Seconded.
Why should I pay (regularly even more for the album than for what I'd get it on say e-bay) just so that I can get compressed, DRM'd files.
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Apple Threatens to Close iTunes Store Over Possible Royalty Hikes
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Seconded.
Why should I pay (regularly even more for the album than for what I'd get it on say e-bay) just so that I can get compressed, DRM'd files.
The financial crisis affects everyone. That's how songwriters earn a living. I'm not saying they aren't already well off, heck I have no idea what's prompting this move - but I am saying that they have a right to look out for their own interests just like anyone else with a job.
People talking about artists and label greed really makes me ill.
Think about what goes into a record...
You've got to record it. Not counting the money that the artist has invested in equipment, education, etc. you have to pay to have it recorded. The people who do the recordings have hundreds of thousands of dollars invested in equipment, plus their own education. They have to make a living. A good budget studio will cost about $400 a day. Any extra musicians need to get paid, etc. Mixing, Mastering. On an indie label you're looking at a budget of 8-10K (AND THAT IS EXTREMELY LOW) Just to record. To make an intensive record, that budget can get up to 40K quickly.
You've got a record, you put it on iTunes.. and you want someone to listen to it... say you're you're own label, or a small indie. You need to hire a publicist ( minimum of 6K for a good campaign with postage, etc.) a small radio promoter (There goes another 6K)... You make your own music video and want it somewhere other than youtube.. Throw another 6K on that.
You can pretty much plan on being at 30 thousand dollars just to have a chance at success. NOT COUNTING songwriter royalties, assuming you've written all your songs. You need to sell 45K downloads to break even.
These issues aren't about Paul McCartney or whatever. Its about the hundreds of thousands of musicians, trying to do this for a living. Contributing art to society for your enjoyment. If any of us were greedy, we'd just be bankers instead. I know PLENTY of Famous musicians who are flat broke. Guys that played giant arenas last year playing $100 cover gigs tonight to pay their bills. There are a lot easier ways to make money. Music and Art are passions, and vital to society, but society has to support that.
Think about what goes into a record...
You've got to record it. Not counting the money that the artist has invested in equipment, education, etc. you have to pay to have it recorded. The people who do the recordings have hundreds of thousands of dollars invested in equipment, plus their own education. They have to make a living. A good budget studio will cost about $400 a day. Any extra musicians need to get paid, etc. Mixing, Mastering. On an indie label you're looking at a budget of 8-10K (AND THAT IS EXTREMELY LOW) Just to record. To make an intensive record, that budget can get up to 40K quickly.
You've got a record, you put it on iTunes.. and you want someone to listen to it... say you're you're own label, or a small indie. You need to hire a publicist ( minimum of 6K for a good campaign with postage, etc.) a small radio promoter (There goes another 6K)... You make your own music video and want it somewhere other than youtube.. Throw another 6K on that.
You can pretty much plan on being at 30 thousand dollars just to have a chance at success. NOT COUNTING songwriter royalties, assuming you've written all your songs. You need to sell 45K downloads to break even.
These issues aren't about Paul McCartney or whatever. Its about the hundreds of thousands of musicians, trying to do this for a living. Contributing art to society for your enjoyment. If any of us were greedy, we'd just be bankers instead. I know PLENTY of Famous musicians who are flat broke. Guys that played giant arenas last year playing $100 cover gigs tonight to pay their bills. There are a lot easier ways to make money. Music and Art are passions, and vital to society, but society has to support that.
the point i think they are trying to make is "fine you want to raise prices, then we will just close down the iTunes store. see where sales go then". apple is by far the largest online sales of music and if they closed...the higher price would fall very short of the lower sales by not having iTunes.
You're too cool for school
But seriously, it's cool that you're giving the middle finger to the Man.... you know those people that have kept prices low while everyone else wants to raise prices. And if you go all DRM on me, I'll just say "it ain't Apple's fault -- they don't want no stinkin' DRM"!
I'm sure they're really missing your 99¢.
But seriously, it's cool that you're giving the middle finger to the Man.... you know those people that have kept prices low while everyone else wants to raise prices. And if you go all DRM on me, I'll just say "it ain't Apple's fault -- they don't want no stinkin' DRM"!
It is true that songwriters, and not the recording side, are requesting the increase, but the mechanical royalty goes far past iTunes. This is a license you need as a cover band (even a small time one), as an Internet radio service, or as a download provider.
This is more than wanting more of the "download" pie--they're lobbying for higher royalties across the board because there's an overall downturn in sales, not because they're being squeezed out. The mechanical royalty, to be fair, is about 25 cents less than it should be, accounting for inflation, and they're only asking for 3-6, depending on format. However, the other side of that argument is that volume is far higher, and the breadth of royalty assessment covers far more than it did originally. Relatively speaking, songwriters are still making more money than they would have in 1910.
Effectively, this is jealousy of labels. Sales are down, so they want to raise royalties to sustain their income levels--except that doing so will only further depress sales, and thereby, their income. There's no winner here.
No. The royalty rates are not based on percentages (though the credit card processing fees are, in part). Nobody's slice gets bigger when the retail price goes up, except for Apple. The 9-cent "piece" becomes a 15-cent "piece" when six cents gets tacked on, not sixty-seven.
The six cents can either come out of the existing 70-cent royalty share (ha!), or the retail price can go up 6 cents to compensate without altering anything else. The problem is that a retail price increase results in fewer sales, which hurts Apple and not so much the copyright owners. A 5% drop in sales is break-even for the songwriters and some lost revenue for the labels, but it effectively drains Apple's profit, because that is the only directly percentage-dependent component. Music retail is incredibly low-margin. Just ask Tower.
The current rate, 9.1 cents, came into effect Jan. 1, 2006. The argument is that they want more money. That's it. Songwriters get far less money than the labels, but the labels are the ones with the "important" rights to license, so they can get more money because they're the roadblock to distribution. Songwriters, on the other hand, cannot stop distribution of recordings thanks to compulsory licensing and therefore have limited bargaining power.
A percentage makes more sense in certain circumstances, but the politics of the situation makes any setup problematic due to competing interests. It also makes accounting harder, because it must take into account actual receipts as opposed to simple multiplication.
You know you may be right. In the end, Apple is primarily a computer company. It's always been about Macs, the heart of the company.
Maybe the closing down of the iTunes Store is just the beginning... the start of a systematic contraction where Apple eventually SPINS OFF and sells off their iPod/iPhone business unit. Sell it off to another company such as Google or Dell or Microsoft or someone who is desperate to have decent mobile hardware. And then by selling or spinning it off, Apple will have billions more cash on hand... and they can then use that to re-invest in the Macintosh! Everyone is happy!
If it wasn't for iPod/iPhone, Apple would be struggling as they were before. If they lost/sold iPod/iPhone they would struggle again as only a computer company. Do you really think they've sold more Macs because people like their computers? I think they have sold more because of the iPod, plain and simple...they would be stupid to sell the iPod business, it will never happen. ( Then again I never thought the company I work for would be stupid enough to have to file for Bankruptcy - but they were and still are ).
Far be it for me to defend them, but...
Firstly, I believe that although the ruling is due this week, the filing was made back in July? Before the current financial crisis got quite as bad as it is now.
Secondly, if a songwriter's source of income is through writing songs and includes that 9¢ royalty then a sudden downturn in possible entertainment sales could be quite catastrophic for them.
Problem is, if the royalty is increased and that cost gets passed on to the consumer then this could trigger a downturn in entertainment sales.
Remember, this is for an increase in the cut that the actual writers get. It's not the labels directly asking for higher prices.
Problem is, this then becomes a lesser cut for either the distributors (in this case, Apple - who may not be making a huge amount per song) or for the labels. And the major ones probably don't want to decrease their profit margin even if they could handle it, and the indies probably can't absorb the costs as well as the bigger labels could.
But just because I don't agree with the possible outcome doesn't mean I can't see where the writers (and those working towards collecting the royalties for them) are coming from. Especially in the current economic situation.
i don't use it unless i have a freebie like the cards from starbucks or promos. i like music shops too much too stab them in the back by using itunes. i've never paid for a download besides a few apps.
i was told by a manager at a local record shop that he's already heard from music reps that as the downloading grows they already have plans to raise the prices. the target is to make them the same price as cd's are, and not the 9.99$ ones. more like 15.99.
so why download 128k for .99$ or more for 256k? you can get better quality on a cd, have something tangible, and support the record shop industry that likely got you into music in the first place, and if not you someone else that has influenced you musically?
i don't really think it would kill ipod/iphone sales. it would be a hit but do people really buy ipods so they can spend money on itunes? maybe i'm totally missing that?
i was told by a manager at a local record shop that he's already heard from music reps that as the downloading grows they already have plans to raise the prices. the target is to make them the same price as cd's are, and not the 9.99$ ones. more like 15.99.
so why download 128k for .99$ or more for 256k? you can get better quality on a cd, have something tangible, and support the record shop industry that likely got you into music in the first place, and if not you someone else that has influenced you musically?
i don't really think it would kill ipod/iphone sales. it would be a hit but do people really buy ipods so they can spend money on itunes? maybe i'm totally missing that?
Save for Metallica; they're a bunch of whiny wretches who can't ****ing catch a break. Did you hear the LATEST ****ing drivel they put out??? Anyone who rips one of THEIR CDs isn't a "fan". They rip it "because they can". I'm sorry. I was just about to support Metallica, until they put out this absolute drivel in a USA Today interview around the release of Death Magnetic.
I'm sorry Metallica, but go **** yourselves.
Authorizing music
I don't know if this has been mentioned, but if the iTMS is shut down. How will the "authorized" computers be un-authorized and once that happens, how will you authorize a computer to play a song(purchased from the store) if the store is closed?
I hope this makes sense, if not I will try to explain differently.
I don't know if this has been mentioned, but if the iTMS is shut down. How will the "authorized" computers be un-authorized and once that happens, how will you authorize a computer to play a song(purchased from the store) if the store is closed?
I hope this makes sense, if not I will try to explain differently.
Why? Because many people dislike the idea of having to carry 30 or 40 stupid plastic disks (CDs) and jewel cases in their cars just to choose and play all their favorite songs.... instead, it's 100 times better to just have all the favorite tunes stored in a single storage device called an iPod, and that device is the size of a candy bar. There are many many people in the 21st century that want to free themselves from the physical clutter of CDs. And for the most part, those people are OK with the audio quality of say 256kbps coming from most digital music players. The sound quality is good enough for them.
if you're an audiophile, then by all means keep buying your CDs. No one's stopping you.
I understand the Copyright Royalty Board. Everything is becoming more expensive in the USA, people want to increase their earnings too. Also, the value of the US$ is dropping every week and I am sure we are not far from seeing a huge and unprecedente collapse of the US$. If your selling prices never change, what are you going to do with a currency that nobody wants anymore?
This is one of the reasons I still buy CDs. Better quality, permanent medium for collecting and storage (unlike a hard drive that can be corrupted, wiped or simply fail mechanically), support of local business, support of independent artists, et cetera.
If they raise the price of digital music downloads, then there really won't be any monetary advantage over buying CDs at all. It will really be a choice of how you prefer to own your music collection - digitally or physically.
(Of course, it's already cheaper if you buy used CDs
What you fail to realize is that the artist and the record companies make the money back 10 fold from the high priced concert tours. Years ago I use to go to concerts and pay no more than $20.00 and that was see Michael Jackson. Now the average price of a concert ticket is sitting close to $100.00 for a new artist. Bigger stars are getting $250-500.
Artists in the mainstream music industry make a majority of their income from concerts and merchandise sales, mainly due to the contracts they have that essentially limit the amount of royalties they can receive from music sales unless an album sells in extremely high volume.
Of course, none of this applies to the independent music industry, where concert tickets are $5-15 and artists reap a significantly larger portion of sales and merchandising in profit because there's simply less overhead
I disagree with just one of your points. Apple makes a very small margin of profit off the store. The gross revenue they make off the standard song, as quoted many times already, is only 29c. Carve out apple's overhead to host and maintain the store, as well as the development costs to keep current on the site and software, and you probably pare that 29c down to below 10c per song, if even that much.
Yes, they are making a profit off the store but I'd wager only just barely so. If the record labels demand to pass this increase in royalties on directly to Apple then that would directly jeopardize the profitability of the music store and Apple would, as a profit driven company that answers to stockholders, be negligent at continuing to operate the store at a loss.
As many have stated already, Apple is a hardware company. Their big profits come from the iPod family and computers. The iTunes store is merely a low-profit venture to support the sales of the iPod. If they jack up the prices then many reliable buyers will look elsewhere for their fix and Apple could lose money. If they take the hit on the increase then they could begin losing money. If Apple loses money they would be negligent, at the very least, to leave the store open.
Yes, Apple works for a profit but they'll take a lower profit from a venture in order to help boost the profit of others. That's just good business.
bluff
They're bluffing. If only 9 cents of the actually purchase goes to the artist, then where does the other 90 cents go? There's no cost for a hard copy like in normal cd sales, so there's no cost for distribution. I'm calling their bluff. Apple is just greedy.
They're bluffing. If only 9 cents of the actually purchase goes to the artist, then where does the other 90 cents go? There's no cost for a hard copy like in normal cd sales, so there's no cost for distribution. I'm calling their bluff. Apple is just greedy.
What you fail to realize is that
1) Record companies, don't, or at least shouldn't have a piece of that.
2) Concert prices go up to cover increased costs of liability insurance, gasoline, etc. While the average NET to the artist is going down.
3) You're talking about the top of the pile. That is not the industry. For all but those 10 -12 artists on top, plus the legacy artists.. touring goes more like this.. If you're on the road with a big artist, odds are your record company either paid for your slot to help promote the album, or your entire band is making less than $500 a night. You hope and pray that enough of the people who weren't there to see you decide to buy a T Shirt so that you can eat that night, and drive to the next city in your busted up van. You've got crew and musicians that HAVE to be paid, and there is a very probably chance that by the end of the tour, you as the artist have actually lost money. If you're headlining a small club tour, its a bit better but not much. You're grossing maybe $5,000 a night, still have to pay musicians, crew, gas, hotels, keep the van or bus in good shape, Liability Insurance, equipment, etc. Your Agent is taking 15% of that, and your manager is probably taking another 20%.
If you can make a living (30-40K) doing your own music for a year, thats a major, major victory. Just try and gas up a 10 cylinder van and drive it 400 miles to the next show towing a trailer at $4 a gallon.
The blame for concert ticket prices lie clearly on Clear Channel / Live Nation and our government that allowed them to become a near unstoppable monopoly, and it also falls on the shoulders of sue happy lawyers who file constant nuisance lawsuits because someone went to a concert and got hurt in a mosh pit, or lost their hearing standing next to the speaker.
A major legacy act might make $30K a night, but they're supporting 30+ People on the road and still have to cover all those expenses.
As was mentioned earlier in the thread, about 70% of the sale goes to the record companies. And we aren't talking about the artists (who also get a very small piece of the pie), we're talking about the songwriters. Unless you're discussing indie music, in mainstream music the songwriter and the performer are often two different people.
Which is why you go on tour and/or license some songs to a TV show, movie, or commercial. It's not an easy job, and there just aren't very many multimillionaire artists when you get right down to it.
The ones that do exist, though, have a lot more exposure--because it's their popularity that made them celebrities. In that way, it's a self-reinforcing cycle for a small, privileged group, but not at all reflective of the whole.
The same can be said of anything. Obviously, lower prices and better products will always generate more business. It's not that easy.
Yes. This is exactly like any other boom and bust profession, though. Artists (including songwriters) turn to labels for exactly this reason, relying on advances and covered costs in exchange for a (large) share of the profit, when there is profit. Like it or not, the entertainment industry needs big, greedy labels to fund this all since society won't step up to the plate.
Between inflationary pressure and dwindling sales, artists and songwriters are stuck. Raising the royalty rate, however, is not the answer. Best case scenario, it doesn't make anything worse.
Not could. Does. The only question is whether the higher prices offset the lower sales. An act in which "no change" is the best outcome is the textbook example of stupid.
The record industry's strength: iTunes isn't the only game in town, therefore they are no longer dependent on Apple.
Apple's strength: Erm...
It's bluster. Apple are screwed without iTunes.
Apple's strength: Erm...
It's bluster. Apple are screwed without iTunes.
iTunes
Or..... Couldn't Apple just start it's own label? I bet they'd be willing to go 50/50 with the artists. Both sides would be getting a far better deal.
Or..... Couldn't Apple just start it's own label? I bet they'd be willing to go 50/50 with the artists. Both sides would be getting a far better deal.
this is bonkers
Online purchases have far better protection from IP theft than CDs and yet the publishers want to charge an extra levy. how dumb is that? Online sales are ultimatley better for the artist since they have the protection of DRM. What a bunch of ****s.
Online purchases have far better protection from IP theft than CDs and yet the publishers want to charge an extra levy. how dumb is that? Online sales are ultimatley better for the artist since they have the protection of DRM. What a bunch of ****s.
It's not just musicians who have to deal with this...everyone does. An engineer can choose to work for a company for a steady paycheck, or develop their own product and try to sell it.
There are jobs for musicians that are more stable than trying to release their own music CD. I know of many very talented musicians that have "normal" ( engineers, accountants, business owners, etc. ) jobs during the day and write/perform music in their free time. They have little interest in making any money from their music, they just love to write and perform it.
People who want to start small businesses have to work for years to save money to start their business or take out a loan, hoping that their business makes enough money to pay it back.
I'm not saying I don't like music, and I am definitely thankful for those who sacrifice and make the music I like. But, there are a lot of musicians that work as hard as any of the musicians on iTunes. But their music is recorded in their basements or garages and will never see the iTunes music store, will never be marketed or never even burnt to CD.