork into itunes?

i would pay to have a catalog of cool artwork and liner notes in iTunes for cure, depeche mode, etc. but i’m not willing to repurchase all my cds again on iTunes for the privilege. so why not sell it separately?

Posted by umbertoaqualung on October 9, 2009 at 10:18 PM (CDT)


iLounge how about offering your services to indies and if you like undercut Apple say for $5k you would have a mint in no time.

Better still offer the service for free.

Posted by AdamC on October 9, 2009 at 11:42 PM (CDT)


I believe AdamC is confused.

iLounge doesn’t sell music and if that post is in any way aimed at me, I am not associated with iLounge in any way.

Anyhoo, you seem to miss the point: once you have a digital store in place like Apple does, you can sell, quite literally, any piece of digital data as easily as the next. It’s no more effort for Apple to deliver the digital “digipak” than it is for them to include the pdf booklets they’ve been doing with some full album sales for years.

The effort was in coming up with a containing file that locks away videos and pictures and uses some flash-like interactive animation to display the above along with the liner notes and such. Unfortunately, the key words in the above was “locks away”. There’s nothing particularly time consuming or difficult about the files themselves, only that Apple went out of their way to make sure they are locked down and only viewable in iTunes. My feelings about charging $10K a title aside, that’s just unbelievably stupid on the face of it. If you want to create an album experience for the modern age, you don’t do it by starting off from the premise that, barely a year after we finally were able to free digital downloads from the shackles of DRM, the next “big thing” is to create an album format that is locked down to a single iTunes account and only viewable within iTunes. It’s completely missing the point and whatever steps forward it allegedly takes, moves backward even more. Then on top of what must be a pretty hard sell to the music industry, you set the price at $10K/title just so they can deliver something the labels could be doing themselves if Apple wanted to play ball? Asking the labels, indie or major, to pay Apple $10K a title just so Apple can find a new way to lock down content to Apple & iTunes is a losing proposition on the face of it.

Posted by Code Monkey on October 10, 2009 at 7:12 AM (CDT)


iphonerulez makes the erroneous assumption that iTunes LP is the only game in town. In fact, my company, MusicOnlineAlive, will be introducing a ONLINE digital album format in a couple of weeks that is far more powerful, and flexible than iTunes LP and is available to any artist/record company at a fraction of the cost. Of course, we don’t have the marketing muscle of an Apple (yet), but from my point of view Apple has just proven that they have no interest in real artists, whereas our product is built for and from the point of view of artists—I know, because I am one.

Posted by Peter Saltzman on October 10, 2009 at 9:08 AM (CDT)


Maybe Apple knows something you don’t know.  That’s Macin’! Honestly!  Apple is protecting the smaller artists from the the misuse of it’s anti-piracy application.  Check the new user agreement for Genius, dated Sept. 9.  Apple has the right to “rein it in,” for profit.  As far as I know, Apple has always been the highest quality media available.  No one will unseat it.  Not this time.

Posted by Kathryn "KJ" Burnett on October 10, 2009 at 10:14 AM (CDT)


Are the consumers really interested in this stuff? I have one album from iTunes that has the liner notes/extras/PDF thing and I wasn’t impressed. I can’t even see the big dogs paying that much. Wasn’t the whole point of this to increase the sale of full albums? How many units of a particular title does a label have to sell before they break even on the Extras’ production cost?

Posted by Paul on October 10, 2009 at 6:08 PM (CDT)


“How many units of a particular title does a label have to sell before they break even on the Extras’ production cost?”

Well, in all fairness, selling digitally distributed albums is effectively 100% profit for the labels. Apple eats all the billing, electricity, and bandwidth costs from their 25% to 30% share of the costs and the labels take the other 70% to 75% of the cost as pure profit.

Yes, those fees in some cases might be going to pay back end costs for production, touring, etc., but there’s no additional cost for the iTunes sales, once you’ve mastered the music, it’s pretty much free money from that point out for digital sales when Apple pays all the overhead.

So, figure 10,000/.70, or around 15K copies before the labels start to see a profit after paying Apple to sell their album as iTunes LP. The question the labels must, of course, be asking themselves, is will they see significantly more than 15K additional sales from opting for iTunes LP versus just selling it “as is”.

Posted by Code Monkey on October 10, 2009 at 9:06 PM (CDT)


Most indies don’t care about full album sales. Most people don’t care about full album purchases. A digital LP doesn’t offer anything that can’t be done better with a dedicated blog for that release, and any indie can afford to set-up a blog. The digital LP is just to humor the old skoolers who are completely out of touch with modern marketing and distribution.

Posted by E.J. Sadler on October 11, 2009 at 10:36 AM (CDT)


“Most people don’t care about full album purchases.”

More than 80% of total music sales are still full albums, more than 90% of full album sales are still physical media.

Getting full album sales to switch from physical to digitally distributed IS the elusive magic bullet the music industry truly needs to keep with their outmoded pricing structure.

You are the one who’s out of touch.

Posted by Code Monkey on October 11, 2009 at 2:24 PM (CDT)


I have to agree with ‘Code Monkey’ in nearly all of this.  10K to essentially re-package the video and artwork?  Somebody obviously got out of bed on the wrong side and smacked their head in the wall and not recovered when they made that decision!  Seems my initial fear if this is going to end up turning into some way to sneak some form of DRM back in is turning out to be true.  They may not call it “DRM”, but well, a turd by any other name is still a turd, as far as I am concerned.

On more of the many reasons why I continue to tell iTunes to pretty much “stuff it” when it comes to digital downloads. 

For those that think that Apple and iTunes is the “only game in town”, they are only deluding themselves.  Funny how I got nearly 10,000 tracks in this system and not a single one came from iTunes.  Nearly all of them either came directly from my CDs, or from eMusic, Amazon, or LaLa.  Admittedly, there are the occasional torrent, but I only use that as a very last resort if I cannot find something via the more “traditional” ways.  Typically in the case of old, rare, out-of-print albums, especially those that were never released in the States (a lot of what I listen to, Prog and Power metal, is typically from European artists).

I was actually intrigued by this whole album format, as I am still one of those ones that likes to download/obtain complete albums (again, a lot of what I listen to often consists of “concept” albums, where you pretty much need to listen to the entire thing to get the full message of what the artist intends).  But since nearly everything I get is from independents, looks like it will still be the “old-fashioned” way of just zipping up a set of MP3 with the insert/booklet as a PDF file and the cover art as a JPEG (which is what the Australian progressive metal band, Voyager, did).

Very rarely, if ever, I listen to anything in the so-called “mainstream” anymore - cannot remember the last time I’ve listened to the radio, thus I am not interested in just getting that one “single”.  Once I got away from the mainstream artists, I was amazed at just what “REAL” talent is actually out there (and believe me, it ain’t on American Idol), plus it was such a joy to listen to an entire album and enjoy every bit of it from the first note to the final fade-out.  All killer and no filler.  Well, looks like I’ll continue to support the independents and be giving them my money and Apple will just be getting the middle finger.

Posted by SkiBumMSP on October 12, 2009 at 12:29 AM (CDT)


If people will just kindly ignore my total displacement of a decimal place above, I’d appreciate it ;-)

It’s *1500* copies of an album they need to sell to start breaking even, not 15,000, oops.

Posted by Code Monkey on October 12, 2009 at 7:24 AM (CDT)


Click on the link under the words “charging a handsome production fee”.  That refers to allegedly… so we dont’ know for sure if this report is true.

Peter Gabriel’s SO is an iTunes LP offering, and it’s copyrighted by Peter Gabriel ltd. Is that a major label, or an indie?

Posted by Katrina on October 14, 2009 at 1:28 AM (CDT)


I know how to make iTunes LP offerings, as many of you probably do by now what with all their tutorials and templates.  The “simple repackaging” involves a little HTML and a lot of TuneKit Javascript.  Unfortunately the templates they give you aren’t fully wired up; takes more than dropping in graphics and media titles. You can only check your work in Webkit, iTunes, and Apple TV as the code doesn’t work on Firefox or Explorer.

Posted by sonic on December 21, 2009 at 2:34 PM (CST)

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