Record companies criticize Apple for iTunes pricing | iLounge News

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Record companies criticize Apple for iTunes pricing

Many in the music industry are concerned that the iTunes Music Store’s flat rate pricing has done lasting damage to profitability and are adamant that Apple will be forced to move to a variable pricing structure. Music industry executives are taking swipes at Apple at this week’s Midem music trade show in Cannes.

“I’m hearing that the artists aren’t happy, the publishers aren’t happy. Someone other than Apple needs to be happy for this industry to grow,” said Amit Shafrir, president of AOL’s premium services arm.

Record companies say Apple’s 99-cent per song pricing has set the benchmark too low, but have failed to persuade the company to switch to variable pricing, which would allow popular songs to be sold for more.

“For the time being we all must work with Apple and make the most of iTunes,” said Eric Nicoli, chairman of EMI Group PLC, the world’s No. 3 record company. “Single pricing is almost unique to the music industry,” Nicoli added. “If you look at any other consumer category—including things like iPods—they sell at different prices.”

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Comments

1

The record companies can bite me. These guys are idiots and I hope the music industry dies a very painful death in the near future.

Posted by nosedive51 on January 24, 2006 at 10:21 AM (CST)

2

How greedy could these companies be? If you think about it they get more money from iTunes then they get when you buy it from a store.

Posted by Jonathan Keim on January 24, 2006 at 10:22 AM (CST)

3

iPods sell at different price points because of different feature sets, as do most consumer electronics.  How can you objectively rate a song as good or bad and assign a price accordingly?  That’s why songs should remain single pricing.

Posted by Unseen Llama on January 24, 2006 at 10:27 AM (CST)

4

“I’m hearing that the artists aren’t happy, the publishers aren’t happy. Someone other than Apple needs to be happy for this industry to grow,

Posted by bRaD Weston on January 24, 2006 at 10:34 AM (CST)

5

And iPods sell at different price points because they are very different than a song! Technology, entertainment. An iPod is not a song record peoples!

Posted by Todd on January 24, 2006 at 10:35 AM (CST)

6

“Album sales have declined steadily as consumers ‘cherry-pick’ individual tracks online, said Phil Leigh of Inside Digital Media, a U.S. market research firm. ‘When you can buy just the songs you like in a digital format, you don’t have to buy the album.’”

I think this is an important point. For decades the music industry has been promoting albums but only allowing certain “winner” tracks to get air play to try to trick consumers and, basically, give them as little back for their money as possible. Now if there’s only one good track on an album, consumers will only buy that one good track.

Posted by Semantics on January 24, 2006 at 10:36 AM (CST)

7

The record companies do have a point, although the greed overshadows their need.

Since iTunes delivers the music WITHOUT the need for distribution, marketing, packaging and shipping costs, it stands to reason that the record companies are still making money (unless the retail cost of CDs is so inflated where the record companies are not affected by the price bloat for in-store sales).

It seems that Apple has established e-music, and the labels are scurrying at disbelief and disappointment that content delivery isn’t as important as getting the music cheaply and fast.

Posted by Chris G on January 24, 2006 at 10:38 AM (CST)

8

99c (or an extortionate 79p in the UK) IS the wrong price for a song. I object to paying that price for a naff quality 128kbps download or £7.99 for an album when I can get a high quality CD for the same or less from on-line sellers. I wouldn’t object to a variable pricing structure if I could get lossless or high bit rate VBR material at a “premium” price.

Posted by drevo_uk in UK on January 24, 2006 at 10:48 AM (CST)

9

GIVE ME A BREAK, variable pricing?  New CD’s are all priced the same, music pricing has never been variable.  LIARS!!!  CHEATS!


http://kaseiffert.is.dreaming.org

Posted by Keith on January 24, 2006 at 10:50 AM (CST)

10

From this consumer’s p.o.v. the tracks are hideously overpriced already for every single one of them. What record companies need to do is give us the same thing we get from a CD: lossless sound quality and unlimited usage “rights”, then and only then can they begin to talk about a broken price structure. When I buy CDs I pay around $0.40-$0.90 tops per track by being a smart consumer.

I can’t see how they can afford one portion of the industry, complete with pressing, packaging, shipping, and retail floorspace overhead costs that costs me less than something like iTunes *and* gives me much higher quality and more choice, and then try to claim that another portion of the industry with no built-in costs, higher costs to the consumer, and higher profit for them is so bad. They also seem to have no comment when it comes to every other online music service which sells for the same or less than iTunes. Heck, the indie based ones like audiolunchbox manage to sell tracks for less than iTunes and pass more $$$ to the artists and producers.

In the end, I see it as nothing but greed and an attempt to continue their utterly broken business model by trying to dress it up as Apple somehow harming the artists. 3% of the total music sales at a higher price point and higher profits for labels and artists cannot be doing much of anything to anyone except causing the labels fits as they try to figure out how to squeeze more blood out of a stone.

Posted by Code Monkey in Midstate New York on January 24, 2006 at 10:52 AM (CST)

11

I agree with the record companies.  They should be allowed to charge more for songs if they want to…or less.

Then they scratch their heads in bewilderment as download sales plummet because no one wants to pay $2.00 for a 128 kbps file. 

I’ve purchased about 200 songs from the iTMS BECAUSE the songs are .99.  If they go up in price, I won’t buy them.  Pretty simple.

But let the market forces decide.  Besides there’s always peer to peer downloads which offer music at a substantial discount.

Posted by hedgeland on January 24, 2006 at 10:55 AM (CST)

12

that’s right, iPods *are* priced differently. because they offer different sizes and features.

BRILLIANT, Shafrir! let’s price songs according to length! a penny per second! that way most pop songs will cost you about as much as a value menu item at McD’s, and if you are an opera lover you can trade your furniture in for some music!

or better, yet…let’s price by popularity or demand. every 100 downloads will raise the price by a cent. teenagers hungry for the latest craze will drop millions into your fat coffers. TREASURE BATH!!!

by the way, Shafrir, how’s that AOL music service doing? hmmm?

Posted by Toxic Boy on January 24, 2006 at 10:56 AM (CST)

13

I agree with drevo_uk, that as long as we get served low-quality downloads the price is too high anyway.

I buy the CD, RIP it at a ‘serious’ bit-rate and throw the CD into a box just in case I need it (or a look at the booklet) again.

Posted by rob-switzerland on January 24, 2006 at 10:59 AM (CST)

14

Bingo, Semantics! The record companies are mad that they will no longer be able to make as much easy money off someone who’s only talented enough to produce one catchy song (but looks good on MTV). They might actually have to find and promote artists capable of putting out SEVERAL good songs!

These record company people are world-class whiners. If the music is good, people will buy it. And iTMS is providing a viable way for them to continue selling their product as technology evolves. I’ve bought more music since getting my iPod in December than I had in the past 2 years. But if they want people to pay for the full album, they have to put out full albums that are worth paying for, and not the same old crap. It’s pretty simple.

Posted by scaribas on January 24, 2006 at 11:00 AM (CST)

15

To be honest, if they raise the price of popular songs I will go right back to downloading illegally, i have so far purchased over 700 songs from itunes becuase I think .99 is a fair price for a song.  I have absolutely no qualms about going right back to what I was doing before itunes came along.  Limewire, bittorent etc.

Posted by downwithriaa on January 24, 2006 at 11:01 AM (CST)

16

Variable pricing?  sure!  As long as they go no higher than 99 cents! ;)

You know the record companies don’t want variable price lowering.  They want to be able to charge more than 99 cents.  They can bugger off.  I say let apple deal direct with artists.  Who needs a physical record company?  ahha

Posted by Xenious on January 24, 2006 at 11:13 AM (CST)

17

“switch to variable pricing, which would allow popular songs to be sold for more”


Uh yeah, and are we going to sell the unpopular songs for less? I didn’t think so.

Posted by Orcin on January 24, 2006 at 11:21 AM (CST)

18

“Album sales have declined steadily as consumers ‘cherry-pick’ individual tracks online, said Phil Leigh of Inside Digital Media, a U.S. market research firm. ‘When you can buy just the songs you like in a digital format, you don’t have to buy the album.’

Posted by phennphawcks on January 24, 2006 at 11:22 AM (CST)

19

It just goes to show how completely they disregard the customer.  When is the last time you said “Gee, I wish these tracks would be MORE expensive.” ?

They are greedy.  They are getting money for free (no distribution, production costs), and they STILL complain.  It is greed, pure and simple.

If tracks go over $0.99, I WILL NOT BUY.  Apple understands that $0.99 is the magic point.  The record companies just don’t get it.  I can’t wait until they are completely destroyed by their own incompetence and greed.

Posted by m. sherman on January 24, 2006 at 11:25 AM (CST)

20

Someone other than Apple should be happy?

How about CONSUMERS

99 cents is a great price if it go up to 1.49 I may stop buying those songs, I not a big music listener but from time to time I fill myself inmerse in the iTunes music store and buy some songs for my collection and listening on my iPods and office.

Posted by checo on January 24, 2006 at 11:34 AM (CST)

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