“Last Wednesday brought two pieces of news in the ever evolving digital music wars. On the positive side, Apple CEO Steve Jobs was singing ‘The Anniversary Song’ in celebration of the first birthday of his iTunes store, by far the biggest emporium of legal song downloads. On the other coast, the Recording Industry Association of America, the lobbying arm of the major labels, crooned its old favorite, ‘You’re in the Jailhouse Now.’ It sued 477 more music lovers for copyright infringement, this time focusing on college students,” Steven Levy writes for Newsweek.
“Online prices should always be much lower than physical CDs. The economics of downloading favor high volume. CDs have to be pressed, warehoused and shipped, but in the online world, you transmit a file to the vendor and just collect money. When a super popular artist like Norah Jones emerges, forget about convincing a hundred thousand people to download it at $13-get a million people to make the mouse-buy for five bucks. It’s nice to sell 100,000 Norah Jones albums online at $13, but even better to sell 2 million at five bucks a pop,’ Levy writes.
“Isn’t it obvious by now that by accelerating the momentum of online stores like iTunes (and also promoting subscription services like Rhapsody, which can potentially deliver huge royalties to the industry) the industry will move quicker to a model from which it could launch hundreds of new ways to make money? (Jobs himself suggested one: sell out-of-catalog music now rotting in storage rooms for low prices,)” Levy writes. “Isn’t this a better way to move towards the future than suing college students? How many times does the same chorus have to play before music execs can hum along?”
Full article here.