iTunes prices should be lower, labels “don’t get it” | iLounge News

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iTunes prices should be lower, labels “don’t get it”

“But some popular albums are inexplicably higher. Buying all 14 tracks on Jessica Simpson’s “In the Skin” on iTunes cost 13.86. The physical album, including a bonus DVD with scenes from her wedding, is $13.39 from Amazon. Sheryl Crow is perhaps the artist who has most aggressively promoting legal downloading. Her 2003 greatest hits album has a song missing on iTunes; buying the 16 others will cost you $15.84. The physical CD with all 17 songs cost $9.99 on Amazon.

This is crazy. Online prices should always be much lower than physical CDs. The economics of downloading favor high volume. CDs have to be pressed, warehoused and shipped, but in the online world, you transmit a file to the vendor and just collect money. When a super popular artist like Norah Jones emerges, forget about convincing a hundred thousand people to download it at $13-get a million people to make the mouse-buy for five bucks. It’s nice to sell 100,000 Norah Jones albums online at $13, but even better to sell 2 million at five bucks a pop.”

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Comments

21

I’ll pay 1$ a song when its in WAV. I’m not using AAC @ 128 which is inferior to mp3 at 192.

Gah, waste of money. Its just another trend.

Posted by Stasyna on May 3, 2004 at 8:16 PM (PDT)

22

Chris/Jobs Failed-

Jobs has failed several times.  If you can’t yourself recount any times he, or Apple has failed, then you truly are blind and I won’t waste time detailing a long list of failures that you would summarily discount.  Also, note that because I say Jobs has failed, I’m not implying that no one else has ever failed at a business venture.  Please don’t respond by saying that because Jobs has done so many great things, he’s not to be accountable for his failures, too.

He will fail with the digital music downloading, not because he doesn’t have passion or vision, but because he’s trying to control an industry way too big for him.

The music industry doesn’t need Jobs, Jobs needs the music industry.  They will dictate every move he makes in the future.  They will control his price and his profit margins.  He can’t beat them and his hubris has blinded him to the point he thinks the industry needs him more than he needs them.

Consumers don’t need Jobs, either.  Everything he’s offering someone else is offering at a better price.

I love the iPod, I hate iTMS.  The business model of using one to fuel the other is doomed and will lead to failure.

Posted by BigSid in Los Angeles on May 3, 2004 at 9:03 PM (PDT)

23

Record companies don’t understand economies of scale or “making it up in volume,” do they?  They would truly sell many, many more copies of a CD at 6 or 7 bucks (even online, compressed), but they insist on selling a quarter as many at 14.99.

It’s like they assume if they leave it there long enough, people will keep buying anyway.  And it’s only recently that this changed, so I guess I can’t blame them.

Personally, I’m surprised they aren’t sitting the album on the shelf at $999,999.99 a pop…if you can get even 2 or 3 rich morons to buy, you’ve made just as much, right?

Posted by Carl on May 3, 2004 at 9:32 PM (PDT)

24

Haha Sure is obviously a big expert on Macs. “Think Different” hasn’t been used for quite a while there, chief. Your dislike of Mac’s is so obviously based on your own hands on experience with OS X. Haha. Anyhow so yeah Apple should open up Fairplay? Riiigght. That doesn’t make much sense for Apple. How would that benefit them? This should be fairly obvious to you. Remind me not to hire you to run my company! Other formats on the iPod? Oh yeah that’ll help. Besides everyone can convert those crappy ripped WMA’s to AAC now with iTunes! Haha! Think Different!

Posted by Biff on May 4, 2004 at 4:51 AM (PDT)

25

This article has nothing to do with Win vs. Mac, Steve Jobs, or Apple as a company.

I agree with the original premise of the article on the following:

A) Pricing is too high for digital music - since it’s all “leased” anyways with more restrictions than a CD…and…manufacturing costs are next to nothing…shouldn’t it cost less the vast majority of the time?

B) Pricing doesn’t fit the medium - CD’s are often a much better value.  That makes zero sense.

C) Do you expect common sense from an industry that sue’s children over copyright infringement?

Posted by AMG on May 4, 2004 at 5:18 AM (PDT)

26

The people who complain about paying 99 per song are the reason the music industry right now is miserable. Cheaper prices result in cheaper-quality music. Music should be MORE expensive. Rest assured, if a cd cost $25, bands like Nickleback and Puddle of Mudd would be serving me my morning coffee at the local Starbucks in no time, whereas bands with loyal followings who continuously produce music that pushes the medium (David Byrne, Radiohead, Death Cab for Cutie, Bjork, etc.) might not move as many “units,” but they’d still be able to have a career in the industry. I know that I personally have no problem paying $25 for an album I love by a band I love and respect.

The ITMS is an “a la carte” service, coupled with convenience. You pay an extra $5 to have pizza delivered to your door and nobody complains about that. But paying to have music delivered to your door somehow gets people pissed off. A la carte = higher prices. Delivery = higher prices. And note: most albums on ITMS are $9.99 regardless of the number of tracks. The only exceptions to this rule seem to be artists who are driven by singles sales, not album sales.

Examples: Beyonce = singles sales (album: $13.86 for 14 songs.) Modest Mouse = album sales (album: $9.99 for 16 songs.) Get it?

Posted by Jason on May 4, 2004 at 6:30 AM (PDT)

27

Jason-

I agree with much of what you said, but one problem is when people give into paying $25 for ANY album, ALL albums become $25.

You will pay $25 for Radiohead (a band you love), so the labels figure the girl next door will pay $25 for Britney Spears (who she loves).

Have you ever bought tickets from Ticketmaster?  Here’s what they tack on for ‘convenience’ in addition to the price of the ticket itself…

1. Convenience Charge
2. Order Processing Charge
3. Ticket Deliver Charge

Also, not many people pay an extra $5 to have a pizza delivered.  Most pizza chains deliver for free to compete.  Most online retailers offer free deliver, but it seems that Apple is making the mistake of charging a ‘convenience fee’ to those who want entire albums instead of singles.

Posted by BigSid in Los Angeles on May 4, 2004 at 6:54 AM (PDT)

28

BigSid - I hear what you’re saying about the $25 thing. I was more making a point than anything. People don’t realize how good we have it when it comes to music prices. Think about it… albums were $10 each in 1984 - and 20 years later they’re the same price. Someone show me an example of any other product whose prices stayed relatively the same over an 20 year timeframe.

And as for the pizza thing - you tip don’t you? Cheap bastard. wink

Also, Apple is doing the OPPOSITE of charging a convenience fee - you DO pay less when you download the whole album… just not for singles-based artists. (Did you not read that part of my post?) Look around - you’ll see the same thing.

In our culture, there is a little thing called “perceived value” that gets overlooked when it comes to music. Take a $20 purse, charge $100 for it, and you’ll sell more. Why? Because people inherently equate worth with price. Reduce the price, reduce the worth. Charge $5 for a bands cd, and I assume that the music isn’t worth sh*t. Music is supposed to be art that moves the listener, not mass-produced to move units.

Posted by Jason on May 4, 2004 at 7:04 AM (PDT)

29

Comparing music prices today with music prices 20 years ago is VERY misleading.  While the price of everything else has gone up, the price of music should be going down.

Thanks to advances in technology, distributing music (and recording it) costs virtually nothing.  Hardly any musicians record with a 2” analog tape anymore, it’s all digital.  Which means there is no physical product being consumed while recording, its all stored in bits and bytes. 

If I can buy 100 blank CDs for $10, how much do you think it costs record labels to buy 100,000 of them?

And if the cost of manufacturing CDs is virtually nothing, what are we paying for?  Marketing costs, promotion costs, and a bunch of other B.S. costs that have nothing to do with the CD.  If I let a friend hear a CD I bought, why should he pay money to buy the CD and cover advertising costs?  I was the one promoting it, NOT the label.

If we’re comparing prices to 20 years ago, we’d still be paying $2500 for a 32mhz computer with 16MB storage.  Don’t be duped.

Posted by Ryan on May 4, 2004 at 7:40 AM (PDT)

30

Jason-

Like I said earlier, I agree with much of what you say.

The notion of perceived value is interesting in the music business right now, because Apple is competing with…

A) Kazaa.  It’s hard to charge for something that can be had for free.

B) Radio.  Lots of the top downloaded songs are overplayed on the air for free.

C) Target/WalMart/BestBuy have great prices on new release CD’s.

Ironically, many people are downloading new ‘hot’ songs from iTMS, when they could buy the whole album for $9.99 (Target/WalMart/BB), but the real deal with iTMS is buying ‘oldies’ that are harder to find at major chains and get zero airplay.

The future of music is $2.99 (download) for a single and roughly $9.99 (Target/WalMart/BB) for an album.  this is the model that has been succesful for the labels in the past, and this is what they will gravitate back to.

And, oh yeah, I forgot about tipping the pizza driver wink

Posted by BigSid in Los Angeles on May 4, 2004 at 7:56 AM (PDT)

31

“You pay an extra $5 to have pizza delivered to your door and nobody complains about that.”

- And if the pizza places followed the same model as iTunes, you would get ketchup and bologna on a piece of bread and it would come with no box. Oh yeah, and you wouldn’t be able to share it with your friends. If you did, PIAA would sue you.
I’ll start paying $5.00 to have my music delivered when Steve Jobs shows up at my door within CD’s 30 minutes after I place my order/

“. Cheaper prices result in cheaper-quality music. “

- Simply NOT true. There is no evidence to support this. See, that’s the cool thing about music—some people just LOVE to play music. The fact that they can make money off of it is just and added benefit. If the money went away, only the real artists and the real fans would remain. Do you REALLY think we would be tortured with the likes of N’Sync if they weren’t making millions? Do think they would play the local bar for free drinks and some bar food?
Don’t get me wrong - I don’t think that musicians should starve. I have no problem with MUSICIANS making the money.  The REAL problem is the record companies and companies like ClearChannel shoving crappy music down our throats. They are filled with people that don’t care about anything but making a profit and have no interest in the quality of the music. I say, let them starve and then if the musicians get rich - so be it. Do you REALLY think all of these crap bands would survive without all of the marketing BS?

Posted by TheRecordIndustryMustCrumble! on May 4, 2004 at 8:39 AM (PDT)

32

Hey Biff (appropriate name).

The legions of Mac morons on this site (of which you appear to happily be a member of) love that little “Think Different” slogan hence my allusion. Yet there is no thinking different when it comes to devout Mac users who long ago lost the ability to think for themselves. You demonstrated that better than any example I could have given. 

Job whipping boys immediately rationalize any decision Apple makes by how it makes sense for Apple, never the consumer. The entire point of my post is how much of an ### you would have to be to argue against user rights/experience by citing how much better it is for a company.

Thanks for illustrating my point Biff. As far as running your company sorry to hear I don’t qualify but considering you seem to have the intelligence of a cotton ball I am not too concerned that I missed any big opportunity.
Thanks for considering me though.

Posted by sure on May 4, 2004 at 9:24 AM (PDT)

33

Just some of the cost involved in promotion and distribution of a CD goes to printing, pressing/burning/plant costs, packaging, and shipping. Take those costs out of the picture and damn straight online music should be much cheaper!

Ten bucks flat across the board. MAX. I don’t buy records online that cost more than that. Maybe that would be a good way to get the message across. DON’T BUY EP’S ONLINE THAT COST MORE THAN TEN BUCKS! This is a groundbreaking time in music history. You can either let the big 5 set your price point for you, or DO IT YOURSELF!!!!!!!

-Alana

Posted by Alana on May 5, 2004 at 10:00 AM (PDT)

34

Jason—“People don’t realize how good we have it when it comes to music prices. Think about it… albums were $10 each in 1984 - and 20 years later they’re the same price. Someone show me an example of any other product whose prices stayed relatively the same over an 20 year timeframe.”

Your point is well-taken. But there are many examples. My favorite is Gas, which everyone complains about. It has stayed remarkably stable over the years, with the exception of the 1970’s spikes.

Posted by JD on May 8, 2004 at 4:03 AM (PDT)

35

AllOfMP3.com
http://www.allofmp3.com/index2.shtml

You buy songs by the bandwidth - 1 cent pe rmegabyte.

So each song costs around 4-8 cents, depending on what bitrate you choose to encode at, and which format.

Nuff said!

Posted by By The Megabyte on May 8, 2004 at 7:32 AM (PDT)

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