Music Prices Going Up?

[MacRumors]

The New York Post claims that the five major record labels have been in negotiations with Apple over pricing as well as other issues surrounding Apple's onling music store (iTunes).

Under the new contracts, the most popular singles could rise to $1.25 according to the Post's sources.

During the iTunes conference call, Steve Jobs addressed the question of album pricing:

But in any event, most of the albums on iTunes are priced at $9.99 and below and, no, they're not creeping up. There's always a few that are a little higher than you can go in and pull out, but they're very, very competitive and we see in the future the prices of the albums coming down, not going up, because that's what it's going to take to sell more albums and it's in everybody's best interest to do so.

[page3]

And they call the consumers Pirates...?

[joemama]

This must be a joke....I guarantee you will see a decrease in downloads on iTMS and a HUGE jump on LimeWire activity.

This would be the WORST thing the music industry can do. As is, Apple only gets what, 20 cents on the dollar..and they do most of the work. Jobs needs to make a stand.

[agentmouthwash]

why does Apple have to sell them for more, yet Walmart gets away with selling songs at 88 cents each.

Well if it goes to $1.25, I'm not going to be using the service anymore.

[Lord Bodak]

Just goes to show how out of touch the industry is with its customers. They have FINALLY found a way to get a large number of people to quit using P2P and buy their music legally-- and so they decide to kill it by raising prices.

[joeconvert]

And the RIAA wonders why sales are off. No such thing as market price in the entertainment industry it seems.

[Coleco]

This is the same NY Post that said Avie Tevanian was on the verge of bolting. Last I checked he was still with Apple.

Still, you gotta hope the record labels aren't that dumb. Album prices are already going too high for online distribution on iTunes.

It will only hurt Apple if it's selling singles for $1.25 while Wal-Mart, Napster, Sony and others are under the magic $1 mark.

[Lord Bodak]

Because Wal-Mart, in typical fashion, probably made threats to the labels. "If you don't let us sell songs for 88 cents, we won't stock your label's CDs in our stores."

Originally Posted by agentmouthwash

why does Apple have to sell them for more, yet Walmart gets away with selling songs at 88 cents each.

Well if it goes to $1.25, I'm not going to be using the service anymore.

[Mr. Anderson]

you know its just a matter of time before it will happen - although I have to say its way too soon - the whole industry is just getting up and running and a price hike, no matter how small, will shoot it in it's foot....

D

[MattG]

So if the price of single songs goes up, will the price of albums go up? Songs going up to $1.25 doesn't bother me that much since most of the time, I buy whole albums. However, if the price of an album goes up, buying music on the iTMS will definitely be less advantageous. I won't pay $12 for downloading an album when I could buy it online or in some music stores for not much more.

[Lord Bodak]

Good point. There's a magic price point, where people are willing to give up features (liner notes, a physical CD) for price. The closer a download price gets to the physical CD's price, the fewer online sales they'll get.

Originally Posted by MattG

So if the price of single songs goes up, will the price of albums go up? Songs going up to $1.25 doesn't bother me that much since most of the time, I buy whole albums. However, if the price of an album goes up, buying music on the iTMS will definitely be less advantageous. I won't pay $12 for downloading an album when I could buy it online or in some music stores for not much more.

[arqsagi]

Apple has done a great effort for downloading legal music from the internet, rising the prices of singles and more on albums will made legally less atractive, and in fact their music is available just as albums, well It will be really hard to buy online, what will be the advantage if you can go to any store and buy it at less price or even worse to lables use peer to peer networks.

If in fact true just shows how la labels dont understand the consumers and really doesnt whant to look to the future of digital media.

I WONT BUY ANY SONG OVER 1 DOLLAR,
repeat
I WONT BUY ANY SONG OVER 1 DOLLAR

And to sony, you should support Apple in this, because in few months when your "music store" will have to go down Apple will still the only succesfull online music store, a real music store with apealing portable devices, because who uses sonys?

[Dippo]

Do the labels WANT iTunes to fail???

I still think 99 cents is kinda expensive for a DRMed download.
I certainly won't pay $1.25 or more!!!

[harmless]

They did not even open a store in Europe and are already killing it by charging too much.

Even 0.99 is a price that a lot of people are not willing to pay. Now it will be 25% more? No way.

I guess, I'll make a deal with the russians: www.allofmp3.com


Andreas

[ifjake]

yeah this would be a bad move by the record companies. it's only going to encourage more people to crack it. fight it Jobs, fight it!!

[Dippo]

Originally Posted by harmless

They did not even open a store in Europe and are already killing it by charging too much.

Even 0.99 is a price that a lot of people are not willing to pay. Now it will be 25% more? No way.

I guess, I'll make a deal with the russians: www.allofmp3.com


Andreas

The price of the 1 Megabyte of the traffic for the media-materials marked as VIP or Online Encoding is 0.01 USD.

All the materials in the MediaServices projects are available for distribution through Internet according to license # LS-3?-03-79 of the Russian Multimedia and Internet Society. Under the license terms, MediaServices pays license fees for all the materials subject to the Law of the Russian Federation "On Copyright and Related Rights". All the materials are available solely for personal use and must not be used for further distribution, resale or broadcasting.

Users are held liable for the use and distribution of the MediaServices site information materials according to local legislation.

Yea they are cheap, but somehow I just don't think they are legal...

[autrefois]

According to the transcript of the conference call

Steve Jobs: Great. Let me answer those two things. First one is the price for songs in the iTunes store is remaining 99 cents per song, and we think that's what customers want and that's what we're delivering. So the prices will remain 99 cents per song and any rumors to the contrary are simply not true.

Thus I don't put much credence in the Post's report. Why would Jobs say the rumors aren't true if it had already been decided to raise the prices and the news could come out any day?? He would have been much more vague in his answer. There's not too many ways his answer can be interpreted, so as far as he is concerned, the price isn't going to change for now.

Maybe his decision to say that was a way to stop the labels from pressuring Apple for a price hike, and this leak is the labels' retaliation? Who knows.

[rufwork]

Why are we introducing album pricing into the mix about $1.25 single tracks? These seem two different issues, and the Jobs quote if very much out of context.

For starters, Jobs was replying to someone asking why there were so many albums for more than $9.99. Jobs was saying that there really weren't, but that if that was the price that music labels felt like charging for premium content (paraphrase, iirc, etc), they could. The issue of partial albums, which are all over the freakin' place, didn't even come up. That was a gross oversight by the apparently mostly Jobs-adoring reporters.

With respect to the $1.25 -- apparently someone thinks the market will handle it. Do I really care if I have to pay and extra 26¢ to get Hey Ya! without buying the whole dual disc? Hrm. That's a tough one. And that means the price is getting closer to the max I would pay, which is exactly where the record companies are shooting. If sales drop by 15% on those tracks, the gross still increases.

My only concern is that Apple's shooting for more pie if they allow a price increase. Apple making money is good, I guess, but as people have pointed out, a higher price makes [even legal] alternatives look nicer in a market that's skirting too expensive already.

How long can the iPod really dominate the market so much that iTunes can charge an extra premium for its services? And what about people like me, who don't own an iPod, yet have purchased several albums? Looks like we'd be awfully easy to lose. I've already not purchased a number of albums b/c of the 99¢ per track (not $9.99 bundle) cost -- and even more b/c of the partial album label.

[pennymonger]

The 'Big 5' - Universal, Sony, BMG, EMI and Warner Music - cooking the goose before it gets a chance to lay its golden eggs.

[jeffbistrong]

Services like ITUNES and downloading music legally were created to diminish the use of P2P networks, rising the price? I think I would have to go back to Kazaa (on my PC), or LimeWire (on my mac), rather than pay 1 buck 25 for a song. Id take the risk of the RIAA F***ing me over, rather than pay a buck 25 for a song.

[martijnvandijk]

and remember that we're already paying more then 1 dollar, when including vat.
1.25 incl vat will almost be 1.50. crazy!

[ifjake]

maybe this would be a kind of way to encourage people to actually buy the CD. but that's dumb. this is a lossy compressed format of their songs. say, an apple lossless version would definitely justify the extra 26¢, but not for the stupid little pop songs that they'd jack the price on. i recently just bought my first couple of songs off of iTunes and i can tell you i wouldn't have if they were any more than a dollar. if they're trying to get people to buy CDs they should try to push SACDs. you wouldn't want to compress a SACD for your little player, and trading it around is kinda out of the question. but let the online music distribution be. don't mess with a good thing. someone important read this!

[SiliconAddict]

If so I'm done with iTMS then. **** them if they think I'm paying any more then .99 for a song. This is called gutting the consumer. See just what level they can take and raise it a notch.

**shrugs** I can get any non .99 cent music off of shareaza in a matter of minutes at 192kb/s+. Smart move RIAA. Real smart.
I'm more pissed that this is going to hurt Apple in the long run. Watch music downloads drop because of this.

[SiliconAddict]

Originally Posted by ifjake

maybe this would be a kind of way to encourage people to actually buy the CD. but that's dumb. this is a lossy compressed format of their songs. say, an apple lossless version

Not even that. The average person couldn't give a crap about lossy music. 128kb/s is good enough for the average listener. 192 would probably be better but 128 is good.

[jayscheuerle]

How often have you bought a CD just for one or two songs that you liked?

Why not make the "best" songs, or at least the best selling ones, more expensive? Make the Billboard top 100 $1.25 and drop whole Albums down to $8. If a song drops out of the top 100, it goes back down to $.99.

Seems fair to me.

Of course, on the flip side, maybe any song 10 years or older should go for 25¢ or so...

Why should all songs be the same price? They're not all the same quality.

This is just an avenue that needs to be explored... - j