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.”
