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MacRumors
Apr 23, 2006, 08:59 PM
http://www.macrumors.com/images/macrumorsthreadlogo.gif (http://www.macrumors.com)

The New York Post is reporting (http://www.nypost.com/business/64711.htm) that the record industry may be on the verge of conceding to Apple's demands that iTunes song pricing model remains constant at $.99 per song.

But Jobs has dug in his heels on the issue, creating the potential for a showdown between the mercurial Apple boss and the record industry should the labels continue to push for variable pricing.

Apple's current contracts with the record labels expire in the next two months. The NY Post reports that some labels could go as far as to pull their songs from the iTunes Music Store -- however, a more likely scenario described is that the companies will continue to provide their songs but without a contract in place.

"That would be problematic for Apple because it allows labels on a whim to pull their stuff whenever they want," said one high-level music executive.

These discussions have been an ongoing point of contention (http://www.macrumors.com/pages/2005/09/20050930092813.shtml) between Apple and the record labels.

powerboy
Apr 23, 2006, 09:03 PM
Stay strong Steve! The greedy record labels will never quit.

bluebomberman
Apr 23, 2006, 09:03 PM
Ah, the NYPost. The most reliable source of info on the planet, at least, when they're not extorting people (http://www.usatoday.com/life/columnist/mediamix/2006-04-10-media-mix_x.htm).

EricNau
Apr 23, 2006, 09:05 PM
It is very important that Apple keep every song at $.99.

I wish these darn record labels would stop being so greedy. When iTunes first came out, they saw Apple as their savior against pirates. iTunes has sold 1 billion songs since then, so that's 1 billion songs not pirated.

They should bow down to Apple!

Spanky Deluxe
Apr 23, 2006, 09:08 PM
The whole 99c thing is fantastic. The constant price means you always know how much you're going to have to pay. Its kind of ridiculous when you see some singles for sale in high street shops that have two tracks and sell for £3.99. Absolutely mad.

Macmaniac
Apr 23, 2006, 09:09 PM
Record Labels: Lets take a perfectly good ITMS and raise the prices
Customer: **** that, back to piracy I go!

muffinman
Apr 23, 2006, 09:09 PM
yeah. keep it at 99

sam10685
Apr 23, 2006, 09:12 PM
yo Jobs... yeah, u gotta stay strong... don't let greedy record label's mess with ur stuff...

EricNau
Apr 23, 2006, 09:13 PM
I really doubt any (major) record label would go as far as to pull their songs from iTunes. While they may not be able to control what iTunes is charging, they are still making plenty of money from each song sold.
If they pulled any songs, they would not be able to make up all of those sales in CDs or from another online service, people just wouldn't buy as much (people are lazy; they'll either just listen to it on the radio or pirate it).

ImAlwaysRight
Apr 23, 2006, 09:13 PM
Steve oughta whip ass and take names later!

Veritas&Equitas
Apr 23, 2006, 09:15 PM
I'll have to admit, as much as I love the $.99 thing that the Music Store does have going for it, the music industry DOES have a point. Since when do retailers tell the suppliers what they will be paying for goods? It seems a little backwards to me, not that I'm complaining, b/c I hate record companies just as much as the next guy...but it does make some sense....

gugy
Apr 23, 2006, 09:16 PM
Good for you Steve!

Keep those bastards in their place.

If the Itunes raise their prices the piracy will just go up.

It's unbelievable. CDs should cost US$7 by now. Not $18 or more. And they don't understand why people go into piracy.:mad:

Baseline
Apr 23, 2006, 09:25 PM
I'll have to admit, as much as I love the $.99 thing that the Music Store does have going for it, the music industry DOES have a point. Since when do retailers tell the suppliers what they will be paying for goods? It seems a little backwards to me, not that I'm complaining, b/c I hate record companies just as much as the next guy...but it does make some sense....


Well, I always hear stories about Wal-Mart telling the suppliers what they'll be paying for the goods. Not that I advocate following Wal-Mart's lead in anything, but there is precedent for it.

sethypoo
Apr 23, 2006, 09:35 PM
I think the record companies should be happy with what they've got. Don't look a gift horse in the mouth, as you might say. Apple has done more for them in the past three years than all their high paid executives could have done in 25 combined.

I mean, sure, they could make even more money if they raised the song prices, but I think they'd lose a lot of business if they did so. .99 has a better ring to it than 1.99.

syklee26
Apr 23, 2006, 09:36 PM
The biggest problem with these label company's desire to have multi-tier pricing scheme is the fact that most of the songs will be over 99c while only a few songs would go under 99 (such as songs in those 99c per CD bin in Tower Record and places like that).

this in essence is NOT a multi-tier pricing system. it's more like a single-tier pricing system with some "promo-type" discounts of really crappy old songs.

and these labels don't realize the fact that Apple can still sell a lot of iPods without some of the songs on iTunes. Probably not as much as Apple could but still a good number. However, with downloads almost equaling (maybe more than) CD sales, the lost revenue by pulling their catalog from iTunes would be significant.

I am not an Apple apologist but Label's demands are absurd.

once their negotiation with Apple fails, I can certainly see that they will file to seek a declaratory judgment in some court that importing songs from CD to computer for a purpose of using them in mp3 players is violation of copyright protection.

AidenShaw
Apr 23, 2006, 09:36 PM
El ninġ is spanish for-- the ninġ.
-Chris Farley
Not that I want to make you look silly, but it's "El Niño", not "El ninġ".

nyah



http://en.wikipedia.org/wiki/El_nino

Rocketman
Apr 23, 2006, 09:37 PM
Hello.

1. FIXED pricing for now means $0.99 but that may not stay the same in the future. How much do you want to bet the NEW contracts specify FIXED prices but not WHAT prices?

2. When you sell old/new/good/bad songs at a FIXED price it levels the playing field such that POPULAR songs make bigger revenue on the MERITS.

3. The delivery cost has been reduced to zero from the record label's perspective.

4. Having "value added songs" at a high price are still possible. Make an "album" with ONE or TWO songs. Make a distribution NOT using iTunes at all. Just a suggestion. iTunes is, in theory, only ONE outlet. ONE. Why does anyone care what policies ONE outlet has?

Oh, wait, it has 87% market share. If it ain't broke DON'T FIX IT!!

Do we now regret dissolving/splitting the OIL companies or the PHONE companies?? Yes.

$0.99 and 10% APPLE profit or $1.29 and 20%+ APPLE profit. Hmmm.

Buy stock.

Rocketman

Electro Funk
Apr 23, 2006, 09:37 PM
Well, I always hear stories about Wal-Mart telling the suppliers what they'll be paying for the goods. Not that I advocate following Wal-Mart's lead in anything, but there is precedent for it.

you beat me to it... Wal-Mart does do this... in fact because of this rubbermaid (who was once based in a small town in Ohio) had to close up shop and move overseas to be able to produce products within the price range that walmart wanted to pay... (Wal-Mart was an exclusive distributor of rubbermaid back in the day... rubbermaid sold product through no one else)

BornAgainMac
Apr 23, 2006, 09:39 PM
I have a proposal. For 1 month, let the record companies select the pricing model. Then compare it to the current pricing model that Apple has in place. Whatever makes more profit wins. Record companies will receive a valuable lesson in the process.

The plan will be communicated to all the iTunes customers when the experiment will begin and that it will determine future pricing.

coumerelli
Apr 23, 2006, 09:41 PM
...I mean, sure, they could make even more money if they raised the song prices, but I think they'd lose a lot of business if they did so. .99 has a better ring to it than 1.99.

Or even $1.29 - not that I want to see it, but THAT number makes WAY more sense as a next step than 2x the current price!!!

mi5moav
Apr 23, 2006, 09:45 PM
What I can see is that the record labels may raise the rates to steve on some of there older songs. Steve is right, psychologicaly .99 cents is a very important barrier. Once I get to $1.00 I almost feel like I need a physical product in my hand. 1.00 is paper .99 is and will always be change. I can always find a bunch of it in my couch... but finding a nice buck is hard to do.

MacMosher
Apr 23, 2006, 09:59 PM
theres a direct relationship between prices and piracy.

price goes up then so does piracy.

WillMak
Apr 23, 2006, 10:01 PM
would anyone here support a 1.00 per song pricing if they changed the 128kbit to 192?

SC68Cal
Apr 23, 2006, 10:02 PM
I have no problem going back to pirating music to force prices back down.

MrCrowbar
Apr 23, 2006, 10:02 PM
1.29$ per song?
I'm tempted to rate this post negative (what does rating mean anyway? If I believe the rumor (yes/no) or if I like the rumor (yes/no)? )...

I'd rather get the real album on Amazon for that price, at least it's CD-quality and not (sorry) compressed. I'm an audiophile (therefore not considering an iPod HIFI ^^) and want the real thing. Actually, I'd love to have 48kHz 24bit Audio Discs because the dynamics are way better for classical music or jazz. 44.1kHz 16 bit is really the lowest limit.

I only use iTunes for previewing Albums and usually get the real thing on Amazon or eBay. Sorry.

j-a-x
Apr 23, 2006, 10:07 PM
99 cents per song is a really good deal, but I usually download albums. $10 Canadian for an entire album is a really good deal, and I'd gladly do that rather than buy from a store. If iTunes gets more expensive, I might think twice.

cornfedgrowth
Apr 23, 2006, 10:14 PM
would anyone here support a 1.00 per song pricing if they changed the 128kbit to 192?

For a penny more? Yeah, i think i'd pay a penny for 192kbit encoded files. If they raised it to 1.99... they might as well just go tell me to download limewire right now... (that or go support RIAA free bands and lables (http://www.riaaradar.com)) As a poor college student who doesn't spend that much on music anyway, any increase in pricing is gonna shut down my iTunes habit.

Kingsly
Apr 23, 2006, 10:14 PM
Cant the record execs get it through their pea-brains that Apple's pricing model is the only one that actually WORKS!?!?!?!

leidendude
Apr 23, 2006, 10:17 PM
If Apple changed its pricing to a tier system, not only would it become more expensive for us, but iTMS would lost its credibility. The motto is 99 cents a song, if it changed, what would it be: The iTunes Music Store, 100,000 songs, and more than a dollar a song. Just isn't as catchy. People know it for the price tag it's been flaunting, if this were to change all hell would break lose...Nope just exaggerating there, but it would be bad for Apple.

psionic001
Apr 23, 2006, 10:30 PM
I like the idea of afew months at Record Industry prices (as they want them now.) Alternatively the tiered model could fall below 99c. ie 99c for popular songs and 50c for older songs. Heh.... whatever!:o

p0intblank
Apr 23, 2006, 10:33 PM
Ahh, the music industry is so greedy! Jobs better win this battle.

bretm
Apr 23, 2006, 10:33 PM
I'll have to admit, as much as I love the $.99 thing that the Music Store does have going for it, the music industry DOES have a point. Since when do retailers tell the suppliers what they will be paying for goods? It seems a little backwards to me, not that I'm complaining, b/c I hate record companies just as much as the next guy...but it does make some sense....

When they're the only legitimate retailer! But on the other hand, when do suppliers tell retailers what to CHARGE for goods?

The system right now seems pretty normal. Back in the day a vinyl 45 with 2 songs on it cost the same across the board. All the singles were the exact same price. Now the albums, that was different. A crappy album would be cheap, or a great selling album might be cheap, and the whatever albums would be pricey. Over time, the good albums always cost a little more while the cruddy ones went to the bargin bin, etc.

It's the same with iTunes right now. I've seen full albums for as little as $5.99. (The Police) and other albums be $12.99. Both have 11 or 12 songs. The practice of selling a particular song as album only is also gaining speed.

Seems normal to me. The only difference these days is you have the luxury of buying almost any song as a single. Yeah, some of them are throwaway tracks you wouldn't buy at any price. But it must increase sales overall.

pacman7331
Apr 23, 2006, 10:34 PM
Ha... RIAA is super evil. I'm soooo glad the aquarian age of emergig nobility is now dilluiting the bone gnawing for blood RIAA industry with well examined behavioral marketing models.

...

Godspeed Apple to the ending of history! You inspire all us oil wollowing feinds with creative modalities of more rightous materialistic captialism

OM...

pacman7331
Apr 23, 2006, 10:41 PM
That said 99 cents a song is expensive and ludicris... I would suggest 33 cents a song and (apple should really compete with its own price here)... and a variable pricing for albums...

bretm
Apr 23, 2006, 10:53 PM
That said 99 cents a song is expensive and ludicris... I would suggest 33 cents a song and (apple should really compete with its own price here)... and a variable pricing for albums...

You do realize THAT is ludicrous? That barely covers the songwriter and publishers royalty. What is left for Apple and the record company? Not even enough to cover their costs of doing business. I'll best the rest of the band would like a little bit too. You realize that's the only place the musicians on a album or song make any money at all, right? They make a percentage of PROFITS. The authors and publishers get a set amount of money for each sale and for each play on the radio. It's around 5-10 cents years ago, but possibly more now.

But hey, let's just ream everybody and maybe they'll just quit making music altogether.

jne381
Apr 23, 2006, 11:02 PM
I'll have to admit, as much as I love the $.99 thing that the Music Store does have going for it, the music industry DOES have a point. Since when do retailers tell the suppliers what they will be paying for goods? It seems a little backwards to me, not that I'm complaining, b/c I hate record companies just as much as the next guy...but it does make some sense....
Look, there is a simple reason to keep the price of songs low; it makes pirating them less advantageous. $ 0.99 doesn't seem like a lot of cash, but $ 1.99 for a few songs would make someone just download from whomever they can get it from. It would hurt the record industry and iTunes. Apple is smart to put their foot down on this issue. Not to mention, the record company doesn't have to produce any actual physical product for delivery, so if you paid $0.99 for the amount of songs that comes on an album, they would make something like $12.00. The problem for the record companies is that nobody wants the whole album for most of the lousy bands they put out, so they only sell one song. To fix this problem I suggest they get better talent that can put out good music, instead of people that just look attractive and dance.

cornfedgrowth
Apr 23, 2006, 11:05 PM
You do realize THAT is ludicrous? That barely covers the songwriter and publishers royalty. What is left for Apple and the record company? Not even enough to cover their costs of doing business. I'll best the rest of the band would like a little bit too. You realize that's the only place the musicians on a album or song make any money at all, right? They make a percentage of PROFITS. The authors and publishers get a set amount of money for each sale and for each play on the radio. It's around 5-10 cents years ago, but possibly more now.

But hey, let's just ream everybody and maybe they'll just quit making music altogether.

I don't think pacman was being serious. I found it quite humorus, in fact.

QCassidy352
Apr 23, 2006, 11:05 PM
time for a game of chicken... i hope the record companies blink first.

mlrproducts
Apr 23, 2006, 11:08 PM
I know it is breaking the law, but darnit if they raise the prices I will go back to pirating ALL my music OUT OF SPITE. I will even pirate MORE music than I need! (which, is a useless statement as ANY music is more than I NEED - but the RIAA seems to think we NEED it!)

Revolutions are often against the government (and therefore their law), but sometimes you have to do what you believe in. I will continue to support artists by attending concerts.

EDIT: I say let Apple develop their own label (not named Apple, or course), but one that exclusively supplies the iTMS. Let them sell for $.50 a track, subtract overhead, and split 50/50 with artist.

MrCrowbar
Apr 23, 2006, 11:10 PM
No kidding, you only get 128 kbits on ITMS?
I tried all iTunes engocing formats, AAC is the worst on 128 kbits. Is it ok if I buy an album on iTunes and then download the thing in better quality on p2p networks? :p

I don't know if Apple makes really much profit of ITMS itself. I think it's main purpose it to sell iPods.

MrCrowbar
Apr 23, 2006, 11:17 PM
EDIT: I say let Apple develop their own label (not named Apple, or course), but one that exclusively supplies the iTMS. Let them sell for $.50 a track, subtract overhead, and split 50/50 with artist.

Hmmm, nice idea. We could finally believe Steve saying "We love music".

leidendude
Apr 23, 2006, 11:25 PM
time for a game of chicken... i hope the record companies blink first.

Blinking doesn't matter in chicken. :D

texasmafia
Apr 23, 2006, 11:47 PM
I think the price should actually be less than 99 cents but I won't complain about this price and I gladly pay it over having to drive down to Best Buy and pay 15 bucks for the same songs

Rocketman
Apr 24, 2006, 12:00 AM
Cant the record execs get it through their pea-brains that Apple's pricing model is the only one that actually WORKS!?!?!?!


No.

Hence the lawyers.

Rocketman

amateurmacfreak
Apr 24, 2006, 12:06 AM
Raised prices = Raised piracy

I love the artists but hate the labels.
**** (self-edited) the major labels.
The artists need to make a living... and the record company execs need to stop being greedy.

It's a sensitive issue.

sam10685
Apr 24, 2006, 12:07 AM
Not that I want to make you look silly, but it's "El Niño", not "El ninġ".

nyah



http://en.wikipedia.org/wiki/El_nino

SON OF A-- ur right... i thought it was over the O because the O is a vowel... thank u!

MrSteveee
Apr 24, 2006, 12:28 AM
In response to your comment:
I'll have to admit, as much as I love the $.99 thing that the Music Store does have going for it, the music industry DOES have a point. Since when do retailers tell the suppliers what they will be paying for goods? It seems a little backwards to me, not that I'm complaining, b/c I hate record companies just as much as the next guy...but it does make some sense....
I would like to point out that many retailers do exactly the same thing. Wal-Mart would be one of the most obvious examples, but so, too, with many other retailers.

pavetheforest
Apr 24, 2006, 12:50 AM
-prices go up= piracy for pave....its not hard.
-with 99 cent songs, i know im not pissing my money away
-i feel good about buying through itunes, its a brilliant process, if you dont take total sound quality into acount

Anyway..........

To sum it all up, if they raise prices i will stop using itunes, starting pirating, and MAYBE feel bad for doing so....for a millisecond. Maybe reminisce about how i used to buy songs, while i listen to my new...free...music......:cool:

pave

EricNau
Apr 24, 2006, 12:54 AM
:mad: These record labels almost make me want to pirate, not because I want their music but just for the satisfaction of ripping them off.

Lollypop
Apr 24, 2006, 01:42 AM
Either way if steve wins or not the iTMS brings competition to the US market and that is never bad. Over here there is no real online retailer, so we have to pay about $25 for a CD, and we dont have a choice.... come on apple... get this over with and bring out the music store in more countries!!!

abrooks
Apr 24, 2006, 01:49 AM
Who are the labels looking out for, themselves or the artists?

If it was the artists then I'd expect Madonna to be hiring lawyers against Apple but I don't see such a thing, I see CEO's of EMI and Universal moaning about the prices of music, have these CEO's looked at their own quarterly results, EMI is certainly making a profit and Universal isn't exactly struggling, its the same with all the labels.

What is the motivation?!?

kntgsp
Apr 24, 2006, 01:59 AM
I'll have to admit, as much as I love the $.99 thing that the Music Store does have going for it, the music industry DOES have a point. Since when do retailers tell the suppliers what they will be paying for goods? It seems a little backwards to me, not that I'm complaining, b/c I hate record companies just as much as the next guy...but it does make some sense....


Because it prevents morons with ariticially inflated egos from over inflating prices. Wal-Mart does this with their suppliers and I'm glad. I hate that Wal-Mart hurts small business, but I like that they are able to dictate prices to a certain extent. It helps prevent companies from charging more just for having a brand name. And this isn't hurting small business, this is putting pocket lining jackasses in their place.

And who is anyone to judge how much MUSIC is worth? How do you judge the economic value of a SONG?! You can price things based on popularity, etc. But that's trickier with music. You can only approximate how popular a song will be prior to release by playing it for control groups, etc. Playing a song on the radio prior to release to judge the popularity still hurts sales, because there's a good percentage of people who go to look for the song. If you look on iTunes and it's not there, then you go to LimeWire. They'd have to effectively release a song, see how many people buy it, then raise the price once they had guaged the popularity of it. That's asinine. You want to be a rich artist? Ok, then make a good ***** song. If they keep a price point, then you have a merit based system. If it's crap, nobody buys it and you don't get sh*theads like Britney Spears being turned into record industry bajillionaires.

Take for instance, an artist with a huge following. Michael Jackson. Do I like MJ, yea. Would I pay 5 dollars a song? Hell no, I'd go straight to LimeWire.


I think the companies that are going to complain the most are the ones that have the crappiest artists, as they have the most to lose. There isn't as much hype control as their used to be. Why should I have to pay $15 when all i want is 1 or 2 songs. I don't want to listen to the rest of your crap assed music that you stuff a CD with just to make a sale. Records companies do it on purpose, putting 1 or 2 good songs on a CD filled with throwaways that they can't promote as singles or at all for that matter, because they're just that...throwaways.

Being able to purchase song by song just makes an artist have to produce something the public wants to hear. If it's a bad song, I don't care if it's 1 cent, if I don't like it, why the hell would i want it. If i rip a CD into iTunes, I don't rip all the tracks just because I can, or just to inflate my library.

Vanilla
Apr 24, 2006, 02:09 AM
Maybe they could introduce variable pricing under the trojan horse of variable AAC rates?
Offering the same file at 99c for 128kbs & say $1.29 at 192kbs, and so on would I assume have the potential to generate higher levels of profit for both Apple and the record label and place the cost/benefit decision for paying more per track firmly in the hands of the consumer, rather than the record label.

Just a thought
Vanilla

milatchi
Apr 24, 2006, 02:17 AM
99˘ is the sweet spot. I am almost certain the Record Compnies are not going to go below it. Especially, now that they've established people will pay it. Going above 99˘ Will just turn people off to the idea of online music purchasing, and encourage piracy.

conradzoo
Apr 24, 2006, 02:21 AM
For what its worth I already pay $1.23399 but hey I am living in the Netherlands.

Anyway, I stopped buying cause the sound quality just didn't do anymore.
Music should rock and a 128kbs rip doesn't.

Stella
Apr 24, 2006, 02:24 AM
Prices should be *lower*.

The music industry has no duplication costs, no media costs.. but yet then get the bulk of the profits. Its all profit. They should also give up some of their profits to give to the artists too.

Actual CDs are cheaper to manufacturer, so why on earth do CD albums cost more than Tapes?!!!!

Ripping off music, they are taking the consumer for a ride.

j26
Apr 24, 2006, 02:48 AM
Maybe they could introduce variable pricing under the trojan horse of variable AAC rates?
Offering the same file at 99c for 128kbs & say $1.29 at 192kbs, and so on would I assume have the potential to generate higher levels of profit for both Apple and the record label and place the cost/benefit decision for paying more per track firmly in the hands of the consumer, rather than the record label.

Just a thought
Vanilla


That sounds like a logical progression to me. And ultimately, a lot of people would voluntarily pay for the extra to get the better quality.

asternke
Apr 24, 2006, 02:56 AM
I would pay more for a higher bit rate. Definitely.

asternke
Apr 24, 2006, 02:58 AM
If the record labels did increase the price, I believe Apple would just take the hit and keep selling songs at 0.99. They hardly make money on the iTMS anyway, it is really there to sell iPods.

50548
Apr 24, 2006, 03:06 AM
That sounds like a logical progression to me. And ultimately, a lot of people would voluntarily pay for the extra to get the better quality.

Yep, that's a much more reasonable solution for both parties...99c may be regarded as the sweet spot for 128 AAC, while $1.xx could be the price for high-encoding songs; it would be a legitimate solution in the eyes of the customer audience, and also provide slightly higher value for the greedy bastards in the recording industry.

Besides, SteveJ wouldn't be seen as bowing down to the labels...the basic fixed formula would be there with no changes...seems like an expected outcome to me.

p.s.: who could possibly vote "negative" for these news?? Is there anyone working for the labels in this forum? :eek:

netdog
Apr 24, 2006, 03:15 AM
Am I the only one who wants Apple Lossless files? Heck, 44.1 is crappy enough as a baseline. Do you guys really want to only have formats online that rejigger that to sacrifice even more resolution? Let's have a lossless option. I would pay a little more for it. Wouldn't you?

50548
Apr 24, 2006, 03:34 AM
Am I the only one who wants Apple Lossless files? Heck, 44.1 is crappy enough as a baseline. Do you guys really want to only have formats online that rejigger that to sacrifice even more resolution? Let's have a lossless option. I would pay a little more for it. Wouldn't you?

Simple, man...lossless is still too big to be sold as a downloadable file on iTMS.

c-Row
Apr 24, 2006, 04:22 AM
Simple, man...lossless is still too big to be sold as a downloadable file on iTMS.

There are online shops like Beatport [1] who legally sell complete WAV files. Not for 0.99$, though, but at a reasonable price compared to the file size and audio quality. However, they certainly won't produce as much traffic as the iTMS.


[1] www.beatport.com

(L)
Apr 24, 2006, 04:50 AM
Stay strong Steve! The greedy record labels will never quit.

It is very important that Apple keep every song at $.99.

I wish these darn record labels would stop being so greedy. When iTunes first came out, they saw Apple as their savior against pirates. iTunes has sold 1 billion songs since then, so that's 1 billion songs not pirated.

They should bow down to Apple!

Umm, hmm, no. Lol. For one thing, displays of gratitude should not be in that form.

And no, there's nothing wrong with record companies being greedy. Quite frankly, they may just be being stupid. That song you heard about from a friend? $0.99 = Just a click away. $1.29 = Let me think about that...maybe I can "borrow" it from my friend instead? Etc. My obvious point is that iTMS capitalizes on several points, taking one away being highly detrimental:

1) convenience - DUH. This is a reason record labels are grateful to Apple. To prove it, they provide their music for mutual profit. Greed made this happen, for all you silly ones that think greed is pure evil.

2) Apple design and ease of use - Sure, it's not as easy as it could be, but then, the ease of use does mean easy to buy, to spend, to make money off of. The competition is simply unsightly.

3) Pricing. #s 1, 2, and 3 all go together in making it easy to buy from iTMS. #1 puts the products right in the customers' homes. #2 makes it easy (and quick!) to purchase once the customer is ready to buy. #3 makes them ready to buy by giving them a golden deal that is rarely "too much."

Now honestly, I'm entirely against selling products for less than what consumers are perfectly willing to pay. But, given the phenomenal success of iTMS, which is only partly because of capturing the online market, I am willing to bet that raising the prices on some of those songs would inevitably have far less people purchasing them as an effect, over time (that is, counting the increase in). In other words, Jobs doesn't need to do the impossible and convince them to do the world a service and sell "music" (quotes since it aint even CD quality) for less than it's worth - instead, he simply has to show the record companies that their idea could easily produce a loss. Not to mention, be a pain in the butt to implement, possibly causing mistakes, pricing difficulties, slowing it down, lawsuits, or worse. No, rather, you can capture the online market AND get a bit extra by enticing people with the 99 cent price tag. It's simple math, really. So you make more money if you charge 1.29? No, not really. That's only 30 cents of a difference...in other words, 3 people buying at 1.29 is still less than 4 people buying at 0.99. And, $0.99, you don't have to think about, so that fourth person is much more likely to purchase.

In short, Steve's way makes us pay more. If you are going to get yer socialist talk goin and start pointing to greed as if it is evil, ask yourself if you've ever bought anything. If you did, was it really worth the money? Where did that money come from? Why isn't every product free? Aren't all material goods worthless anyway? The answer to that last one is most definitely no. Thus, Steve wants to capitalize on it, and he would rather that those simpleton record labels stay out of his way so that they can both make more money. The record label higher ups are probably somewhat insecure about the online market even now, but holy poop, their plans would cripple iTMS! What in the heck are they trying to accomplish?

And in the first place, I pay extra and buy the CD's, being a spoiled audiophile. (But from my perspective, it would even be insulting to see Britney Sphears or Fug Daddy or whatever easy entertainment being dished out by word of mouth cost more than music that sells itself simply because it is good, and doesn't get a bonus for being a social identification catalyst among teenie boppers. Lol...Fug Daddy.) But of course, that kind of thinking (that pricing would be insulting, etc) is absolutely beside the point. The point is that iTMS is making money well and the record labels don't recognize it's formula for success. That's not greed, that's just simply having poor business thinking. They probably are reluctant to listen to Jobs with any consideration because Jobs is that other computer guy with the short end of the stick. They need to learn to listen better - Jobs is talking bling bling.

(L)
Apr 24, 2006, 04:58 AM
Maybe they could introduce variable pricing under the trojan horse of variable AAC rates?
Offering the same file at 99c for 128kbs & say $1.29 at 192kbs, and so on would I assume have the potential to generate higher levels of profit for both Apple and the record label and place the cost/benefit decision for paying more per track firmly in the hands of the consumer, rather than the record label.

Just a thought
Vanilla

Umm, why would anyone happy with 192kbps not simply get 128kbps? I mean, yeah, I get your point, but there's way too many intervals for it to make sense. Rather, there should be two tiers. 99 cents for the so called "cd quality" that the masses are used to. 1.99 for the audiophile quality sounds ok to me. Now, audiophile quality is the upper limit, and really in the short term the only likely contender is Apple Lossless, for major business. That's not true audiophile quality, but if that's the limit, hey, it floats my boat. And, some people might even pay extra to have just their favorites be of higher quality, maybe. I'm not like that, so I wouldn't know. But maybe.

As for that being a way to side-step the record label stupidity...not really. It costs a lot of time and effort to get lossless on there, even more so to make an ugly, hairy system where you pay a different price for every 64kbps increase, which is just a mess. So, it's not something Jobs could use to side-step the media people. Rather, if he can pummel them into using their brains a bit more, he can have them making more money with him longer.

Demon Hunter
Apr 24, 2006, 05:04 AM
p.s.: who could possibly vote "negative" for these news?? Is there anyone working for the labels in this forum? :eek:

There are, in fact, 32 of us... ;)

But really, this is horrible for the iTMS. At best, it will generate media interest, and Apple will be hailed as an underdog, and play off the public animosity towards record companies. What if it doesn't work?

If one label pulls out, there could be a domino effect, resulting in huge losses as shareholders sell. It would be a free-for-all with competitors like Sony's CONNECT swiping up market share, while every bitter DAP manufacturer would feed like vultures on the iPod. Horrifying enough? :p

The situation in France doesn't help.

Fawzi
Apr 24, 2006, 05:07 AM
Maybe they could introduce variable pricing under the trojan horse of variable AAC rates?
Offering the same file at 99c for 128kbs & say $1.29 at 192kbs, and so on would I assume have the potential to generate higher levels of profit for both Apple and the record label and place the cost/benefit decision for paying more per track firmly in the hands of the consumer, rather than the record label.

Just a thought
Vanilla

What I often do is buy from iTunes and then go download "illegally" at higher bit rates.
I get a clear conscience, I encourage artists that I feel are worth encouragement, and I get the nice PDF that comes with the album.
If the price were higher for higher bit rates I would still do the same...

Is that illegal since I already own the rights ? (Well perhaps not for me since I live in Canada...)
Would this mean that it would be legal for me to download from P2P networks songs that I already have on cassette or vinyl (speaking hypothetically since I don't have any vinyl anymore) ?

MrCrowbar
Apr 24, 2006, 06:19 AM
Anyway, I stopped buying cause the sound quality just didn't do anymore.
Music should rock and a 128kbs rip doesn't.

Amen. I thought the previews were in lower quality than the stuff you buy (never bought anything on ITMS) but then I read it's the SAME "high" quality as the purchased songs. I'm just not willing to pay anything for this kind of quality. Apple Lossless would be fine or maye even the real uncompressed .WAV files. Apple did buy some massive storage rumored to go for the Movie Store. I'd love it if they used it to store uncompressed CDs so when you download a song, you get a 128kbit for your iPod and the uncompressed CD track for 0.99$ so you can listen to it on a Stereo or decent headphones.

I think I'll really stick with piracy and get the uncompressed CDs and buy it on iTunes if I like one enough to support the artists.

Bern
Apr 24, 2006, 06:44 AM
Well knowing the greedy record companies here In Australia I wouldn't be surprised to see a price hike. :(

Demon Hunter
Apr 24, 2006, 06:54 AM
Amen. I thought the previews were in lower quality than the stuff you buy (never bought anything on ITMS) but then I read it's the SAME "high" quality as the purchased songs. I'm just not willing to pay anything for this kind of quality. Apple Lossless would be fine or maye even the real uncompressed .WAV files. Apple did buy some massive storage rumored to go for the Movie Store. I'd love it if they used it to store uncompressed CDs so when you download a song, you get a 128kbit for your iPod and the uncompressed CD track for 0.99$ so you can listen to it on a Stereo or decent headphones.

That would be so great. And they need to be more consistent with those Digital Booklets. Apple Lossless and Digital Booklets, where do I put in my bank account #? :D

50548
Apr 24, 2006, 07:00 AM
There are, in fact, 32 of us... ;)

But really, this is horrible for the iTMS. At best, it will generate media interest, and Apple will be hailed as an underdog, and play off the public animosity towards record companies. What if it doesn't work?

If one label pulls out, there could be a domino effect, resulting in huge losses as shareholders sell. It would be a free-for-all with competitors like Sony's CONNECT swiping up market share, while every bitter DAP manufacturer would feed like vultures on the iPod. Horrifying enough? :p

The situation in France doesn't help.

Sorry, but your apocalyptical scenario is a bit too much in this case. The news says: labels are probably accepting Jobs's terms. So if they do, it means we're gonna have an agreement for both parties for at least a couple of years...

Your "if it doesn't work" scenario would give birth to another piece of news, not the current one...

Besides, what ya mean by shareholders? Apple shareholders? Come on...iTMS is just a tiny fraction of Apple's profitability...as long as iPods and Macs are sold (and they are NOT only sold because of iTMS), Apple stocks are fine, thank you...:rolleyes:

monkeyandy
Apr 24, 2006, 07:02 AM
I know this is a bit unrelated but the Apple Store is down! Getting updated! :eek:

Demon Hunter
Apr 24, 2006, 07:10 AM
Sorry, but your apocalyptical scenario is a bit too much in this case. The news says: labels are probably accepting Jobs's terms. So if they do, it means we're gonna have an agreement for both parties for at least a couple of years...

Your "if it doesn't work" scenario would give birth to another piece of news, not the current one...

Besides, what ya mean by shareholders? Apple shareholders? Come on...iTMS is just a tiny fraction of Apple's profitability...as long as iPods and Macs are sold (and they are NOT only sold because of iTMS), Apple stocks are fine, thank you...:rolleyes:

I know, was having a bit of fun. ;) But I do think iTMS needs to stay on top, if Apple's momentum is going to continue. And we know it will!

KindredMAC
Apr 24, 2006, 07:42 AM
uh huh

cxny
Apr 24, 2006, 07:46 AM
Could there be a more despised segment of US industry than the record companies? (OK the oil companies a close second right now) Actually I would be happy to see tiered pricing but only if $0.99 was the upper limit and older back catalog was made available at $0.50.

(L)
Apr 24, 2006, 07:55 AM
...but, I am not impressed.

Sure, it must be really powerful. But 17" in a laptop and no 12"? Ayeah. No really, I'd be fine with this if it looked like a 12" were on the way.

Lol...check out the comparison between the 15" and 17" at the hardware site. (http://www.apple.com/macbookpro/) Hmm...not really that big of a difference on the browser...but monstrous in the store. What ever happened to small and sexy?:p

barakthecat
Apr 24, 2006, 08:03 AM
I don't know why everyone is against tiered pricing, it's a great idea.

$0.33, $0.50, or $0.99 per song

If the recording industry is worried about revenues, how about going back to the model of supporting an artist for a long career. I just went to see Billy Joel with my mom this weekend. Not only has my whole family been buying Billy Joel albums for almost 30 years, but when my sister and I moved out on our own, we bought our own Billy Joel albums to own. A new album from an established artist goes a long way towards selling itself. It's probably a heck of a lot cheaper to support an existing good artist, then it is to keep promoting a throwaway flavor of the month.

Looking at my iTunes collection, I average 5 albums per artist in the 60s and 70s, and that drops to 2 in the 80s, and less than 1 from the 90s on. Why is that? Because most things today are flavor of the month crap that I wouldn't buy at $0.01 per song. I lament the fact that in 30 years, there won't be an artist still performing live that my whole family loved and could share a great night at a concert listening to.

coumerelli
Apr 24, 2006, 08:11 AM
Sell it to me for $12.99 and ship me the CD too - I'd do that. Heck, for $14.99 I'd do it. Saves me from having to rip it and find the album art. Apple needs to do this with music as a test market so when they release full length movies, it'll be in place to ship DVDs with each purchase.

Keep the .99 tracks tho

(L)
Apr 24, 2006, 08:12 AM
Could there be a more despised segment of US industry than the record companies? (OK the oil companies a close second right now) Actually I would be happy to see tiered pricing but only if $0.99 was the upper limit and older back catalog was made available at $0.50.

But would you buy 2x as many songs? Or are you just saying you want stuff to be cheaper? See, because iTMS is a phenomenal success, with no apparent need to lower prices or raise them up.

By the way, have you ever tried producing a REAL cd? How about pump some oil? Exactly. You know, those people do work hard. It's not like they were born with the magical ability to produce stuff you want and aren't willing to pay for, or only pay for while "despising" them. Is it just because I'm talking to teenagers that there is this general air of "I don't want to pay up to the value of goods"? (:D Duh, of course.)

Well, maybe you are a cd producer dj thing on the side and take insult. Whatever. People that don't understand pricing and value shouldn't just flap their mouths demanding cheaper goods. On the other hand, if iTMS were not such a success and Apple really was charging too much, I would agree with you entirely, since consumers have the right to pay exactly what they think an item is worth, so long as the seller agrees to it. This is why you can negotiate at BestBuy or whatever for $200 off that big screen TV, but you can't hurl $200 less than the price tag at the employee and proceed to steal the TV. In this case it's a bit different. iTMS is selling tracks at $1, essentially. In theory, there is some price point at which they'd make the most profit. Unfortunately, people will actually hesitate more to buy tracks priced at $0.72 than at $0.75, or even at $1, probably, and anyway they'd hesitate a whole lot more at $1.49 or whatever. That period, when the customer is deciding whether or not to click on buy, is the most important piece of this equation. Hesitation is to be avoided. So, I wouldn't be surprised if iTMS's current price of $1 is also the theoretical optimum. To lower the price makes no sense, and to introduce variable pricing or tiered pricing means the same thing - missing the theoretical optimum by more than the current pricing does, to be sure.

Let's not bash oil companies because we pay them for their work. Instead, let's bash them because they hold government sway and the great US of A was never meant to be controlled in any large part by a group of corporations. There's a difference - as a business they should charge what they can and make a profit...as a govenment influence, they should hold no more sway than an equal number of voting individuals...instead, look what we get! :mad:

(L)
Apr 24, 2006, 08:25 AM
I don't know why everyone is against tiered pricing, it's a great idea.

$0.33, $0.50, or $0.99 per song

If the recording industry is worried about revenues, how about going back to the model of supporting an artist for a long career. I just went to see Billy Joel with my mom this weekend. Not only has my whole family been buying Billy Joel albums for almost 30 years, but when my sister and I moved out on our own, we bought our own Billy Joel albums to own. A new album from an established artist goes a long way towards selling itself. It's probably a heck of a lot cheaper to support an existing good artist, then it is to keep promoting a throwaway flavor of the month.

Looking at my iTunes collection, I average 5 albums per artist in the 60s and 70s, and that drops to 2 in the 80s, and less than 1 from the 90s on. Why is that? Because most things today are flavor of the month crap that I wouldn't buy at $0.01 per song. I lament the fact that in 30 years, there won't be an artist still performing live that my whole family loved and could share a great night at a concert listening to.

CDs are a bit different from the 128kbps excuses for music that iTMS sells (whoops bashing needs to be redirected...:D ). Anyway, tiered pricing isn't great unless it hits theoretical optimum prices better than the enticing 1 dollar mark, which it doesn't. Especially not at $0.33! Imagine...I want to try out a song, not caring about the 128kbps bit. I'd have to do that 3 times to equal one song I decided to try since "it's only a buck." In other words, $1 is good for just trying out a song, then people might buy the album, or buy individually, it's all good. People buying music they know they like will likely buy like many tracks, like, you know? (:D ) 1 dollar works both ways...individually, it's easy to trade to try a song. In groups, it's easier to purchase a bunch of music you like...17 tracks? No problem, $17, you can do it in your head. If they were $0.50, for example, you can still do it in your head, but you would have to buy double for iTMS to make the same amount of money. In between, the numbers aren't as manageable, not just for calculating checkout totals, but more like throwing the idea around...like 17 tracks...well, why not 3 more, to make a clean 20? Compared to 17 times 0.87...that's...umm, should I buy more or take off a couple of tracks? Not manageable, not without having to stop and think about it. You don't want customers to stop and think about it for very long at all, so you charge them a buck a piece and everyone's happy.

princealfie
Apr 24, 2006, 08:43 AM
also, not those evil music companies again? :eek: how much greed can we sustain?

seashellz
Apr 24, 2006, 12:34 PM
If the companies were making little profit-they would be glad for the buck-a-song;
But they are getting rich from APPLE -and when that happens they want to get RICHER-greed is what is driving them;
"Our poor artists starve on a $.99 song"
*********! The artists sees little of it.

Company execs cannnot afford quite as many hookers, trips to the Caribbean, or new Mercedes Benzes this way-THAT is why they are whining. Knock 'em out Steve!

Fukui
Apr 24, 2006, 12:44 PM
I don't know why everyone is against tiered pricing, it's a great idea.

$0.33, $0.50, or $0.99 per song

Thats not exactly what they had in mind...
Maybe something like....

Crappy songs no one listens to anyways: $0.50
Ok songs, semi popular: $0.99
Popular songs, most songs on iTunes: $1.50
Newest releases, stuff people want: $1.99

If for one would rather have uniform 99 cents. Because otherwise, the above (in my post) is more likely what you'll get.

blueimac'00
Apr 24, 2006, 05:24 PM
Ah, the NYPost. The most reliable source of info on the planet, at least, when they're not extorting people (http://www.usatoday.com/life/columnist/mediamix/2006-04-10-media-mix_x.htm).

agreed.

Detlev
Apr 24, 2006, 08:56 PM
But on the other hand, when do suppliers tell retailers what to CHARGE for goods?
Every day. They've gotten creative in how they do it, that's all. Perhaps you meant the specific and unlawful act of "price fixing".

reidster
Apr 24, 2006, 09:09 PM
I totally agree with the sentiment that increasing prices will cause an exponential growth in piracy. The record companies are trying to find more scapegoats to blame the results of their greed upon, firstly the pirates, now the source of over 80% of online music sales.

The bitrate discussion is interesting. I would really like to see Apple embrace AACplus in the future. The far superior compression provides quality I associate with 256kbps MP3 at 96kbps, and 320kbps MP3 at 128kbps. I can see the issue with multiple pricing/bitrate levels might be that purchasing music would become more complicated as a result- something very un-Apple. Moving entirely to a higher bitrate could alienate many people on lower bandwidth connections -iTMS might not be so quick and easy for a lot of customers. AACplus could be key in that it offers much higher fidelity audio at the same bitrate, or similar quality at a much lower bitrate. (hello mobile iTMS) I can see that there are a lot of hurdles in the way of providing AACplus content, the major one being that existing iPods do not support it and might not have the performance necessary to decode it even if it could be implemented through firmware. Still, I think it would be a major step towards satisfying the need for a balance between fidelity and bandwidth/disk conservation.

kenaustus
Apr 25, 2006, 11:41 AM
Record companies face some interesting problems.

If they pull out of itunes what are they going to say to their top "artists" who are pulling in the big bucks? Could these artists get THEIR lawyers to go for the lost revenues of not being on iTunes? Or would it just be easier to make it public that they are changing labels when they can as they want too be on iTunes?

Second is financial reality in marketing. Not everyone can afford all of the CDs they would like to have and, for many, it is one or two songs a week - if they are lucky. iTunes works well in this market - it lets the kid get a song or 2 from the CD of his favorite band when he (or she) doesn't have the money for the full CD.

The there are the bargain CDs. It's actually worth going through those as there can be some great CDs that the companies are clearing out of the warehouse. I found a copy of Ella in Berlin - an album I hadn't seen since the 60's. Got it for $5.99 and, yes, it's available on iTunes for a lot more. Like Ella Fitzgerald there is a lot of great music available on iTunes that aren't in the record company's warehouses any more. iTunes has become the primary (or only) source of revenue for these albums. For many albums the bargain bins are simply for clearing out warehouses and giving up on additional revenues. Pulling out of iTunes stops that revenue stream no matter how small.

The record companies simply can't win against Apple. If they pull out of iTunes they have problems. If they get higher prices for some music they will also get lower unit volumes on the higher priced music. The consumer will also want to see some deep discounts for older, slower selling music.

hondaboy945
Apr 25, 2006, 01:53 PM
One thing I would like to see is the option for the iTunes user to download the songs or get the album sent to their house. I love my iTunes and all of the features, but I think that this would be a great idea. I see the idea that the record labels are not sending apple actual CD's so there is les of an expense, but some of us still would like the option. Yes or No?

ioinc
Apr 25, 2006, 10:01 PM
Man the record comanies are just crazy for wanting supply and demand to set the price of their songs.

Crazy I say.... to make people pay more for the goods and services they want... it will never work.

Atlas Shurgged:p