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MacBytes
Oct 30, 2007, 12:00 PM
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Category: Opinion/Interviews
Link: "Apple Has Destroyed the Music Business" (http://www.macbytes.com/link.php?sid=20071030130041)
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Posted on MacBytes.com (http://www.macbytes.com)
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Drumjim85
Oct 30, 2007, 12:04 PM
"It wasn't just about experimenting on the price points for digital downloads. NBC was also asking for a cut of Apple's iPod sales, at least at some point in the negotiations."


Apple has done nothing but to help the music business.... its the Big 4 that are destroying it (and themselves)

HyperZboy
Oct 30, 2007, 12:20 PM
If a tree falls in the woods and nobody is there to hear it, will anybody be buying advertising in the forest?

That's my opinion of Hulu.com. None of these companies "get it".

NBC Universal will come crawling back to iTunes or Amazon after eventually folding Hulu.com just like Sony did with it's music service. It'll be interesting to see what Zucker's excuse is a year or 2 from now when the thing bombs and he has to explain to stockholders why he cost NBC Universal so much money in lost sales.

elppa
Oct 30, 2007, 12:20 PM
Hilarious!

iTunes Store is the only widely adopted legal download website. Not only that, the Record Labels get a huge cut for the sales.

Would they rather people resorted to piracy?

amancalledsun
Oct 30, 2007, 12:24 PM
Apple destroyed the music business? I don't think so. You can't have a business without a product or services, so we first need to examine who destroyed music to understand who destroyed the business based on it.

It's obvious to anyone with half a brain that the major players at fault with destroying music are, in order: (1) the media, for continuing to give air time and "celebrity" news to people who are doing nothing to further music as an art, (2) Anteres Audio Technologies, for creating the the auto-tuner, thereby allowing Britney et al. to record trash that somehow magically stays in tune and on key (even while performing it live), and (3) the public for not noticing that (1) is actually the same marketing machine that promotes this narrowing, talentless field of hacks. It is rare indeed these days to find any worthwhile music being put out by a major label.

Given the evidence, is it any wonder that people have finally stopped buying crap? So, the major labels and their mainstream media affiliates ("NBC Universal", anyone?) have destroyed music. And somehow they expect to still have a business selling a product of ever-decreasing quality. No, Apple didn't destroy the music business.

Peace
Oct 30, 2007, 12:24 PM
If a tree falls in the woods and nobody is there to hear it, will anybody be buying advertising in the forest?

That's my opinion of Hulu.com. None of these companies "get it".

NBC Universal will come crawling back to iTunes or Amazon after eventually folding Hulu.com just like Sony did with it's music service. It'll be interesting to see what Zucker's excuse is a year or 2 from now when the thing bombs and he has to explain to stockholders why he cost NBC Universal so much money in lost sales.

NBC is still using Amazon.

kkat69
Oct 30, 2007, 12:27 PM
Apple and iTunes were a pioneer for the music industry. In fact more people are breaking out IN the music industry due to iTunes (ie., typically called noName Bands)

Steve Jobs has a simple business model and it's just that. "Keep it simple"

The other companies and music companies want to much money.

Some people say "why do I have to pay 99c for a song that's 50yrs old?" Well if you can't find that song I think 99c is a deal or goto eBay and bid on the album.

There's always the piracy route via torrents etc. But for those of us who are somewhat honest :rolleyes: I don't see 99c a big deal. If fact it almost works out the price for a full album on iTunes and in Walmart the cost is almost the same (well not really but it's pretty close).

Experiementing with the Video is one thing, but to label the article "Apple Has Destroyed the Music Business" and all they talk about is experimental with the price of video's just entices rage against iTunes.

I think iTunes is doing the best job it can with what it has. Sure they need more shows and more complete seasons *cough*enterprise: seasons2-4*cough* but they are also at the mercy of the people who own the rights for distribution. If they won't give iTunes the shows, iTunes can't show them (and people don't understand that and still blame iTunes)

Keep up the good work iTunes.

ViveLeLivre
Oct 30, 2007, 12:48 PM
Idiot.

I might not like $.99 per song without exceptions or competition, but I haven't downloaded an illegal MP3 since I bought my iPod. The record industry wouldn't have received a penny for my downloaded songs in any other way. Frankly, my use of the iPod and iTunes has only increased the rate at which I purchase CD's, since I'm no longer discouraged by the pain/fear of buying bad albums.

calculus
Oct 30, 2007, 12:54 PM
The Music Business (whatever that is) is destroying itself by releasing rubbish records by rubbish acts...

macFanDave
Oct 30, 2007, 01:11 PM
of the Dumbest Comments of All Time.

It's going right there among "Everything that can be invented has been invented" and "Steve Jobs ought to shut down Apple and give the money back to the shareholders."

I feel sorry for poor Mother Zucker.

notnek
Oct 30, 2007, 01:12 PM
If iTunes did anything, it saved the music industry from taking a deep dive into the piracy sea without a lifejacket. NBC will be back, even if it takes Apple and NBC compromising to make the deal.

Markleshark
Oct 30, 2007, 01:15 PM
Would they rather people resorted to piracy?

No, but they still have the audacity to wonder why. :rolleyes:

zombitronic
Oct 30, 2007, 01:18 PM
Wanna screw the music industry? Never buy a new CD again. Borrow (from friends or the library) or buy a used CD, rip it to your computer (in a higher quality than iTunes sells,) and return it or sell it back to the used record store that you bought it from. The industry gets no additional revenue, you end up paying less than 99 per song (when you sell the album back,) and you support you local used music retailer.

And Apple still sells millions and millions of iPods.

Wild-Bill
Oct 30, 2007, 01:20 PM
The Music Business (whatever that is) is destroying itself by releasing rubbish records by rubbish acts...

Well said.

And the only thing being "destroyed" is greedy record executives' wallets.

rikers_mailbox
Oct 30, 2007, 01:26 PM
And the only thing being "destroyed" is greedy record executives' wallets.

You got it. The only thing destroyed was the big labels' ability to fleece customers. Music is overpriced and far too controlled by record labels and their agenda. Apple is bringing power, distribution, and content creation back to the artist.

I'm glad Apple destroyed the music business.

jklps
Oct 30, 2007, 01:53 PM
I've loved and participated in music for much longer then being an Apple person and think this statement is crazy.

To put in perspective, if given the choice I'd give up Apple computers 100 times before giving up music.

Thankfully I'll never have to.

Ugg
Oct 30, 2007, 02:04 PM
The time has come for Apple to work with the labels. The idea of one price for all songs is pretty stupid. What record store do you know of doesn't sell different albums at different prices? Yep, you got it, none.

What Apple needs to do is offer something like this:

$7.99 per album or $.79 per song for the second rate stuff.

$9.99 per album or $.99 per song for strong selling stuff.

$11.99 per album or $1.19 per song for hot new releases.

All music isn't created equal, nor should it be sold all for the same price. It's really stupid on their part not to show some flexibility. They've got the market sewn up, now is the time to expand it, not shrink it.

However, I do agree that Zucker and all the other label CEOs are incredibly stupid. Why bite the hand of the only company that is showing them the way forward?

They're all going to regret their pomposity in the end.

jklps
Oct 30, 2007, 02:12 PM
The time has come for Apple to work with the labels. The idea of one price for all songs is pretty stupid. What record store do you know of doesn't sell different albums at different prices? Yep, you got it, none.

Actually if a somewhat decent band that is actually on a label comes out with a new album it's usually cheaper that first week at the wonderful Best Buys and Circuit S%*ty ...to get people into the store to buy something else...like 11.99.

baleensavage
Oct 30, 2007, 02:43 PM
of the Dumbest Comments of All Time.

It's going right there among "Everything that can be invented has been invented" and "Steve Jobs ought to shut down Apple and give the money back to the shareholders."

I feel sorry for poor Mother Zucker.
Oh yeah, definitely one of the dumber things that have been said. I don't know who he's kidding but Apple saved the music industry's keister. Before iTunes, there was Napster (the illegal one). Yup that's right and the music industry was failing before iTunes came along. Now digital music is thriving and Apple is at the forefront. The music industry is just jealous that Apple has been so successful. They want all their money to themselves. If iTunes killed the music industry then iTunes would have been dead long ago.

jklps
Oct 30, 2007, 02:59 PM
Oh yeah, definitely one of the dumber things that have been said. I don't know who he's kidding but Apple saved the music industry's keister. Before iTunes, there was Napster (the illegal one). Yup that's right and the music industry was failing before iTunes came along. Now digital music is thriving and Apple is at the forefront. The music industry is just jealous that Apple has been so successful. They want all their money to themselves. If iTunes killed the music industry then iTunes would have been dead long ago.

It's harder to hide BS profit now without actual physical distribution too....

MacSween
Oct 30, 2007, 04:20 PM
It's harder to hide BS profit now without actual physical distribution too....

As a distribution model iTunes has to be better than hardcopys like CD's or DVD's. There is no media production cost, no inventory to maintain, no shipping cost. A single digital copy just sits there until somebody decides that they want to purchase it. Then a new copy is created from nothing and downloaded to a PC/MAC.

The purchaser provides their own media!! How much better can it get for the Music industry????

They just want to be able to charge the same price as they did when they also provided the media. That translates into HUGH profits.

Naimfan
Oct 30, 2007, 04:57 PM
The Music Business (whatever that is) is destroying itself by releasing rubbish records by rubbish acts...

Exactly correct.

buy a used CD, rip it to your computer (in a higher quality than iTunes sells,) and return it or sell it back to the used record store that you bought it from. The industry gets no additional revenue, you end up paying less than 99 per song (when you sell the album back,) and you support you local used music retailer.


Yep, that's what I mainly do. Of course, I still have five thousand LPs to rip........

jettredmont
Oct 30, 2007, 05:07 PM
The time has come for Apple to work with the labels. The idea of one price for all songs is pretty stupid. What record store do you know of doesn't sell different albums at different prices? Yep, you got it, none.


What iTunes Music Store do you know of [which] doesn't sell different albums at different prices? Yep, you got it: none.


What Apple needs to do is offer something like this:

$7.99 per album or $.79 per song for the second rate stuff.

$9.99 per album or $.99 per song for strong selling stuff.

$11.99 per album or $1.19 per song for hot new releases.

All music isn't created equal, nor should it be sold all for the same price. It's really stupid on their part not to show some flexibility. They've got the market sewn up, now is the time to expand it, not shrink it.


How does this "expand" the market?

The current situation is great. I hear a song I like, I know it will cost me $0.99 to buy. No bargain hunting, no dickering, no fine print. 99 cents. One buck. That's it.

If I like an album, a little more money's at stake. I tend to bargain hunt there (or, rather, wait it out for a sale). Still, I end up not buying more albums than I impulse-buy because of this. I have found that most of the time these days I follow the iTunes model: download the songs I've heard and like individually, then if I decide I still like the band and what they're doing a week later, buy the rest of the album for a few bucks more (significantly cheaper than buying the CD, even from a discount bin, and a lot less hassle).

In your model, you introduce doubt. If I like this song, what are the chances the label considers it a "hit"? What would compel the label to put out anything other than "hits", for that matter? This is way too much thinking to do over a single 3-minute song. This isn't a car purchase. This is an entertainment purchase. If I spend as much time dickering over the price as I do listening to the song, something is seriously wrong with the world!

Go to Home Depot some day. Look at the wall of little packets of screws and washers and nuts and bolts. Do you see variable pricing there? No. Every packet (which may contain different counts of the hardware) has the same price. They contain differing amounts of raw metal (although similar) and thus cost quite different amounts to produce. Still, they're all priced identically. There's no reason to dicker over the $0.79 you are spending there. Now, turn around and look at the larger boxes of the exact same hardware. Notice anything? That's right: the large-quantity boxes are carefully priced, almost as many price points as there are different SKUs!

This is a common economic model. Once you start dealing with micro-payment sized transactions, uniformity is more influential to market share and overall market growth than point savings introduced at the cost of price variability.

Rodimus Prime
Oct 30, 2007, 05:34 PM
Wanna screw the music industry? Never buy a new CD again. Borrow (from friends or the library) or buy a used CD, rip it to your computer (in a higher quality than iTunes sells,) and return it or sell it back to the used record store that you bought it from. The industry gets no additional revenue, you end up paying less than 99 per song (when you sell the album back,) and you support you local used music retailer.

And Apple still sells millions and millions of iPods.

you know by doing that you are also priating. When you return/sell the cd used you are supposed to delete any music you ripped. So going that route you are still pirating music

leekohler
Oct 30, 2007, 05:51 PM
The music business destroyed the music business. Their first bad move was going after Napster. That was the beginning of their end. Instead of embracing new tech and using it to their advantage, they tried to squash it.They could have done all sorts of things through Napster, now they'll have to do it through iTunes.

The record industry also inflated their prices, making iTunes all that more attractive. If they wanted to compete, they blew their opportunity and underestimated the consumer. It's their own fault, plain as day.

Drumjim85
Oct 30, 2007, 06:03 PM
The music business destroyed the music business. Their first bad move was going after Napster. That was the beginning of their end. Instead of embracing new tech and using it to their advantage, they tried to squash it.They could have done all sorts of things through Napster, now they'll have to do it through iTunes.

The record industry also inflated their prices, making iTunes all that more attractive. If they wanted to compete, they blew their opportunity and underestimated the consumer. It's their own fault, plain as day.

It happened before that.... The industry was about to fall, but then CDs came out, and people decided to buy all their old records on CDs ....

Yes, a big wound did happen around the digital (napster) age... but the industry has been struggling for a long time...

QuarterSwede
Oct 30, 2007, 06:45 PM
It's obvious to anyone with half a brain that the major players at fault with destroying music are, in order: (1) the media, for continuing to give air time and "celebrity" news to people who are doing nothing to further music as an art, (2) Anteres Audio Technologies, for creating the the auto-tuner, thereby allowing Britney et al. to record trash that somehow magically stays in tune and on key (even while performing it live), and (3) the public for not noticing that (1) is actually the same marketing machine that promotes this narrowing, talentless field of hacks. It is rare indeed these days to find any worthwhile music being put out by a major label.
Fantastic post! And yes, Auto-Tune is the bane of my existence.

Killyp
Oct 30, 2007, 07:35 PM
Fantastic post! And yes, Auto-Tune is the bane of my existence.

Agreed, I find autotune incredibly irritating when listening to the local radio (which I try not to do). My sister is into all the junky 'RnB' and Urban trash you get in the charts at the moment, and the autotune in it is so blatant it just annoys me. I wouldn't have a problem if they were good people with talent in some other field, because then their success could be vaguely justified. Instead we have idiots like Britney Spears and Kylie Minogue wasting radio playtime and making stupid amounts of money from something a 14 year old girl with a severe throat issue could still do.

The music industry only has itself to blame.

Lixivial
Oct 30, 2007, 09:00 PM
The time has come for Apple to work with the labels. The idea of one price for all songs is pretty stupid. What record store do you know of doesn't sell different albums at different prices? Yep, you got it, none.

As jettredmont aptly mentioned in his well-rounded post, the labels have, to my knowledge, always been able to mandate which price they wanted for purchasing the album outright and were allowed to reserve tracks/features/etc to help convince the buyer to make that jump. The complaint, as far as I was aware, was always the strict .99c a la carte option that iTunes made wildly popular.

From here (http://macdailynews.com/index.php/weblog/comments/7113/opinion/) (though I could have sworn I remember Steve Jobs saying the same):
Let's come straight to the point, forget about "variable pricing" issues, you can already set variable album pricing on iTunes, you can sell albums from $5.99 and up. The majors want to raise the prices for the new releases. They simply want to make more money now, which they are not denying and its fine with me. After all, music business is business and they have to answer to their shareholders

I can see the static pricing affecting the video side of things a lot more than the music side. And I do agree with some of these middle ground arguments that both sides need to get off their high horses. The cat fight is turning into a circus now, and certainly doesn't help when either side injects emotion into the "arguments." And the 'AA's should know that this proposal is a losing one, as demonstrated by the mass angst lobbed against them.

For his credit, Steve Jobs has already addressed some key consumer-related issues in the removal of DRM, and I believe that he's looking at this issue through those glasses. Until the labels step up to the plate in relation to universally applied DRM-free iTunes content I doubt he's willing to step up to changing the pricing structure.

Instead we have idiots like Britney Spears and Kylie Minogue wasting radio playtime and making stupid amounts of money from something a 14 year old girl with a severe throat issue could still do.

The music industry only has itself to blame.

I think that's irrelevant to the point at hand. The quality of music has remained static since the dawn of time; it's merely the quantity with which it's consumed that's changed. If the industry was flying high during the '80's, I would say that the quality of pop music is somewhat irrelevant to the death of the labels.

If there were a modern invention which "killed music" by your defined argument, it would be the phonograph.

hulugu
Oct 30, 2007, 11:46 PM
The time has come for Apple to work with the labels. The idea of one price for all songs is pretty stupid. What record store do you know of doesn't sell different albums at different prices? Yep, you got it, none.

What Apple needs to do is offer something like this:

$7.99 per album or $.79 per song for the second rate stuff.

$9.99 per album or $.99 per song for strong selling stuff.

$11.99 per album or $1.19 per song for hot new releases.

All music isn't created equal, nor should it be sold all for the same price. It's really stupid on their part not to show some flexibility. They've got the market sewn up, now is the time to expand it, not shrink it.

However, I do agree that Zucker and all the other label CEOs are incredibly stupid. Why bite the hand of the only company that is showing them the way forward?

They're all going to regret their pomposity in the end.

Simply put, I don't trust the labels. If Apple gives them some slack on this issue, I can't imagine they'll celebrate their hard-won victory by lowering prices. Instead, they'll immediately try to squeeze me for every last dime they can.

A tired pricing system makes sense if it were based on an actual relationship with demand, but the labels have long ago proven that they're more interested in being a cartel than a free-market enterprise.

As for Apple destroying the music business, that ship was already sinking;Apple was surprised as anyone when they fired a torpedo at the hurricane deck and hit below the water-line instead.

I was really hoping to use the word forecastle, but it just didn't work.

fisha
Oct 31, 2007, 08:57 AM
You got it. The only thing destroyed was the big labels' ability to fleece customers. Music is overpriced and far too controlled by record labels and their agenda. Apple is bringing power, distribution, and content creation back to the artist.

very similar to my thoughts.

It wasn't long into the CD era that i felt that the music industry was screwing folk over with the pricing . . . particularly with the price of a CD single. The prices were rocketing, and in more and more cases, i felt that the content of the CD was dwindling.

Then as CDR/RW came about, it became even more gualling that the cost of the CD material was next to nothing, that royalties took months to reach and artist and frankly, me the customer was being ripped off.


The music industries were far too slow to embrace alternative distribution methods . . . so screw them. Its not the fat cats that are the source of the music, its the artists, and if podcasts and reasonable fair pricing is the best way to let customers reach the music they want to hear ( as opposed to the music we are told to listen to by radio/media/marketed playlists ) then i'm all for it.

Even in the UK, the likes of Radio 1 on the BBC ( which purports to be independant / unbaised ) its blatantly obvious that they are being manipulated into big-upping bands / songs under influence.

awal
Oct 31, 2007, 10:54 AM
Buggy Whip Manufacturer: "Henry Ford has destroyed the buggy whip business."

I'm not an Apple apologist, but it doesn't exactly take a Harvard Business School MBA to see that the music industry was hugely broken prior to the emergence of the iTunes Music Store. It is not dissimilar for the distribution of video, but I think that Zucker is right that there is some room for experimentation.

The big question is has anyone ever tried to watch a show on NBC.com. It's an absolutely horrendous experience. I tried to watch an episode of 30 Rock, and between the commercials, frozen picture, break-ups, etc., I will never do it again. I would welcome the opportunity to pay $1.99 rather than watch that dreck for free.

ToneMonkey
Nov 1, 2007, 05:25 PM
In your model, you introduce doubt. If I like this song, what are the chances the label considers it a "hit"? What would compel the label to put out anything other than "hits", for that matter? This is way too much thinking to do over a single 3-minute song.

I think a better way to generate a pricing model would be on the basis of recent release vs. back catalog. Here's why...

Oh, new stuff might be worth $1 per song. And as with all manner of newly engineered things (prescription drugs are a great example), I support the manufacturer's right (even duty to the stockholders) to price things at a point that allows them to recoup their development costs in a realistic timeframe. So $1 per song for the latest Justin Timberlake, Beyonce, Brittany Spears drivel seems entirely appropriate, if not a bit masochistic.

However, back catalog stuff is an entirely different matter. Development costs were recovered decades ago. It costs almost nothing to post this stuff on a web server and milk it until the (cash) cows come home. The only rub is that most folks aren't going to pay $1 per song to download vintage Sam Cooke, Beach Boys, Motown, etc. But, they will pay SOMETHING to own it.

Personally, I see some definite parallels between today's music business and prohibition (and we know how well that worked). During prohibition, many folks owned stills. They couldn't legally buy liquor, so they made it illegally. A lot of money was expended producing illegal liquor. Similarly, these days folks clearly are willing to spend SOMETHING to own (not rent) music. Allofmp3.com, ripping software, extra storage, etc. all testify to people's willingness to pay SOMETHING. Just as when being able to readily buy high quality liquor any time one wanted to killed off the home still, being able to download known good quality music at a price the market will embrace will just as surely kill off illegal downloading and file sharing. It just won't happen at the $1 per song price point.

My personal collection is a tad over 10K songs. Most acquired via rip and flip, public libraries, with some Napster and Allofmp3.com stuff in there, even some iTunes and Amazon downloads. I would legally download more but too many songs still come with DRM and DRM-protected music is worthless to me. Overall, I've paid a LOT less than a $1 per song and wouldn't consider owning 50% of what I own at that price point. It just ain't worth it. But, I will pay 10 cents per song for it. Happily.

Finally, IMHO the real crime about lack of proper support for back catalog stuff is the number of starving artists from the 50s-60s-70s who would love to see any income at all from their catalog, but don't by and large because the record companies claim it isn't cost effective to release it (of course, they really mean cost effective to release it on physical media like CDs and sell it in brick and mortar stores).

My advice to the record companies: fire the lawyers, close the RIAA and move the decimal point. At between 10 and 20 cents per song, back catalog stuff would fly off the shelf in such volume that their bank accounts could scarcely hold all the profits. And NOBODY would bother pirating anything. Keep it at 1$ per song, and they are condemned to whine about the message the free market is sending.