Universal Confirms iTunes Contract Change

[Antares]

The record companies should exist only for distributing physical music mediums. Since Apple, with iTunes, and many other companies distribute the music electronically, the record companies should not be involved. What purpose do they serve? Production studios and record companies are different things. A production studio would record and engineer the music...then, it goes to the record company to manufacture, market and distribute the music. With electronic music, you can completely bypass the record company since you don't need to manufacture and physically distribute the music anymore. It can go directly to the electronic music shop. You can hire whatever marketing company you want to promote the music. What does Universal (and other record companies) actually do in distributing music on iTunes? The music is already made. They don't manufacture or distribute anything. They don't even need to convert the songs into an electronic format...the production studio can do it. Yet, the record company still gets money for it? Why? Why do they get money if they do nothing for the artist when the music is distributed online?

Yes, artists probably have a contract that binds them to the record companies for all forms of distribution (including electronic)...but it really doesn't have to be that way. Artists should control where (and by whom) distributes their music online....not the records companies. Let the record companies control physical distribution. But they should not be able to control electronic distribution since they serve no purpose and contribute nothing in that format.

My 3 cents, anyhoo....

 

[cliffjumper68]

The record companies should exist only for distributing physical music mediums. Since Apple, with iTunes, and many other companies distribute the music electronically, the record companies should not be involved. What purpose do they serve? Production studios and record companies are different things. A production studio would record and engineer the music...then, it goes to the record company to manufacture, market and distribute the music. With electronic music, you can completely bypass the record company since you don't need to manufacture and physically distribute the music anymore. It can go directly to the electronic music shop. You can hire whatever marketing company you want to promote the music. What does Universal (and other record companies) actually do in distributing music on iTunes? The music is already made. They don't manufacture or distribute anything. They don't even need to convert the songs into an electronic format...the production studio can do it. Yet, the record company still gets money for it? Why? Why do they get money if they do nothing for the artist when the music is distributed online?

Yes, artists probably have a contract that binds them to the record companies for all forms of distribution (including electronic)...but it really doesn't have to be that way. Artists should control where (and by whom) distributes their music online....not the records companies. Let the record companies control physical distribution. But they should not be able to control electronic distribution since they serve no purpose and contribute nothing in that format.

My 3 cents, anyhoo....

Completely agree, the RIAA/MPAA have a vested interest in preventing digital distribution since it is harder for them to add value to the process.

 

[cisco1138]

This is about preventing another monopoly, which is never good for business. If things stay the way they are Apple will end up with too much power. Regardless of who it is, a monopoly is a bad thing.

But as I understand, this is a not a very profitable monopoly. It's a keep prices down monopoly. It forces other online music stores to keep their prices down in order to compete.

I remember when they doubled the price of music when they introduced the CD format. The music industry claimed that it was that much more expensive to manufacture. When AOL's marketing blitz proved that CD manufacturing was very cheap, music prices never did come back down. Now the ITMS has brought prices back down to what they where in the days of vinyl.

 

[Uragon]

It's funny how Apple (a computer company) came up with a solution to help reduced online music piracy, that the music industry or an other retail chain could come up with. Now they are complaining that Apple has too much control. They are not taking control, the mass of people supporting them are putting them in control!

Your loss Universal - Good luck using other online music stores



www.netdealsetc.com

I agree with you 200%, you said it rigthly,

 

[JonboyDC]

Well, I'm all for it. I hope that Universal leads other studios to do the same. Why? Because they still let the market decide where they sell their music. Right now, there isn't much of a choice, especially on the OSX-platform.

Right now, the market has decided that the best place to sell digital music is iTMS, and I don't think any studio is going to walk away from that. (And the fact that other online music services [other than eMusic] are not available for the Mac is not remotely Apple's fault -- Apple has done nothing to prevent other companies from making their music services or their mp3 players work with OSX).

Right now, Apple has agreements with the big studios, but they are not exclusive agreements (except to the extent the partners agree to make a certain very small number of songs available exclusively on iTunes as part of promotional efforts). Under their existing agreements, all of the studios are free to sell their music on other services. The long-term nature of the contracts just means that the studios have agreed to sell the songs at one pre-set price, and frees Apple from having to negotiate with the studios over the price of any particular song or album. And the long-term contracts also probably prevent the studios from offering any albums exclusively to other online services, so Apple doesn't have to fear getting shut out of selling any particular album.

This news does not mean that Universal is pulling its songs off iTMS. It just gives Universal the option to do a few things in the near future:

1) Universal could tell Apple that a particular album won't be made available on iTMS but will be exclusive to another service. And then, most likely, the online sales of that album will suck and the artist will tell Universal not to make any more stupid decisions like that.

2) Universal could tell Apple that a particular song or album will only be available on iTMS if Apple agrees to charge more than $.99 a song. Most likely, Apple will tell them to take a hike, the sales will suck, and the artist will tell Universal not to make any more stupid decisions like that.

3) Universal could, probably with 30 days notice, pull all of their music off iTMS. But there is no chance in hell this will happen unless there is another service that has a real chance of quickly replacing the lost sales. And I don't see that happening any time soon.

 

[iMikeT]

I'm not too worried. At most, I listen to less than a handful of Universal's artists.

The rest I could care less for.

 

[liberty4all]

iPhone's iPod should be iTunes

On a related note, Apple should call the iPhone's music player iTunes -- calling it iPod makes no sense at all since it is now a Mac OS X OS, and they need to add iTunes' streaming "Radio" feature -- I want iPhone to stream music to the car on the move!!!

 

[KingofAwesome]

Does it take a "competent engineer and producer" to make music? Absolutely not. What they do is polish the final product.

Rap is a niche market. You can defend it all you want but it's designed to appeal to a very narrow segment of the population. Just like country or R&B or any other genre. Some people, myself included, simply have no interest in it.

Ugg, if you think that the engineers and producers merely polish the final product, then you've obviously never done any studio work, and you have no idea what you're talking about.

I never said you had to like rap, just that you shouldn't dismiss it. You also don't seem to understand what "niche" means, and it's nothing short of absurd to say that every style of music is designed to appeal to a very narrow segment of the population.

 

[rish]

Whilst you discuss production.....

Ok so who else is allied with Universal as I exercise my total boycott of all their products. Have these companies forgotten that it is the consumer that makes them the big bucks. I've never liked music companies, as far as I'm concerned they are the scourge of our planet.

Amazing bite the hand that feeds you. I'm not one for doing things illegally however, if Universal find their stuff being pirated I hope they have a pair of size 9's to shove right up their own a...!

This stance is merely a two finger gesture to Apple and no doubt an effort to reduce the iTunes market share. I guess it's just a short time before they experience the erected arm gesture from the pirates and anyone else who feels they are being pushed in a direction no one wants to go.

No more Universal music for me.

 

[3rdpath]

just wait...

uni's doug morris was only posturing for a bigger slice of the pie...and apple had no reason to give it to him. bad move doug-you're bullying didn't work like the whole zune deal.

here's where it gets fun....just wait for uni's artists to start suing the label for not marketing their music in a globally competitive manner. uni has some big acts and they're gonna be big unhappy acts when their music's pulled from itunes.

just wait-it's gonna happen.

 

[Earendil]

Ok so who else is allied with Universal as I exercise my total boycott of all their products. Have these companies forgotten that it is the consumer that makes them the big bucks. I've never liked music companies, as far as I'm concerned they are the scourge of our planet.

Amazing bite the hand that feeds you. I'm not one for doing things illegally however, if Universal find their stuff being pirated I hope they have a pair of size 9's to shove right up their own a...!

This stance is merely a two finger gesture to Apple and no doubt an effort to reduce the iTunes market share. I guess it's just a short time before they experience the erected arm gesture from the pirates and anyone else who feels they are being pushed in a direction no one wants to go.

No more Universal music for me.

As opposed as I am to the whole ordeal, and opposed to record labels in general, I'd wait for Universal to actually DO something bad before I boycott them. So far they have only threated, not pulled the trigger.
They bought a gun, they may never use it though.

 

[Earendil]

1) Universal could tell Apple that a particular album won't be made available on iTMS but will be exclusive to another service. And then, most likely, the online sales of that album will suck and the artist will tell Universal not to make any more stupid decisions like that.

2) Universal could tell Apple that a particular song or album will only be available on iTMS if Apple agrees to charge more than $.99 a song. Most likely, Apple will tell them to take a hike, the sales will suck, and the artist will tell Universal not to make any more stupid decisions like that.

3) Universal could, probably with 30 days notice, pull all of their music off iTMS. But there is no chance in hell this will happen unless there is another service that has a real chance of quickly replacing the lost sales. And I don't see that happening any time soon.

Thank you for clarifying this to the masses. However I think you give the artists too much weight. #1 and #2 I think are more possible than you think, because the artists only threat is to go to a different record label AFTER their contract is fulfilled. In most artists cases, they lose fame before they ever fulfill the required number of album releases. A select few artists have the staying power to threaten Universal.

 

[Diatribe]

Those artists have alot to lose. It will be interesting if they stay with universal or switch to another more progressive label like emi. One can only hope

Half of these artists are either dead or dying...

Anyway, has anyone even READ the news? You are all acting as if something happened.

 

[bacon]

When you buy a song on the ITMS with DRM, you are only able to play that song on apple products. That is a long term decision, an investment. That whole burning to CD path and re-ripping is garbage, you lose the cover art, song title, artist, etc doing that. The only real way to change your mind is to remove the DRM, illegally (I think).

The gasoline analogy is ridiculous. Gasoline is destroyed on use.

I couldn't pass this up without responding. I get so tired of hearing that the iTunes music store is a monopoly. It's true that if you purchase songs from the ITMS, you must play them on an iPod, but the iPod plays many file formats so there's nothing stopping you from buying your music in MP3 form, or *gasp* on CD and ripping it yourself.

<begin tortured analogy>

Think of it this way: You own a car (an iPod) which can use four different kinds of gas. You stop at a gas station (ITMS) that only sells gas for your particular car. Neither your car or the gas station represent a monopoly. A monopoly is when your car only uses one brand of gasoline that just happens to be made by the company that makes the car, they sell tons of cars and put one of their gas stations on every corner.

</end tortured analogy>

So you see, sir, it is YOU who do not know what you're talking about (in this case at least).

 

[MikeTheC]

Apple needs to get off their butts and create the management/contract/payment infrastructure to deal directly with artists. It needs to be as easy as signing the contracts, getting and account and uploading your material. Say $.24 per download direct to the artist.

It is time to cut the big middle men out of the picture.

I think you'll find that 'Apple' already does this.

And here is a case-in-point example: Mark J. Cairns' AirwolfThemes.com

 

[MacBram]

When you buy a song on the ITMS with DRM, you are only able to play that song on apple products. That is a long term decision, an investment. That whole burning to CD path and re-ripping is garbage, you lose the cover art, song title, artist, etc doing that. The only real way to change your mind is to remove the DRM, illegally (I think).

I think you are complaining that you get more from iTunes than a simple music file. I might be wrong, but all the information that you can store in iTunes for a given track is a little more than the file's simple metadata. iTunes is a database, and iPods have the software to sync with it. That's it. If you burn a simple mp3 or audio CD I don't know why you would expect to have all databased info that you can possibly add to iTunes, as well as an attached piece of high-quality art that is more than just the audio file's icon. I do agree that you often get just playlist numbers in place of song titles.

MS doesn't handle the metadata of files especially well at the best of times. For ever Apple has been using a dual fork for added file info, and until recently you had to tell Windows how to open a given file because it didn't know what to do with it unless you gave the file a recognized .suffix

So why would Apple give up the farm and all its efforts to produce great software and functionality that differentiates it so that MS can give the Zune (or some other player with a screen) a functional database that displays cover art and everything else you want to read about a track? Just put the Zune on shuffle and hide that brown baby in your pocket.

For me, the long-term investment is my desktop/laptop computing environment. If I want to later stick music on a player or in a car stereo, then I just accept it isn't going to be the same experience as FrontRow or whatever. There are other ways to store your music than iTunes - good luck enjoying the importing, organisation, tracking, playing and syncing of your music. For optimum enjoyment you obviously need a player that can handle it. Too bad only one company makes one, I guess we are "locked" in. If it is so easy to have this user experience across the board in software and music players why aren't all manufacturers doing it.

 

[rob@robburns.co]

Currently 15% (give or take a couple % depending on where you look) of their music sales are through Apple. If the trend keeps up a larger and larger share of their revenue will have to funnel through Apple. Digital music sales are not as lucrative as CD sales. Piracy is and will continue to eat into their pockets. As a result their revenue will fall.

You have this backwards. The digital sales are both more profitable and less susceptible to piracy. CDs have no DRM. If the music industry leveled the playing field — by adding DRM to CDs or removing it from online sales — CD sales would evaporate even faster.

 

[PCMacUser]

If Apple needed to charge more per song for Universal songs, then that would be okay for me. As long as they keep the cost per album price the same (like they did with iTunes Plus)... NZ$17.90 per album on iTunes is very very good - because to buy a new release CD costs about NZ$29.95.

 

[bacon]

I was simply shooting down the original poster's analogy relating purchasing music online to buying gasoline. Additionally, I commented about Jobs claiming that you can remove DRM on iTunes files by burning them to a CD and re-ripping them, which is a joke.

Besides the physical labor of doing that, you then have to reconstruct the metadata for your music: title, artist, album etc. *every* competitor to iTunes supports this metadata and provides it when you purchase music online.

Apple doesn't offer more metadata than any other service (with the possible exception of cover art) or require filesystem forking to store it. How do I know this? Take a song you bought off of iTunes, modify the metadata, move it to another computer (a Windows machine) and your modifications will be there. Delete your database, iTunes will rebuild it. There are scripts on the net that will take your iTunes files and convert them into mp3 files with all the metadata in the ID3 tag for you (not legally).

The database is for speed.

DRM is for lock in.

Apple is not alone here either, the competition uses DRM as well and has their own compatibility/migration issues.

Where Apple stands alone (correct me if I'm wrong here) is in not licensing their DRM.

I think you are complaining that you get more from iTunes than a simple music file. I might be wrong, but all the information that you can store in iTunes for a given track is a little more than the file's simple metadata. iTunes is a database, and iPods have the software to sync with it. That's it. If you burn a simple mp3 or audio CD I don't know why you would expect to have all databased info that you can possibly add to iTunes, as well as an attached piece of high-quality art that is more than just the audio file's icon. I do agree that you often get just playlist numbers in place of song titles.

MS doesn't handle the metadata of files especially well at the best of times. For ever Apple has been using a dual fork for added file info, and until recently you had to tell Windows how to open a given file because it didn't know what to do with it unless you gave the file a recognized .suffix

So why would Apple give up the farm and all its efforts to produce great software and functionality that differentiates it so that MS can give the Zune (or some other player with a screen) a functional database that displays cover art and everything else you want to read about a track? Just put the Zune on shuffle and hide that brown baby in your pocket.

For me, the long-term investment is my desktop/laptop computing environment. If I want to later stick music on a player or in a car stereo, then I just accept it isn't going to be the same experience as FrontRow or whatever. There are other ways to store your music than iTunes - good luck enjoying the importing, organisation, tracking, playing and syncing of your music. For optimum enjoyment you obviously need a player that can handle it. Too bad only one company makes one, I guess we are "locked" in. If it is so easy to have this user experience across the board in software and music players why aren't all manufacturers doing it.

 

[GSMiller]

From what I can make of it they won't STOP selling their content through iTunes, they'll just sell what they want for as long as they want. Regardless it just goes to show just how out of touch they really are.