Technology, Innovation & Telecomm

I’ve been watching the fight between Apple the and “music industry” for a while now. Apple claims that the .99 price-point is ideal and the industry folk want more flexibility. What “more flexibility” means is subject to much speculation. It appears that it means that they want to raise the prices for most of the individual songs and so I must admit that I’m astounded.

To me, .99 is at the very top end of what I think is reasonable for a song. I download from iTunes here and there and I think that overall, it’s an ok price to pay. Truthfully, I think the price should be closer to .75 - .80 but I’m guessing that ain’t happening any time soon.

The record industry continues to whine about piracy and the price of albums and the lackluster sales they’ve been experiencing. How about this:

1. The industry has been sued at least twice in the last 20 years or so for price-fixing. They’ve lost at least one of those cases. Have you seen the price of CD’s? I don’t see the costs to the consumer going down… What other industry has been able to hold the price of something as commodotized as CD’s so artifically high for so long?

2. Millions and millions of songs have been sold through iTunes. That’s simple proof that folks in general are NOT thieves as the RIAA would have you believe. At a minimum, it shows that people have a point where they feel something is a fair price. Exceeding that causes behavior like cessation of purchases, added piracy (not good), sharing, etc.

3. What a deal for the record companies. Post a song or two or a whole album to the iTMS site and watch the money roll in. No distribution. No printing costs. No CD pressing cost. No promotional costs. Yet with all that, they feel the need to demand more.

4. Throughout the music-watching world, the general agreement is that the quality of what’s being produced is dropping steadily. Why should we pay $15-$18 for what often turns out to be one or two songs that we actually like? Funny too, the record companies are actually complaining about the ala-cart ability to sell individual songs! The gripe follows the “we can’t sell the whole album that way and so we lose money” path. Ridiculous. Unless I *really* like an artist, I don’t risk $15 on a handful of possible crap. They should be happy to sell any of a lot of that stuff… You want to sell a whole album? Make a whole album of quality material.

So, you can see that I lean toward the iTMS model. I think it works. I think it shows the value of consumer choice. I think it beats the snot out of the “subscription” model that disables your ability to listen if you stop paying your dues.

Side point: I have heard rumors here and there about iTunes taking the subscription approach. If they take that path exclusively, I will no longer be a subscriber. If I pay for it once, I want access to it always.

So, I’ll continue to watch and to keep my eye on the indie market. There’s a lot of high-quality stuff out of the mainstream that can be had in a reasonable fashion. Keep your eyes on self-produced and other independently-created materials.

Is iTunes perfect? Probably not, but it has certainly shown what can be done in an age where highly-granularized choice for a fair outlay is highly desirable.

-Does this stuff burn you?
-Do you think the iTunes model works?
-Does the record industry have a point about rasing the price of songs?
-Do you like the subscription model for music download?

Do tell!

1. 
   Jim Schimpf said...
   7:26 am - October 2nd, 2005

   Reply from a responsible music industry leader:

   http://that1blog.blogspot.com/2005/10/record-company-executivedevils-minion.html

2. 
   John said...
   11:54 am - October 5th, 2005

   Certainly this stuff burns me; I try to play by the rules and this is the thanks I get? Higher prices and more restricted content? The cost of production and bandwidth for delivery of digital files is negligible, there’s no costs of storage or shipping of stacks of a physical product — good lord, man, the money they get from iTunes is almost entirely unencumbered with any of the costs of actual physical production and delivery.

   This is why I’ve moved back to buying CDs, at least until CDs are regularly copy-protected. At which point I suppose I will start listening exclusively to small labels who *want* their music heard.

3. 
   Diana Wade said...
   7:51 pm - October 19th, 2005

   Burns me, too, about the high cost of CD’s. In the past, as the new technology aged, prices went down.. Not so with music CD’s. Now we’re looking at many priced at $21 and up. I don’t buy them when they’re that price. Often, as you said, there’s only 1 or 2 on the album I like. So, I’d rather “pirate” or “burn” a CD from a fellow “burnee” like me. Of course, we lived in a greed-dominated world, so itunes, etc, want to keep raising their prices. Let them do so–they’ll lose a lot of customers, hopefully.