Universal confirms iTunes non-renewal | iLounge News

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Universal confirms iTunes non-renewal

The Universal Music Group has confirmed reports that it will not renew its long-term iTunes contract. The label responded in a statement, which said, “Universal Music Group has decided not to renew its long-term agreement for Apple’s iTunes service.  Universal Music Group will now market its music to iTunes in an ‘at will’ capacity, as it does with its other retail partners.” Macworld UK reports that in addition to variable pricing, Universal wants to be able to offer certain tracks and certain bands exclusively through other, competing online music services, in an effort to lessen Apple’s control of online music sales. Apple has yet to comment on the statement.

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Comments

1

D’oh!

Posted by alexarch in Dallas, TX on July 5, 2007 at 6:47 AM (PDT)

2

What artist would want their material offered ‘exclusively through other, competing online music services’?!? I assume Universal is also looking at pulling their CDs from WalMart?

Posted by yashin on July 5, 2007 at 7:32 AM (PDT)

3

good bye Universal, if it’s not on iTunes I won’t buy it and I don’t buy CD’s anymore.

Posted by squirrel on July 5, 2007 at 7:55 AM (PDT)

4

Lessen Apple’s control-HA
Is all about jealousy.

Used cds at amazon is the best deal yet.
Will universal try to fight the sale used cds next ?

C-YA Universal..Remember what happened to the dodo bird ? Dinosaurs ?

EXTINCT..

Apple created the wave. Get on or move over..

Posted by mango on July 5, 2007 at 8:32 AM (PDT)

5

So if I was an artist, even a big name one, then Universal told me they were only gonna sell my stuff here and there instead of everywhere… especially on the number #3 biggest music distributor in the world…

I’D BE ROYAL-TY TICKED OFF!!!

Posted by will_bc on July 5, 2007 at 9:24 AM (PDT)

6

Good riddance UMG!

Posted by The Raven on July 5, 2007 at 9:31 AM (PDT)

7

This might come back to bite Universal in the ###.  What happens when they try to exclusively sell an artist’s music through another store, say U2?  U2 who have a close relationship with Apple might just do the math and realize that they would get a lot more money without a record label, releasing their music themselves through iTunes and their own imprint.

That’s an extreme case, but this is a short sighted move for Universal.  The labels take one step forward with the EMI-iTunes deal and two steps back with this.

Posted by Jeffery Simpson on July 5, 2007 at 9:52 AM (PDT)

8

“So if I was an artist, even a big name one, then Universal told me they were only gonna sell my stuff here and there instead of everywhere… especially on the number #3 biggest music distributor in the world…

I’D BE ROYAL-TY TICKED OFF!!!”


I first thought the same thing, but the reality is that the artists are getting mere pennies from the record companies anyway.  If they haven’t risen up already, they probably won’t.

No, it will be Universal who sees a *major* dip in their sales when they pull out of the iTunes store, and money is the only language they understand.  Steve is right, who’s going to buy from some other crappy store that won’t work with an iPod when consumers can get non-DRM mp3s for free through file sharing?  My guess is that Universal will be crawling back in six months.

The irony here is that they aren’t fighting file sharing with law suits, they fought it by offering an easy, affordable way to get the song legally through the iTunes music store.  Unfortunately, that wasn’t good enough for them, so they have to do everything they can to drive the consumer back to file sharing.

Posted by Nusm on July 5, 2007 at 10:20 AM (PDT)

9

If more artists where smart enough to market their stuff without the “help” of the majors, companys like universal would simply vanish. that would be great wink

Posted by Dave on July 5, 2007 at 10:53 AM (PDT)

10

I’m not seeing that the article says Universal is pulling out of iTunes.  They only are not renewing their “long-term agreement.”  They are switching to an “at will” contract.  How can anyone think that is blatantly stupid considering how quickly the digital music biz changes?

Posted by superape on July 5, 2007 at 11:12 AM (PDT)

11

Universal artists should be VERY angry. Let’s get real here! I will only buy music from i-Tunes, PERIOD. i am loyal to this outstanding company and service. If I can’t get the song from i-Tunes-which is my first option- I’m just going to get the CD on the online auction site that ryhmes with “We-Pay” for TEN CENTS! The only looser here is the artist.

Posted by Hatman on July 5, 2007 at 11:23 AM (PDT)

12

OK fanboys…don’t get your panties in a bunch!  Universal’s catalog is not going to get pulled from iTMS.  Universal just wants to explore other opportunities…opportunities that could be good for them (and maybe even for you and Apple).

Example: Fergie does a hot new track for an upcoming summer blockbuster movie…Universal would want to be able to sell that song for $2.99 instead of a paltry 99 cents.  Maybe this will be justified by the song being of a much higher bit rate, and minus any copy protection.  And, most likely the song will still be available as a part of the album purchase on iTMS (but not as a single on iTMS).

Sorry fellas, but a hot track is worth more than 99 cents and Universal knows this.  An entire album may not be worth more than $9.99, but that’s the benefit of buying in bulk.  Most albums are purchased because of one or two tracks from the album you hear on the radio, so that one or two singles is worth more than the rest of the album.  That’s the music industry, guys, and if this paradigm shift works (actually it is more of a shift back to how the industry was and some will say how it should again be), you can bet Apple will follow suit and do the things I’m talking about here.

Posted by YouKnowItsTrue on July 5, 2007 at 12:20 PM (PDT)

13

@YouKnowItsTrue
Bad Example; The only tracks Fergie is entertaining in are Music Videos, and then only if you mute the sound…

The truth is, iTunes is taking the Marketing Hype out of Music Sales. Songs get purchased on their Merit, rather than their Marketing.

Music Labels make money out of Marketing their product, if the marketing gets omitted, Music Labels become redundant. That’s what Universal is afraid of.

Posted by Salvo.Dan on July 5, 2007 at 1:24 PM (PDT)

14

Salvo-

Fergie is a bad example…I don’t think so, buddy!  She’s got four songs in the iTMS top 100 right now.  Ironically she has both clean and explicit version of her songs, so if you were to combine the sale of both version of ‘Big Girls Don’t Cry’ she would have the #1 song on iTMS!

Anyhow, use a little imagination and apply the business model I laid out with someone you are a fan of (an artist you would buy).  I used Fergie because I’m a fan and she’s a Universal artist.

I agree with your second point about iTMS selling music more on its merit…that’s kinda what I’m saying as well.  But, the truth is that some songs merit more than others…some are worth more than 99 cents and in fact some are worth less.  A hot Fergie song is worth more than 99 cents to me and many others.

Your last point is a bit of a trickier one, because music (and everything else we buy) needs to be marketed in some way or another.  I think I understand your sentiment, but you’re totally wrong on your facts…Labels spend money on marketing…they make money on sales.

The problem Universal (and some other labels who are remaining quiet as of now) has with Apple is that the labels are doing all the spending on the marketing/development and Apple is controlling their sales.

Posted by YouKnowItsTrue on July 5, 2007 at 1:54 PM (PDT)

15

All I’m sure about is that if a song or album I wanna purchase is not available on iTunes which Universal offers elsewhere, then I’m not buying it period.  Either I find it by “other” means, or I just don’t buy it at all.  I refuse to buy over priced cds and I refuse to wait ages for a song to become available in a record store, how archeic.  When I hear music I like, I wanna buy it instantly, forget about waiting. This is the digital age. If it’s not on iTunes, I’m not buying it.  That’s just me though.

Posted by canadan on July 5, 2007 at 2:33 PM (PDT)

16

Isn’t U2 on UMG? Will anything happen with the U2 iPod because of this dispute?

Posted by brent on July 5, 2007 at 2:41 PM (PDT)

17

YouKnowItsTrue,

I understand your logic, but not very many people are going to pay much more over .99 for one track even without DRM if they can get it “elsewhere”.  Your business model is why the music industry is in shambles now.  I can remember paying $4.99 for what was then called a maxi single.  Which was basically the original song an instrumental and maybe a remix.  Those ridiculous prices and your business model were relevant before digital distribution because you couldn’t get music anywhere else, now that you can it won’t fly. 

Itunes works because .99 for a track is worth the avoided dangers of getting a song “elsewhere” if Universal jacks up prices on single tracks far beyond that it makes that headache worth it to avoid getting gouged.  I personally still buy CD’s just to support artists I like even though they only get a small cut of the profit.  Nevertheless, I can assure you if Universal applies your logic (which it seems they have) they can expect a lot more people to get there songs “elsewhere”.

Posted by ArtVandelay on July 5, 2007 at 2:43 PM (PDT)

18

I personally would never pay 3 bucks for one song, and I wouldn’t even pay 99 cents if it meant I had to sign up with some other service as well. Right now iTunes is one of the biggest digital music distributors, so I don’t think I’m speaking only for myself when I say I’d rather just stick with iTunes and leave it at that. If Universal releases a song or album I like somewhere else, even at the same price, you can bet I’ll be downloading it instead just to avoid creating redundant accounts with other music distributors. Maybe I run the risk of putting all my eggs in one basket that way, but I’m pretty confident with the way the iTunes store is running and where it’s going. If Universal wants to rock the boat, they run the risk of alienating thousands of users like me who are not necessarily using iTunes out of some weird loyalty to Apple, but because of the convenience and price. They’re assuming that people will be so motivated to buy a “hot track” that they’ll not only pay more, but that they’ll put themselves in a more complicated state of operation as well. The whole point of iTunes is simplicity and ease-of-use. Universal wants flexibility and that’s fine, but I think they’ll feel the pain if they try to make any of their music, especially popular stuff, available EXCLUSIVELY away from iTunes.

Posted by Joshdude in Long Beach, CA on July 5, 2007 at 3:31 PM (PDT)

19

Guess I’ll be hunting down Universal music on P2P. I’m not paying more than what I have already been paying. What? Their costs went up? Give us a break.

Posted by Astounded on July 5, 2007 at 3:35 PM (PDT)

20

Art-

I definiteley remember the days of $4.99 maxi-singles.  I’m glad those day are over, for sure.

The real key to my business model is to get iTMS to go along with it, which I believe they ultimately will.  Already you’ve seen a 30% increase in the price of the BMG catalog to account for higher bit rate and no DRM.

The main thing that is going on between Universal and Apple is a PR battle.  People love Apple, but they hate the labels.  The labels will take the heat for the price increase, but they will be glad to if they can now sell their hotter tracks for $2.99 as opposed to 99 cents.  Apple will eventually go along with it, because they have a profit motive as well.  Anyone who thinks Apple wouldn’t want to increase their take from iTMS by 300-400% is foolish.

A lot of people say they’re looking out for the artist, but how can you say that if you want their tracks to be sold for 99 cents regardless of any other factors.  I’m sure the artist would love to have an increase of 300-400% percent of each track they sell online as well. 

Siding with the artist is no better than siding with the label.  Remember when Prince had his $100 million contract with Warner but still found something to complain about?  Prince had the word ‘slave’ shaved into his beard as he felt he was being taken advantage of by his label…give me a break.

Face it guys, I will face it with you, we want to get tracks for 99 cents (if not for free), but there’s not much of an argument you make for keeping the price at 99 cents being the right business choice for the powers that be.

Slightly off topic, but iTMS is missing the boat on remixes.  Most songs I would consider buying I hear ten times a day on the radio so there’s no need to buy it.  But, a good remix that’s not over the air I would buy.  Kinda brings us back to the maxi-single idea.

Posted by YouKnowItsTrue on July 5, 2007 at 3:37 PM (PDT)

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