Music Industry Fears Apple and is also Subject to iTunes Popularity Rankings

[MacRumors]

The NY Times reports on the heated negotiations that led to the announcement at Macworld that Apple would be dropping Digital Rights Management (DRM) from all iTunes music. In exchange, the music labels were given their long-requested variable pricing model. In addition, Apple was able to secure over-the-air iTunes music downloads for the first time.

Apple, however, was said to have a strong upper hand in the negotiations according to music executives:

In interviews, several high-level music executives, who spoke on the condition that they not be named to avoid angering Apple, said they operated in fear of Apple’s removing a label’s products from the iTunes store over a disagreement, even though that has never happened. The labels do not have much leverage in negotiating with Apple.

Steve Jobs, himself, was reportedly responsible for a particularly heated exchange with Sony Music on Christmas eve.

Also interesting is that Apple holds another powerful bargaining chip with the control over the iTunes homepage itself as well as the popularity rankings.

"Whether the industry likes it or not, the iTunes chart showing the most popular songs in America is a major influencer of how kids today discover and communicate with their friends what kind of music they like," said Charlie Walk, the former president of Epic Records, a unit of Sony Music. "It's a very powerful thing right now in American pop culture and immediately validates a hit song."

The influence of Apple's home page promotions and popularity charts has been the subject of much debate amongst App developers, but it seems Apple may be well aware of their impact.

Article Link: Music Industry Fears Apple and are also Subject to iTunes Popularity Rankings

[theheadguy]

This had to be stressing Steve out... I mean, come on, that heated on Christmas Eve?

[jayenh]

all sounds good to me. apple provide the best service for digital distribution of music. if they dont like it they can move on and use another service but lose customers.

same goes for the ratings, now artists get recognized because we like them, not because the record label wants them to be liked by us.

it's about time someone started sticking it to the music industry as far as i'm concerned.

[fishmoose]

Originally Posted by jayenh

all sounds good to me. apple provide the best service for digital distribution of music. if they dont like it they can move on and use another service but lose customers.

same goes for the ratings, now artists get recognized because we like them, not because the record label wants them to be liked by us.

it's about time someone started sticking it to the music industry as far as i'm concerned.

Well said! If it wasent for iTunes piracy would be an ever bigger problem then it is already imho!

Now we just need Apple Lossless in iTunes store and were good to go!

P.S what ever happend to The Beatles in iTunes store, have Apple given up on that one? I would love to have it there! I already have all the CD's and some LP's but anyway..

[gnasher729]

Originally Posted by fishmoose

P.S what ever happend to The Beatles in iTunes store, have Apple given up on that one? I would love to have it there! I already have all the CD's and some LP's but anyway..

Looks like everything by Paul McCartney is on iTunes, so the problem wouldn't be with Apple, nor with McCartney, but somewhere else.

[megfilmworks]

Originally Posted by gnasher729

Looks like everything by Paul McCartney is on iTunes, so the problem wouldn't be with Apple, nor with McCartney, but somewhere else.

From what I have heard it has to do with the estates of John and George as well as the amount of the advance from Apple.

[Trip.Tucker]

Originally Posted by fishmoose

Well said! If it wasent for iTunes piracy would be an ever bigger problem then it is already imho!

Now we just need Apple Lossless in iTunes store and were good to go!

P.S what ever happend to The Beatles in iTunes store, have Apple given up on that one? I would love to have it there! I already have all the CD's and some LP's but anyway..

Apple have never been actively seeking to add the Beatles to iTunes.

[mutantteenager]

I trust Apple as much as a record label. They are really only interested in making money. There is no 'love of music' going on. I continue to buy music on CD, and see that as the only useful format.

All the itunes people are getting is a sonically second rate version of something an artist has worked hard to make sound as good as it can. You then have to buy something like an ipod to get the damn thing to work. Strangely Apple make those, and also make money out of those too.

The poor artist gets screwed in the process too. Apple were bitching about not paying greater royalties to artist not long ago.

Truly open formats would not tie you to a device. Apple have profitted from DRM by a different name, but only allowing purchased itunes content to work on an ipod.

Personally, I hope the itunes store sinks quicker than it took to gain it's monopoly.

[Tones2]

Remember that the record companies "compromise" to Apple is what they had ALREADY given all of the rest of the online distributors - DRM free music. They were holding this BACK from Apple / iTunes alone before this current agreement, which was unfair.

Tony

[idea_hamster]

When they say that Apple has never removed a label due to a disagreement, this may be true -- technically -- but recall that everyone saw what happened to NBC when they turned their collective nose up at iTunes.

NBC went off with the idea that they could build their own system, struggled to deliver an on-line media option, wallowed in red ink and obscurity, and eventually came back with their collective tail between their collective legs.

I know personally that I had, in fact, bought an episode of Monk through iTunes -- but when I found that the NBC-owned operation was Windows-only, I just forgot about it.

When NBC can't do it and returns as the prodigal son, other fat cats think twice about biting the hand that feeds them.

[talkingfuture]

The fact that Apple has put fear into the record companies amuses me greatly.

[Doju]

Originally Posted by talkingfuture

The fact that Apple has put fear into the record companies amuses me greatly.

Heh, it's definitely understandable, but hear hear.

[spacecadet610]

it's amazing how apple in < 10 years went from a nobody to the king of the U.S. music industry that everyone fears.

[raggedjimmi]

Originally Posted by spacecadet610

it's amazing how apple in < 10 years went from a nobody to the king of the U.S. music industry that everyone fears.

Heh thats what I was thinking. Back when I was getting into Macs iTunes was in its infant stages. I remember telling a friend back in school (in 2001) that MP3 is going to take over everything in a few years, but if someone told me Apple would be running the show then I'd never have believed it.

[PCFan]

Originally Posted by spacecadet610

it's amazing how apple in < 10 years went from a nobody to the king of the U.S. music industry that everyone fears.

You know what's even more amazing? In 33 years, Macs control only 7.4% of the market...that no one fears.

[skellener]

"Whether the industry likes it or not, the iTunes chart showing the most popular songs in America is a major influencer of how kids today discover and communicate with their friends what kind of music they like," said Charlie Walk, the former president of Epic Records, a unit of Sony Music.

Charlie Walk obviously doesn't know anything. He thinks kids buy music!

[PruneTracy]

Poor ol' giant record companies. I love how they are acting like the innocent victims in all of this. Record companies are the villains in all of this!

[daveporter]

Originally Posted by PruneTracy

Poor ol' giant record companies. I love how they are acting like the innocent victims in all of this. Record companies are the villains in all of this!

Until the download model for distributing recorded music came about, the music industry was able to use musicians as they saw fit (I was one of them in the 60s). Even if you found a way to record your own music (through Indi recording studios) you had no way to distribute it so you had no choice but to kneel and bow to the big industry boys and just allow them to screw you and hope that you got some of the scraps.

It is the loss of this power that most troubles the traditional music industry big shots...their days of making tremendous money off the backs of the musicians is ending and they are fighting any way they can to prevent this from happening. iTunes and similar services are giving the musician power that he/she never had before.

In the end, everyone wins (musicians, small studios, fans, Apple, Amazon, etc.) except the big music industry fat-cats!

[color guy]

hey,
We can't control the pipelines through payola, anymore!
Someone is going to figure out that we actually pretty useless and that
there is no actual need for a " record company" anymore.
That's so 20th century.

[gwangung]

Originally Posted by talkingfuture

The fact that Apple has put fear into the record companies amuses me greatly.

Let's hear it...

"AWWWWWWWW........."

[BRLawyer]

Originally Posted by talkingfuture

The fact that Apple has put fear into the record companies amuses me greatly.

This just shows how strong and innovative Apple is, and how obtuse music labels' business models are...Apple IS a game changer in the industry and a leader for taking on such innovations.

Before the iTMS, pretty much nobody believed in legal downloads, or even online music stores for that matter;

Before the iPhone, NO ONE thought of mass-production of multitouch smartphones or advanced apps in those devices...

SJ, go get a good rest and come back before Apple's competitors disappear in no time...they can't live without copying you...APPLE, THE BIGGEST AND MOST INFLUENTIAL CONSUMER IT COMPANY IN THE WORLD! GO APPLE!

[IronCross]

Originally Posted by talkingfuture

The fact that Apple has put fear into the record companies amuses me greatly.

Good.
The record labels deserve to have someone stab them in the skull and stomp on their neck.

Go Apple!

[Jayomat]

to have a monopoly is always bad, no matter who owns it...

[megfilmworks]

RIM, Microsoft, Nokia, Moto, Palm, etc., and now the record labels.

Anyone crossing paths with Apple will soon learn that
Apple is the leader in innovation and forward looking models,
as well as design and the hard to capture "kewl" factor.
Submit or die!

Way to go Apple!!

[pubwvj]

Originally Posted by megfilmworks

Submit or die!

I know, isn't it great to be a Borg?!? But hey, evolution worked.