Warner Music Group has revealed that unit sales growth on the iTunes Store has decelerated since the move to a variable pricing scheme. AllThingsD reports that industry-wide, year-over-year “digital track equivalent album unit growth” was 5% in the December quarter, down from 10% in the September quarter and 11% in the June quarter. As iTunes makes up the majority of Warner’s digital revenue, growth is slowing in that metric, as well, with digital revenue up 8% year-over-year in the December quarter, compared with a 20% growth rate in December 2008. Warner CEO Edgar Bronfman Jr. said that music downloads are a “mature” business, and that the pricing change has been a “net positive” for the label, but also suggested that, looking back, the move to raise prices wasn’t the best idea during a time of recession. Apple announced the move to a variable pricing scheme, under which individual tracks are sold for $.69, $.99, or $1.29, in January 2009, although the changes didn’t take hold until April 2009.
Warner sees slower sales growth after pricing change
Charles Starrett was a senior editor at iLounge. He's been covering the iPod, iPhone, and iPad since their inception. He has written numerous articles and reviews, and his work has been featured in multiple publications.