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Universal Music Group's iTunes Contract
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My experience of a certain music publisher
Personally Universal have never known what they were doing period. Remember the great Sierra game publishers which they bought and then brought to its knee's, even though they had at the time some of the best loved and well recognised games (Half Life 2 anyone). Put simply because they like entering foreign markets and lack the understanding to effectively contribute something new. They have a pioneering spirit with the business acumen of a spoilt child.
Ipod's i feel were just the first evolution, in some ways the Iphone needs to be a success because it will safeguard the move from the Ipod as a single function device.
Universal should feel free to go and work with Microsoft im sure they'll both be happy together. I know why not produce a Universal branded Zune with some exclusive content......for you to squirt at people...
Personally Universal have never known what they were doing period. Remember the great Sierra game publishers which they bought and then brought to its knee's, even though they had at the time some of the best loved and well recognised games (Half Life 2 anyone). Put simply because they like entering foreign markets and lack the understanding to effectively contribute something new. They have a pioneering spirit with the business acumen of a spoilt child.
Ipod's i feel were just the first evolution, in some ways the Iphone needs to be a success because it will safeguard the move from the Ipod as a single function device.
Universal should feel free to go and work with Microsoft im sure they'll both be happy together. I know why not produce a Universal branded Zune with some exclusive content......for you to squirt at people...
I did. Hunting for the stuff I like on P2P takes too much time. It's easier for me to give Apple a buck a song.
Having said that, if music labels attempt to screw us out of decent paid downloads, everyone should go back to P2P and put them out of business.
Right thread - it was in response to the dude who said Apple is getting greedy by wanting a share of the revenues from AT&T. I should have quoted him and my post would have made more sense.
UMG earned 200 000 000$, while Apple is not earning anything with the iTMS. In case of conflicting interests, who would end up losing?
The record labels are so consolidated that the absence of any one major would knock a pretty big hole in the iTunes Store. Still, I'd like to see Apple lock Universal out when the current contract expires.
The artists would revolt, the consumer backlash would fall largely on Universal, and Steve Jobs would hold up his hands and say 'We just want to keep consumer costs down and maintain a level playing field for the artists.'
Guess who's gonna win that one?
Its a free market...
However, I find it strange that music industry dislike Apple's dominance, but find microsoft dominance ok for all IT related industries.
Also strange, that you would attempt to close the door on one of your largest outlets...
However, I find it strange that music industry dislike Apple's dominance, but find microsoft dominance ok for all IT related industries.
Also strange, that you would attempt to close the door on one of your largest outlets...
with apple poised as 3rd largest retailer
... UMG might want to rethink this strategy..
Steve doesn't lose. That coupled with music labels' credibility decreasing exponentially makes for a bad business move.
... UMG might want to rethink this strategy..
Steve doesn't lose. That coupled with music labels' credibility decreasing exponentially makes for a bad business move.
From all the paperwork (PDFs) I've read...
Universal owns part of Vivendi and Vivendi owns part of Universal. They currently let Vivendi completely run the music part of the business with a close eye on them.
Remember, Vivendi owns Blizzard owns WarCraft!
Vivendi Universal Games doesn't own Blizzard; they simply are the publisher for Warcraft, etc.
To be fair, to each his own.
you're right...a lot of those freedoms can help a lot of unknown acts. I just feel 99% of them don't need to be heard anyway. This coming from a person who produces independant bands for a living.The music companies?. Why would artist be interested in keeping cost down?. How do you think the music companies will spin this to the artist?. Hmm, lets think this question through for a sec shall we?. The music companies want more money so they can pay artist more.. apple wants to pay the music companies less thus indirectly paying the artist less (artist gets a percentage so obviously, the higher the number the more the percentage is worth).. i dunno which artist wants less money. I'm sure we can find one somewhere.
Everyone?... even granny or that 10 year old who mom gaved him an itunes account.. everyone eh?.
Good for you though on switching to legal music.. you must be like betamax.. extinct.
Sure, but it's not that simple. It's a matter of who stands to gain/lose more.
Universal always has the right to pull their catalog. But who will be the big loser here? Apple or Universal? Will people stop buying iPods if Universal songs aren't in the iTunes Store?
Given the well-established fact that most songs on iPods don't come from the iTunes Store, I think it is pretty clear that Apple's iPod sales will not be impacted at all. But Universal will lose millions in sales - which they will not make back from other sources (like CDs or WMA-based download services.)
It's about control, not money.
Several years ago, when Hillary Rosen was still in charge of the RIAA, she accidentally let it slip in a press conference that the RIAA is all about labels retaining total control of the music, and doesn't care about money. They will voluntarily lose millions of dollars if it means nobody else has control over their product.
But stock-holders don't share this opinion. If they start losing too much, they may find their entire board of directors voted out of office. So they have to play the high-stakes game of threatening to cut off sales, and then doing nothing when (hopefully) the press isn't paying attention.
If that was all they were saying, then there wouldn't be a news story.
They have always had the right to sell through other stores. Do you think Apple is preventing Universal from selling through Napster, or any of the other WMA-based download services? Universal already sells through all these venues.
The fact that no customers are interested in buying from these services, with their confusing DRM terms (where every song may have different rights attached) and confusing pricing schemes (where you often don't even know what the price is until after you commit to a purchase) and subscription models (where failure to keep on paying causes your entire music collection to self-destruct.)
Universal is upset that Apple is providing what customers want, and that they aren't able to change that. They want to dictate all terms, and they think customers will simply fall in line and pay up. The fact that all other legal download services (where the labels do dictate terms) have failed in the marketplace doesn't matter. The fact that they were failing before iTunes came along doesn't matter either.
Right? Since when did rights have anything to do with this.
Apple, like all other music stores, has the right to charge their customers whatever they want to charge. Universal, as the supplier, has the right to refuse to make product available. None of this is in dispute.
If Universal really thinks they can be more profitable selling through other venues, they're welcome to try. Nobody is going to stop them. But most people think they'll lose a fortune and gain nothing in return.
That would be equally silly. Why lock them out? Even if they choose to accept the current licensing/pricing model, you'd refuse to let them re-up their contract? That makes no sense whatsoever.
If Apple tried to impose a lockout, public opinion would be against Apple, not Universal, and they'd be right.
Vindictiveness is never good business policy.
What if other labels follow?.. will you not be buying their songs too?. You think universal is the only label thinking this way?. how naive!
Are they also "concerned" they get a much higher percentage of the take on Apple's iTunes music store, than from any other reseller on a per song delivered basis?
Rocketman
Rocketman
Wow, the record labels do really make it incredibly easy to hate them, don't they?
Talk about playing with fire - I certainly hope Steve can kick them into line without muddling up iTunes pricing.
Talk about playing with fire - I certainly hope Steve can kick them into line without muddling up iTunes pricing.
That's how they labels will spin it, and I'm sure they'll use some creative accounting practices to make sure the artists never get paid, but it would all be based on lies.
The record labels make more money per-song from iTunes downloads than they do from CD sales. Much more. When you strip our manufacturing costs, distribution costs, and retail markup, a record label typically makes about $3 per CD - divided by 10 tracks and you get about 30 cents per song. Apple gives the labels 65 cents per song.
But the labels aren't satisfied with that. They want even more. After all, if they make 65 cents from a 99 cent song, then they could make $1.65 from a $2 song. And if Apple charged $3 (what cell carriers charge for ring-tones), they'd make $2.65 for that song. And if they charged $5 (retail price for a CD single), they'd make $4.65 for the song. The fact that most customers wouldn't pay $2 (or $3 or $5) for the song doesn't matter. They'd rather have 83% (or 88% or 93%) of nothing than 65% of something.
And although they'll claim it's all for the artists, that would also be a lie. The artists will end up getting paid the same pathetic 2-5 cents per song that they get now. And even that money will go to pay back the advance they were given during the recording process, so the artists will get absolutely nothing in exchange for the price hike.
Vivendi was/is a French water utility.
They bought Universal from Seagrams, the liquor company, which did a fairly spectacular job of trying to run the company into the ground thanks to Edgar Bronfman.
Vivendi somewhat recently sold most of Universal (film and television production) to General Electric, which owns NBC, among other things, and created NBC Universal. Vivendi kept the music group.
Also, Barry Diller and USA Networks has a bizarre and incestuous relationship with Universal. It's so complicated, I don't think Universal even gets it. But my take is that Universal was/is basically Barry's bitch.
Universal is not an independent company. It is a division of either Vivendi or General Electric.
On a side note, Edgar Bronfman, after selling Universal, tried to buy it back. He failed, but did manage to buy Warner Music. Which he is currently running into the ground. On the bright side, he has become very good at blaming "pirates" (arrrr) for it.
This is simply another case of the labels acting out and showing their discontent with Apple. As Apple grows as a music retailer they gain more power, especially in the digital market. Apple has so far kept the upper-hand in maintaining the price points they desire and controlling most aspects of how the music is maintained and marketed - the Apple brand is prominent in all of these interactions. It's a much different experience than buying a CD at Target, where the fact that you bought it from Target and play it on your Sony CD player is more or less irrelevant.
Apple has kept the iPod/iTunes/iTMS system closed, that's always been there business model with any market - sometimes it works in the favor, sometimes it works against them. In this case it has proven to be very successful. This closed system and the fixed pricing are probably the biggest points of contention from the labels. They've been fighting about it for years, they will continue to fight and who will win is unknown. Currently, I think Apple holds more power but that can change.
I still wonder if or when Apple will open up their system and how it will affect their business. In the PC/Mac war days their closed system really hurt them. I expected the rest of the market would be smart enough to come up with real competition to the iTunes system by now but they have been lame so far. Time will tell...
Apple isn't as wonderful and innocent as so many posters seem to believe though. Apple is shrewd in their business dealings. Don't get me wrong, Apple makes very innovative and quality products and is deserving of accolades. However, Apple didn't "save music" or do anything with altruistic intentions that you seem to bestow on them. This is a fight for power and money, that is all - it's business.
Apple has kept the iPod/iTunes/iTMS system closed, that's always been there business model with any market - sometimes it works in the favor, sometimes it works against them. In this case it has proven to be very successful. This closed system and the fixed pricing are probably the biggest points of contention from the labels. They've been fighting about it for years, they will continue to fight and who will win is unknown. Currently, I think Apple holds more power but that can change.
I still wonder if or when Apple will open up their system and how it will affect their business. In the PC/Mac war days their closed system really hurt them. I expected the rest of the market would be smart enough to come up with real competition to the iTunes system by now but they have been lame so far. Time will tell...
Apple isn't as wonderful and innocent as so many posters seem to believe though. Apple is shrewd in their business dealings. Don't get me wrong, Apple makes very innovative and quality products and is deserving of accolades. However, Apple didn't "save music" or do anything with altruistic intentions that you seem to bestow on them. This is a fight for power and money, that is all - it's business.
This is a grudge match
They desperately want to dislodge iTunes from their effective control of the music market. They want control of pricing and promotion. SpiralFrog, anybody remember that? A music store, apparently. Universal was a company that wants to keep Apple DRM'ed up, though maybe they could control a cross-platform DRM with Windows -- they just can't help trying to screw up the digital market like they did with physical music storage.
They should just get lost. They don't have any role in the music market today. They should go to a business they're good at: hmm, running child prostitution rings? Just trying to think what they're good at.
I hope that Apple announces a major sign-up of indies with the no-DRM, high quality business. Then they can't claim that Apple's a monopoly any longer, since if you buy aac unprotected music, you can load it on your Zune or your Samsung gigabeat if you want.
Oh, I remember, the head of UMG said "iPod owners are thieves." Yes, go and buy that Universal music! I always buy stuff from people who insult me.
Bitter little men in their Ferraris with their comb-backs and their 18-year-old model friends. Go jump in the lake.
Anybody buy music because a "label" sells it? Uh-uh. The tragedy is, Amy Whitehouse and Black-Eyed Peas are with them.
They desperately want to dislodge iTunes from their effective control of the music market. They want control of pricing and promotion. SpiralFrog, anybody remember that? A music store, apparently. Universal was a company that wants to keep Apple DRM'ed up, though maybe they could control a cross-platform DRM with Windows -- they just can't help trying to screw up the digital market like they did with physical music storage.
They should just get lost. They don't have any role in the music market today. They should go to a business they're good at: hmm, running child prostitution rings? Just trying to think what they're good at.
I hope that Apple announces a major sign-up of indies with the no-DRM, high quality business. Then they can't claim that Apple's a monopoly any longer, since if you buy aac unprotected music, you can load it on your Zune or your Samsung gigabeat if you want.
Oh, I remember, the head of UMG said "iPod owners are thieves." Yes, go and buy that Universal music! I always buy stuff from people who insult me.
Bitter little men in their Ferraris with their comb-backs and their 18-year-old model friends. Go jump in the lake.
Anybody buy music because a "label" sells it? Uh-uh. The tragedy is, Amy Whitehouse and Black-Eyed Peas are with them.
Only it isn't closed. Apple has said it wants to end DRM, which is what makes it closed. They've started with EMI. The indies are to come.
What does a music "label" do except hire acts, loan them money to make their recordings, then get them to work like slaves and never get out of debt? Why did Prince change his name to "formerly known as"? Because of record labels. They make contracts with artists when they don't have a dime, and the majority of them end up in debt. It once made sense, because recording equipment was expensive and scarce and distribution was a bitch. Now it isn't. Ergo, labels are like the Mafia. Drive 'em out of business and free the music.