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Investigation into Online Music Price Fixing?
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From all indications, the focus of the investigation is on price fixing and collusion by the record companies, NOT Apple's monopolistic practices in the digital music market. Re-read Theoretical's post.bjdku said:I think this could be a disaster for Apple. It doesn't have anything to do with whether Apple makes much money or not. It has to do with domination and postioning to be a monopoly. It could be that in the contracts signed between Apple and the labels, there is a "most-favored-nation" status to allow the 99 cent price across the board. In the DOJ's mind, this could just be strong arming competition in order to lay the ground work for a monopoly.
Remember there are a lot of desperate people trying to take down Apple...there may be a few with some government access.
I hope I am wrong.
In all anti-trust matters, the litmus test is always whether or not consumers are harmed by anti-competitive practices. In certain limited cases, monopolies can actually benefit consumers, so monopolies in and of itself is not bad.
In the case of Apple, if they're trying to keep the downloads at $.99 and fend off the record companies from raising prices, they'd have no probs arguing that their practices benefit consumers.
price fixing? or fixed pricing?
record companies would be the lawsiut target in price fixing.
apple would be the target in fixed pricing.
old story of record companies having too much control over an industry they should never have had control of.
now riaa wants 30% of sirius satalite revenue. greedy bastards
riaa should be disbanded
record companies would be the lawsiut target in price fixing.
apple would be the target in fixed pricing.
old story of record companies having too much control over an industry they should never have had control of.
now riaa wants 30% of sirius satalite revenue. greedy bastards
riaa should be disbanded
OK, I do not remember where I got this... so take it with a grain of salt... but as I recalll...
Apple gets 20-24 cents of 99, the record companies get 75-80 or so (interestingly, the ARTIST gets somewhere around 2 cents!)
When you consider that the vast majority of music is already well payed for by previous CD sales, the record companies are the theives in this senario.
The profit to Record companies in CD's is even greater- artists get 50 cents to a buck, they cost 50 cents to a buck to make- you do the math!
I saw some posts about prices STARTING at 99 cents, and going up from there. I would rather see it TOP at 99, for maybe really popular or new releases, and go down to MC hammer at 5 cents.
I would/do not buy any iTunes music anyway- not a good deal at all, to my mind: low quality, copy-crippled- all those restrictions make it worth far less than 99 cents a song to me for any music.
My 2 cents!
dave
Apple gets 20-24 cents of 99, the record companies get 75-80 or so (interestingly, the ARTIST gets somewhere around 2 cents!)
When you consider that the vast majority of music is already well payed for by previous CD sales, the record companies are the theives in this senario.
The profit to Record companies in CD's is even greater- artists get 50 cents to a buck, they cost 50 cents to a buck to make- you do the math!
I saw some posts about prices STARTING at 99 cents, and going up from there. I would rather see it TOP at 99, for maybe really popular or new releases, and go down to MC hammer at 5 cents.
I would/do not buy any iTunes music anyway- not a good deal at all, to my mind: low quality, copy-crippled- all those restrictions make it worth far less than 99 cents a song to me for any music.
My 2 cents!
dave
Wow, some of you people need to take an economics course in the worst way. The price a vendor sets for an item is related to demand, not cost. It doesn't matter one bit what it costs to make a CD. The price is whatever price will net the greatest profit.
If they set the price too high, though they will get more per album sold, less people will buy it so the total profit goes down. If they set the price too low, they're throwing away some of the profit potential because lowering costs can only increase sales so much (I don't care if Britney Spears is $10 or $5, I'm not buying).
This isn't greed, its basic market economics at work. If something is more expensive than you're willing to pay, don't buy it. Simple.
And as for record companies making massive profits, do the homework yourself and you'll realize this is not the case. In terms of ROI, Apple is a much much more profitable company than any of the music publishers out there. Most of this is because for every successful act, there are ten acts that don't make back the money that record companies put into them. And for the ones that do make it, the record companies play a large role in making it happen.
I mean its a simple occam's razor thing. If the bands thought that they would be better off without the labels, they'd strike out on their own. Since hardly any of them do, you have to figure that either they're all criminally stupid, or that the labels actually do provide a service...
Who do you think pays upfront for studio time? The band? Hell no. Who pays the marketers who work to get the songs into radio station rotations and MTV?
Geez, you'd think the labels had eaten your babies the way some of you engage in such uninformed attacks. If there's anyone to blame for the state of music today its consumers who choose, time and again, Britney Spears and Co. over quality musicians.
If they set the price too high, though they will get more per album sold, less people will buy it so the total profit goes down. If they set the price too low, they're throwing away some of the profit potential because lowering costs can only increase sales so much (I don't care if Britney Spears is $10 or $5, I'm not buying).
This isn't greed, its basic market economics at work. If something is more expensive than you're willing to pay, don't buy it. Simple.
And as for record companies making massive profits, do the homework yourself and you'll realize this is not the case. In terms of ROI, Apple is a much much more profitable company than any of the music publishers out there. Most of this is because for every successful act, there are ten acts that don't make back the money that record companies put into them. And for the ones that do make it, the record companies play a large role in making it happen.
I mean its a simple occam's razor thing. If the bands thought that they would be better off without the labels, they'd strike out on their own. Since hardly any of them do, you have to figure that either they're all criminally stupid, or that the labels actually do provide a service...
Who do you think pays upfront for studio time? The band? Hell no. Who pays the marketers who work to get the songs into radio station rotations and MTV?
Geez, you'd think the labels had eaten your babies the way some of you engage in such uninformed attacks. If there's anyone to blame for the state of music today its consumers who choose, time and again, Britney Spears and Co. over quality musicians.
Why do I have a feeling some of you didn't read the article. MacWorld had an article about it as well. http://playlistmag.com/news/2006/03/03/fixing/index.php
I don't have a problem with tiered pricing, but who honestly thinks they won't want $1.99 or more for a "popular" song and 99 cents for the "less" popular one? We'll all agree that not all music is equal...there are stuff out there no one would want to listen to, let alone pay 99 cents to be able to listen to it. But I believe 99 cents is the sweet spot, where consumers are still willing to pay for their music. Otherwise, they'll just resort back to their pirating way.
What really ticks me off about all of this and the record companies wanting to raise the prices of these songs is the fact that they give Apple and the other music stores a copy of their song and that's it. They watch the money come in. No CDs to produce, no overhead, yet they're complaining they make no money in downloads?
You have a better shot of people paying 99 cents for an obscure song they heard on the tv/radio/movie than them shelling out $20 (if you're still shopping at the major music stores) for a CD. I don't understand how they're complaining about losing money (that's sorta like the oil industries crying out oil shortage, yet always somehow managing to record "record-setting profits" quarter after quarter). If you want people to buy your music, stop putting out manufactured crap and promote the real artists.
What really ticks me off about all of this and the record companies wanting to raise the prices of these songs is the fact that they give Apple and the other music stores a copy of their song and that's it. They watch the money come in. No CDs to produce, no overhead, yet they're complaining they make no money in downloads?
You have a better shot of people paying 99 cents for an obscure song they heard on the tv/radio/movie than them shelling out $20 (if you're still shopping at the major music stores) for a CD. I don't understand how they're complaining about losing money (that's sorta like the oil industries crying out oil shortage, yet always somehow managing to record "record-setting profits" quarter after quarter). If you want people to buy your music, stop putting out manufactured crap and promote the real artists.
wrylachlan said:
I think those two go hand-in-hand. People buy britney's crap purely because they hear it on the radio and MTV. And it's played there so much because the big labels pay lots of money so it gets played. That's something that really pisses me off. I hate it that people who own the radio conglomerates (this means you, ClearChannel) allow their airtime (outside of advertising) to be bought by music-production conglomerates to keep independent or unsigned artists off the air. I also hate how so many groups are selected/made (boy bands) purely for their marketability rather than talent and musicianship.
So I guess I disagree in where the blame lies for todays music (although some does indeed belong on most consumers)
Shop... someplace.... else...?Tupring said:
Unless I get a double disc, special edition, or import I rarely have a problem finding the CDs I want for less than $14 or $15. Actually, as a matter of point I refuse to pay over $16 for a regular CD 'cause I know I can get it cheaper someplace else.
wrylachlan,
Great post.
Counterfit,
Is it the music labels fault that people are largely sheep? If you own a business are you gonna put your marketing money behind the product that sells big or the product that doesn't? There are "independent" alternatives to just about everything in peoples lives. Do you get a computer from Dell, or from a local computer shop? Do you eat a Applebee's or the local dinner? Do you watch a movie at the big cineplex or the old, locally run theater? Do you hit up the mall or the local market? Do you shop at Borders Bookstore or the corner bookstore? Starbucks or the mom & pop hole-in-the-wall up the street? Britney Spears or Therapy?
I don't blame the majors for shoveling out pop-crap anymore than I blame the fast food industry for deep frying everything in sight. Does that mean we should get pissed at McDonald's for not offering up gourmet meals? No, it means if you want a gourmet meal go someplace else. Speaking of McDonald's... look at how the low-fat crazy has started to change the fast food industry. More places are offering lower fat alternatives and salads. Why? Because that's what consumers want. What happened to disco, hair metal, and grunge? Consumers tastes changed and the music industry changed as well.
Consumers can vote w/their wallets, but unfortunately many of them maker poor choices, IMO.
Lethal
this could be a problem and/or really funny
While this is an investigation of the Record Companies, consider the possible outcomes. They may decide that iTunes sales aren't worth it without price fixing. They pull out, iTunes doesn't have anything popular. They shut down in the US. Americans whine on MacRumors about not being able to buy music and everyone from every other country sees what it was like for us when iTMS was US only. I'd enjoy the irony.
While this is an investigation of the Record Companies, consider the possible outcomes. They may decide that iTunes sales aren't worth it without price fixing. They pull out, iTunes doesn't have anything popular. They shut down in the US. Americans whine on MacRumors about not being able to buy music and everyone from every other country sees what it was like for us when iTMS was US only. I'd enjoy the irony.
The labels won't walk away from iTunes because then we'd just illegally download more music than ever!
Seriously, because of iTunes ease of use, reliability, and selection I don't illegally download music anymore.
If you really want to support a band go see them in concert and buy their merch
Seriously, because of iTunes ease of use, reliability, and selection I don't illegally download music anymore.
If you really want to support a band go see them in concert and buy their merch
I have no problem with variable pricing, like the video store rental model as long as the MAXIMUM price is the current one, i.e. £0.79. With older albums/songs being cheaper.
Don't know that this is going to happen. As someone else said, the record companies' idea of variable pricing is the cheapest song being £0.79
There's no way I'm going to pay like £2.00 for the latest pop disaster.
Don't know that this is going to happen. As someone else said, the record companies' idea of variable pricing is the cheapest song being £0.79
There's no way I'm going to pay like £2.00 for the latest pop disaster.
Hope you'll be sitting with us in the front row!wrylachlan said:
For one thing, profit=revenue-cost, so if profit drives pricing then cost is certainly involved.
Mostly though, I think you're forgetting about the supply curve... The one that intersects the demand curve and thus indicates the equilibrium or "market" price. The higher the price, the more units producers are willing to put out there. This is for many reasons, but among them is the fact that as price goes up more producers are able to justify the cost of production. Demand brings more producers into the market to get a piece of the pie, but competition keeps prices close to the cost.
---
"We might as reasonably dispute whether it is the upper or the under blade of a pair of scissors that cuts a piece of paper, as whether value (price) is governed by utility (demand) or cost of production (supply)"-- Alfred Marshall, Principles of Economics, 8th ed.
---
Think about it-- people must buy enormous numbers of plastic bags, so why doesn't a bag cost an inordinate amount (as it should if price were set by demand)? Because competition comes in and new producers are able to undercut the old if margins are too high-- the price asymptotically approaches the cost of production as unit shipments go up.
If they set the price too low, they'll be selling below their cost to produce and be losing money on every unit sold which is not a sustainable position.wrylachlan said:
In a rigged market, such as one where price-fixing is involved, more profits can be gained from setting an unnaturally high price-- but this can only happen if competition is eliminated. Two things happen when the market is upset in this way-- consumers get fleeced because they aren't seeing competitive benefits and innovation stalls because there is no need outperform competitors. There are also significant knock-on effects in related industries-- if DRAM prices are fixed, then computer manufacturers are hurt because they are forced to sell at higher prices, and then all industry is hurt because the economy can't benefit from computer related productivity gains. In effect, the oligopoly is taking its profits from the pockets of other industries.
Price fixing is not basic market economics at work-- which is why it's illegal. Lobbying for government legislation regulating "fair use" is not basic market economics at work-- that's intervention for the sake of greed or protection of cultural investment depending on your view.wrylachlan said:
Media companies (music, movies, etc) are masters at moving money around through their various sub-organizations to hide or show profits as they choose (ask Peter Jackson). Since none of the labels only sell music, nor does Apple, it's hard to make the kind of comparison you're talking about.
I did quickly check Time Warner and Vivendi and both have higher profits than Apple. I'm not sure what "profitable in terms of ROI" means, but in terms of ROE (which I guess you can think of as shareholder investment, or ROSI
) Vivendi has better numbers than Apple, Time Warner is worse.If I try to take your point on ROI, however, one has to wonder... Return on Investment is a measure used to decide where to put scarce resources. If a record company can't make a decent return selling music then the management needs to be called to account. In this case, I think they need to be asked why they're so slow to adjust their business to new market realities... It's hard to imagine a better ROI than "encode once and have Apple pay your distribution costs".
Basic economics says that new technologies move the supply and demand curves and establish a new market price (typically moving the supply curve left and demand curve right setting a lower equilibrium)-- the record industry hasn't adapted.
The fact of the matter is, people are making that simple choice you prescribe-- they're not buying music. They're taking it. The pricing behavior of the record companies and the moves by Congress that seem to be based on an assumption that every consumer is a criminal have changed the tenor of P2P from theft and piracy towards acts of civil disobedience.
Truth is, there's an added cost (conscience) in file sharing. It's free monetarily, but people seem to be showing that they'd rather pay for something through iTMS than take it for free, almost as easily, and with less restrictions. Apple has something like 10% of the overall download market, which is impressive given the cost equation: $1+DRM vs guilt + a little fear - anger. That tells me that if the RIAA really wants to stop illegal downloads, they need to push the cost equation further in favor of legal downloads.
While there are a lot of bands I wouldn't be so quick to move out of the "criminally stupid" category, the main reason bands need to sign with a label is distribution. The labels have a lock on distribution, air time and shelf space-- a lock that's borderline anticompetitive.wrylachlan said:
Another market reality that the labels are going to need to come to grips with though is how easy it is becoming to self-produce your music. I suspect that one of the reasons they don't like this move to download services (and the likes of MP3.com) is that it gives artists a potential end-run around the labels: master your track in Logic and upload to iTMS. Apple isn't doing this now, presumably to keep the labels happy and because it would be a logistics nightmare, but the potential is there. I understand that myspace.com has built quite a reputation for grassroots marketing in this kind of thing.
There has been tension between artists and business long before music was first cut into wax and the first criminally stupid but very talented musicians saw their work making some schmuck in a suit very wealthy. Napster was just the kind of disruptive event that could lead to artists removing the blinders and taking the bits out of their mouths.
The labels are losing their choke point, and they're using lawyers and lobbyists to try and perpetuate the old model rather than be proactive in competing in a changing market.
I'd counter that if there's anyone to blame for the state of the music industry today, it's the labels who continually alienate their customers and seem incapable of marketing anything but best-of albums and rehashed beats by models chosen more for their looks than their talent.wrylachlan said:
The uninformed attacks that I see come on a daily basis from the industry. There is clearly demand for music, and I think their ineptitude accounts for more of their financial problems than piracy does.
amphi said:
no perhaps about it. if record companies got together and agreed on a uniform pricing system, that would be called price fixing, which is illegal, and which is what this case is about.
also, edgar bronfman is a tool. he's perhaps not as big of a tool as some of the other music industry execs, but he's still a pretty big tool. most of the execs are just trying to hold on to the old model of the music industry. bronfman is trying to hold on while simultaneously try to reach into new paths.
But the cost of putting out a hit CD (the ones whose high pricing everyone is complaining about) is much lower than the pricing, so it can effectively be ignored in the context of what we're discussing.Analog Kid said:Hope you'll be sitting with us in the front row!
For one thing, profit=revenue-cost, so if profit drives pricing then cost is certainly involved.
But that only works in a perfectly (or close to perfectly) competitive market. If Joe's Hammer company decides to crank up their prices to $50 per hammer, Mike's Hammer company will undercut them at $40 and steal volume. Joe will respond at $30, back and forth untill you reach a price marginally above cost. Why? Because hammers are essentially interchangeable.
Music is not. People aren't going to go out and buy more Santana because the Jessica Simpson album is too expensive. They're simply going to buy less Jessica Simpson. And production isn't something anyone can do. If I saw Jessica Simpson was overcharging, I couldn't just go out and pull someone off the street into a recording studio. It takes time.
See above - music is not that type of market
For the specific high priced CDs we're talking about they don't even come near to selling for a loss, so that isn't applicable to our context.
You're absolutely right in all of this. Fixed pricing is bad for consumers. However I was responding specifically to the idea that high prices are evidence of price fixing, which is not the case. There can and often will be high prices on items even without price fixing so you can't simply point at the pricing as proof of price fixing.
Time Warner is a massive conglomerate that includes all sorts of different media. If you want a better comparison look at Warner Music Group which certainly does NOT have better numbers than Apple - by a long shot.I did quickly check Time Warner and Vivendi and both have higher profits than Apple. I'm not sure what "profitable in terms of ROI" means, but in terms of ROE (which I guess you can think of as shareholder investment, or ROSI
But the resources are scarce. The resource is talent. The cost of finding and nurturing, acquiring from other labels, etc. new talent must be paid by the sales of music. This "new market realities" idea is bunk. The physical cost of printing and distributing the media has been going down ever since the drum phonograph. Do you honestly think that a significant percentage of a record company's budget goes to printing CDs???
LOL. If you think that civil disobedience is anything more than a psychological trick that music theives use on themselves to assuage guilt, you're nuts. They don't do it out of civil disobedience. They do it because its easy. iTunes hasn't succeeded because because its legal. It succeeded because its legal AND easy.
Lord Blackadder said:
This is extremely flawed logic. The cost of producing a product is just one factor in determining it's price but not the only one. It probably cost the same to mine gold as it is to produce rubber (if i am wrong, i am sure someone can point out where the cost of mining gold is the same as some other significantly cheaper material). In fact, more relevantly, the cost for intel to make their chips are the same (not taking into account development cost of course). Now, yes, the cost of stamping a cd is the same but more popular artist are promoted more heavily that non popular artist. They go on the road more, they have more expenses.. etc. I seriously doubt you can prove the cost of producing all music is the same.
This is an interesting discussion. Every person I know who has music on the iTunes store is taking home a bigger check from that source than all of the other sources combined. Now, I don't know if this translates across the board, as these artists aren't as well known as the major pop icons that have music on the iTunes store. My guess, though, would be that they sell more on iTunes, as well. I can say for myself that I have not bought a CD in about a year, yet, I have still managed to spend 4 or 500 dollars on new music...............from iTunes. That's actually probably more than I would spend on new CDs in a year. I think it would be cool to have tiered pricing, but, I don't think the price per song should be above .99. That is GOLDEN. If they raise that.....they will likely lose a lot of customers, IMO. I, for one, will not buy as wrecklessly as I do, if the prices are raised. Most musicians I know say they make about the same per album/song on iTunes that they do from CDs. I'll bet if they raised the price, the artist wouldn't really see any more than they do now, and the record companies would start rakin' it in. There are no packaging or other frivilous costs associated with having content on the iTunes store, therefore, the price should reflect that......and, right now, it does.
The music industry will lose this lawsuit.
Similar comparisons to other medias will be made. Compare this to the movie industry.
Lets say one day the movie industry says they feel newer movies are worth more than old movies when it comes to dvd sales. They now want to charge more for the third Matrix movie then the first one. We all know this would be a flawed logic seeing that the first Matrix movie is far superior to the third (most would agree but not all of course). Then to offset this the movie industry would need to determine how long a movie would need to be out before it becomes "old".
In my opinion even 20 years from now the first Matrix will still be superior.
Is the Beatles white album worth less then the last Menudo album? Its 20 years older so it must be so.
Seeing that there is no way to truly determine what music it more "valuable" this lawsuit is destined for failure.
Is a lithograph of a Picasso worth more or less then a litho of a Degas? They are both reproductions made of the same paper and ink so its up to decide which is more visually valuable.
Again, no scientific way to determine.
The music industry will need to set standards as to what "sound" is worth more than other "sounds".
This would make all music sound alike seeing that everyone would want to make music sound like the more expensive sound then the cheaper sound.
The music industry is wasting its money. Total BS!
If the music indusrty is going to say some music is worth more then other music, they would in a way be admitting they are selling a whole bunch of inferior products and some quality products. This may come back to haunt them.
This means that they will have to sell all the new "crappy" music that does not meet the designated standards (which is a majority) at a cheaper cost and perhaps lose more then they gain.
Lets also say a company that makes plates and paints designs on them creates two seperate designs. One is determined to be more "pretty" and popular then the other and everyone would be buying the "prettier" plates and no one buying the "less prettier" plates. Why even make the less prettier plates at all. It would be a lo$$ from the beginning.
This will hurt the music industry in the long run in my own opinion.
Similar comparisons to other medias will be made. Compare this to the movie industry.
Lets say one day the movie industry says they feel newer movies are worth more than old movies when it comes to dvd sales. They now want to charge more for the third Matrix movie then the first one. We all know this would be a flawed logic seeing that the first Matrix movie is far superior to the third (most would agree but not all of course). Then to offset this the movie industry would need to determine how long a movie would need to be out before it becomes "old".
In my opinion even 20 years from now the first Matrix will still be superior.
Is the Beatles white album worth less then the last Menudo album? Its 20 years older so it must be so.
Seeing that there is no way to truly determine what music it more "valuable" this lawsuit is destined for failure.
Is a lithograph of a Picasso worth more or less then a litho of a Degas? They are both reproductions made of the same paper and ink so its up to decide which is more visually valuable.
Again, no scientific way to determine.
The music industry will need to set standards as to what "sound" is worth more than other "sounds".
This would make all music sound alike seeing that everyone would want to make music sound like the more expensive sound then the cheaper sound.
The music industry is wasting its money. Total BS!
If the music indusrty is going to say some music is worth more then other music, they would in a way be admitting they are selling a whole bunch of inferior products and some quality products. This may come back to haunt them.
This means that they will have to sell all the new "crappy" music that does not meet the designated standards (which is a majority) at a cheaper cost and perhaps lose more then they gain.
Lets also say a company that makes plates and paints designs on them creates two seperate designs. One is determined to be more "pretty" and popular then the other and everyone would be buying the "prettier" plates and no one buying the "less prettier" plates. Why even make the less prettier plates at all. It would be a lo$$ from the beginning.
This will hurt the music industry in the long run in my own opinion.
Analog Kid said:Hope you'll be sitting with us in the front row!
In a rigged market, such as one where price-fixing is involved, more profits can be gained from setting an unnaturally high price-- but this can only happen if competition is eliminated. Two things happen when the market is upset in this way-- consumers get fleeced because they aren't seeing competitive benefits and innovation stalls because there is no need outperform competitors. There are also significant knock-on effects in related industries-- if DRAM prices are fixed, then computer manufacturers are hurt because they are forced to sell at higher prices, and then all industry is hurt because the economy can't benefit from computer related productivity gains. In effect, the oligopoly is taking its profits from the pockets of other industries.
Price fixing is not basic market economics at work-- which is why it's illegal. Lobbying for government legislation regulating "fair use" is not basic market economics at work-- that's intervention for the sake of greed or protection of cultural investment depending on your view.
The uninformed attacks that I see come on a daily basis from the industry. There is clearly demand for music, and I think their ineptitude accounts for more of their financial problems than piracy does.
Great post! I couldn't agree more. When an industry has to create restrictive DMCA copyright laws and sues it's customers for survival or healthy profit preservation then you know it is has grown too antiquated to survive. Just like buggy whips!
The US needs to re-evaluate the purpose and practice of Copyright and Patent laws. In both cases I think the consumers would benefit if the laws were either less restrictive or had shorter time durations for the restrictions.
I'm busy writing a paper on the Music Industry and the Internet. I will report in late June on my findings.
This price fixing is not to do with Apple, it is to do with the record labels and publishing (please remember these things are different). They are selling at x company cheaper than to y company, leaving one at a disadvantage. Also, royalties are not being reflected back to the publishers compared to a mechanical sale.
This price fixing is not to do with Apple, it is to do with the record labels and publishing (please remember these things are different). They are selling at x company cheaper than to y company, leaving one at a disadvantage. Also, royalties are not being reflected back to the publishers compared to a mechanical sale.
Very good discussion.
How will the record companies determine a good tiered pricing mechanism?
Popularity? (In their minds or what is actually being downloaded? I find it interesting to see what is actually in the top 100 on the store. Doesn't seem to relate to what I hear on the radio. hmmmm.)
Age? (How long it has been on the street? As Freeney said above, when does a song suddenly become old?)
Payola? (We know about that already...)
There is no way to establish a good tier. I think when they mean tier, they are saying we need to be making a whole lot more money or be on another tier above the artists and Apple. They will use all 3 methods I have mentioned as well as others to raise all pricing across the board.
The 99 cent price point is pretty good. (Of course, a little lower would be nice too). I bet at the end of the day when you do the averages, you pay higher for some and lower for others in this method but it works out.
For me, this price point is so easy that I get all of my music from the store now. Just too easy and the downloads are always pristine.
In any case, companies can certainly do what they want. They cannot however conspire to set pricing as a group or an industry.
I am guessing that if say at the iTunes Music Store, Sony songs used a tiered format, Time Warner used a set 99 cent pricing format, etc it would be a no brainer what would happen. TW would sell a lot of songs both old and new and Sony would sell a lot of their songs priced at 99 cents or lower and not too many priced above that.
Of course, this would expose the problem, thus they need to conspire. Apple is right to beat on them in public. For now, I am thinking Apple is actually helping to hold prices down. The industry saying we may see some pricing below 99 cents is just a smokescreen. Some is the keyword. In fact, it may just be interesting if after this investigation that it is found that music pricing is being fixed too high and should go down. Wishful maybe but could it happen? I am staying tuned.
How will the record companies determine a good tiered pricing mechanism?
Popularity? (In their minds or what is actually being downloaded? I find it interesting to see what is actually in the top 100 on the store. Doesn't seem to relate to what I hear on the radio. hmmmm.)
Age? (How long it has been on the street? As Freeney said above, when does a song suddenly become old?)
Payola? (We know about that already...)
There is no way to establish a good tier. I think when they mean tier, they are saying we need to be making a whole lot more money or be on another tier above the artists and Apple. They will use all 3 methods I have mentioned as well as others to raise all pricing across the board.
The 99 cent price point is pretty good. (Of course, a little lower would be nice too). I bet at the end of the day when you do the averages, you pay higher for some and lower for others in this method but it works out.
For me, this price point is so easy that I get all of my music from the store now. Just too easy and the downloads are always pristine.
In any case, companies can certainly do what they want. They cannot however conspire to set pricing as a group or an industry.
I am guessing that if say at the iTunes Music Store, Sony songs used a tiered format, Time Warner used a set 99 cent pricing format, etc it would be a no brainer what would happen. TW would sell a lot of songs both old and new and Sony would sell a lot of their songs priced at 99 cents or lower and not too many priced above that.
Of course, this would expose the problem, thus they need to conspire. Apple is right to beat on them in public. For now, I am thinking Apple is actually helping to hold prices down. The industry saying we may see some pricing below 99 cents is just a smokescreen. Some is the keyword. In fact, it may just be interesting if after this investigation that it is found that music pricing is being fixed too high and should go down. Wishful maybe but could it happen? I am staying tuned.