“The gloves are off in the battle between Apple CEO Steve Jobs and the music industry over the price of downloaded songs,” Red Herring reports. “On Thursday, one of the music industry’s highest-profile executives responded publicly to Mr. Jobs’ charges, made earlier in the week, that they were ‘greedy’ when they requested a price hike for downloaded songs.”
Red Herring reports, “At an investors’ conference in New York, Warner Music Group CEO Edgar Bronfman Jr. said the price of downloaded songs should vary depending on the popularity of the songs and the artists. He called Apple’s across-the-board $0.99-per-song charge unfair. ‘There’s no content that I know of that does not have variable pricing,’ said Mr. Bronfman at the Goldman Sachs Communacopia investor conference. ‘Not all songs are created equal—not all time periods are created equal. We want, and will insist upon having, variable pricing.'”
Red Herring reports, “Mr. Bronfman’s remarks came in response to Mr. Jobs’ statement on Tuesday blasting the music industry for pushing for an increase in the price of downloaded music, saying their demands, if met, would serve to encourage piracy, which has eaten into the industry’s profits. ‘We are selling our songs through iPod, but we don’t have a share of iPod’s revenue,’ he said. ‘We want to share in those revenue streams. We have to get out of the mindset that our content has promotional value only. We have to keep thinking how we are going to monetize our product for our shareholders,’ added Mr. Bronfman. ‘We are the arms supplier in the device wars between Samsung, Sony, Apple, and others.'”
Full article here.
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‘Not all songs are created equal—not all time periods are created equal. We want, and will insist upon having, variable pricing.’
Let the greed shine through those lightly veiled remarks. If they want variable pricing, then allow the 99 cents to be the maximum price and lower the prices of the older songs.
spoiled children
I hope their artist defect like they did in Japan
Go ahead, start your crazy pricing scheme’s and LimeWire will surely become as popular as iTunes. I’ll be willing too pay the 5-finger discount for your “monetized, share holder-friendly” music!
Are there any music fans that are music executives?
Is Jay-Z the only artist running a label?
Anybody who starts playing music to become a millionaire doesn’t deserve it even if the opportunity arises.
I agree. Start at 99c for current tunes and reduce the price 1c per year until the minimum of 50 c is reached.
Record Execs want to be able to have promotional pricing and price to market conditions. There’s nothing “evil” about that, but it drives against Apple’s heterogeneous approach to computing. $.99, each. That’s it. Simple. Apple’s approach is for the customer, not the marketer.
MW: level, as in iTunes:leveling the field for all artists.
“There’s no content that I know of that does not have variable pricing”
There’s no business I know of where all the competitors (the record lables) are protected from actually competing by selling all their products in a distribution channel at exactly the same $0.99 price. Most would call that price fixing.
“We are selling our songs through iPod, but we don’t have a share of iPod’s revenue.”
Redpath sells sugar to the confectionary industry, but doesn’t get a share of candy sales. WAAAAHHH!
“We are the arms supplier in the device wars between Samsung, Sony, Apple, and others.”
No, you’re just a tool.
I hope Apple allows more than just the iTMS to work with the iPod. It should allow ANY music store to work with the iPod. Then let the content carpet-baggers beat each other’s brains in with price wars.
‘We are the arms supplier in the device wars between Samsung, Sony, Apple, and others.
even samsung bowed to the power of apple and gave them a hugh discount on memory chips. samsung is smart, they recogize apple as both a partner and a competitor.
All songs are not equal. The good ones sell many copies the bad ones just sit on the server, unloved.
Let them raise the song prices but refuse to distribute the ones they want more than 99c for. Simple.
I say let ’em. Here’s what they do, if they want to charge $1.29 or $1.49 (or whatever) for “current songs”, then drop the price of oldies (but goodies) to .79¢ or .49¢. What difference should it make to Apple? I don’t think Steve should lose too much sleep over this. They can “flip-the-switch” and change the pricing structure overnight. People will complain for a day and then it’ll all be over, everybody’s happy and iTunes rules the world once again.
MW= wall, as in tear down the .99¢ wall Steve.
Say what you want about how “evil” these guys are for trying to make a buck on their product. But they’re simply insisting on a normal arrangement. Is there any other circumstance where the retailer even gets to say a WORD about the wholesale pricing of the product?
This is a losing battle for Apple, and Jobs knows it. His remarks are only serving to put the public on notice that he’s not the one responsible. If he refuses to sell a higher prices, the labels will simply pull their content. No content = no iTMS = decreased iPod share and a deflating of the image of Apple as being firmly in charge.
If he gives in, iTMS purchases will decline, and other players will gain more footing. iPod share will decrease, and the image deflates anyway.
Dangerous drugs. Does anyone know when the contracts expire?
“I hope Apple allows more than just the iTMS to work with the iPod. It should allow ANY music store to work with the iPod. Then let the content carpet-baggers beat each other’s brains in with price wars.”
Yes
bad news bear,
are you saying that if someone charges more than you want to pay, then it is okay to steal it?
They are transpiring greed. Why don’t anybody educate them that if one song is more “equal” than another than it will sell more and that is where the money is, in QUANTITY like every other product. Better products, like the iPod, sells more. Apple does not increase the price of the iPod just because it is more popular. Actually, they decrease the price and sells even more.
“We want, and will insist upon having, variable pricing.”
No, you’ll take what Apple gives you and like it.
There is a strong psychological benefit to the .99/song model as well. I sometimes sit around buying music and somewhere in the back of my mind I’m thinking, “It’s only a buck. No big deal.” If I start seing songs for $1.57 or other weird prices, it will cause me to think harder about what I’m spending.
As it is, it’s so easy to buy music that I ran up a $1000 tab in no time the first year iTunes was out. I’m probably somewhere near that for this year.
I believe, what the record companies really want to do is push us back into CDs.
In addition, that crap about not all songs being created equal is just that crap. It’s obvious to everyone that even at .99 they’re making a sizeable profit since there are no atoms involved, only bits and bits can be shipped for next to nothing.
PC Apologist – you’re wrong.
If you own a $300 ipod you will load it with music one way or another.
How many 6-60 gig ipods are full of itunes downloads – few, probably none.
Downloaders buy more than non-downloaders. Turn of the legit supply and ‘hello limewire’
My sister doesn’t own an iPod. She doesn’t want one. She buys music from iTMS anyhow…she burns CDs and listens to them in her Isuzu. Should Isuzu cut a check to Warner because it? Kiss off, Mr. Bronfman Jr….you have no clue what your consumers really want.
I will grant you one thing…all songs are not created equal..and lately, music has been pretty much LESS equal than songs made 20 years ago, IMO. I have purchased 3 times as much music in the last year, than I have in the last 5 years total. If you jack up the prices now, I will buy less, or none at all. I’m not the only one who feels this way. Don’t bite the ears that feed you, Mr. Bronfman Jr….eventually, you’ll go hungry.
All the labels need to do is raise the amount they receive from Apple for each song sold. Then if Apple wants to keep from losing money, they’ll have to adjust their prices accordingly. If Apple refuses to sell certain songs, then the consumer loses considering there are exactly zero other stores that sell Fairplay songs. Apple really doesn’t have much power here, especially considering how small of a portion the iTMS sales are when compared to all music sales.
Apple spends a lot of that 99 cents on the cost of the bandwidth necessary to deliver these songs, which is why they don’t seem willing to up the quality from 128 bps to something higher or variable. Maybe iTunes should charge by the megabyte and allow for better quality downloads before paying the record companies first.
John C Dvorak claimed, and rightly so in my opinion, that the record companies don’t like the ITMS because it creates an independent source of data on music sales. This makes it difficult to skew the numbers for their creative accounting processes, thus not allowing them to screw the artists as much as in the past.
“‘Not all songs are created equal—not all time periods are created equal. We want, and will insist upon having, variable pricing.'”
Really! you could have fooled me the last time I went to Borders, or Sam Goody. Sure there are cut outs and overstocks and sales, but generally cds cost X amount. I guess what he means is… we want to charge more for current singles because we can promote them and sell them. Greedy, Greedy Greedy Downloads save the record companies a bundle. Because there is no physical product, no storage, no materials, no workers to make it, no transportation nothing. Plus they recieve free promotion thanks to other listeners if things are done right. So at 99 cents I bet per song they make a better percentage than in a record store.
PC Apologist, you’re really good for a laugh, you know that? Some days I don’t know whether you’re trolling or just really, really stupid.
The content providers will pull their content from iTunes?! HA!! Right! With one stroke, they will wipe MILLIONS OF DOLLARS in annual revenue off the books!
Some record companies are making as much as 8% of their revenue from iTMS. That’s 8% and growing. Leaving just isn’t an option.
king_A,
Don’t forget the ipod plays MP3 – you can get that format anywhere -free
content is created equal. i pay 9.25 to see an award winning movie just like i pay to see a horrible one.
From day one, the record labels failed to understand the technology and its obvious direction it was going, and concurently the obvious threat to their monopoly. Their window of opportunity to save themselves passed long ago.
No simpathy for them.
Welcome to the ash heap of history.
I mean if they guy wrote an article you guys would have been on Warner CEO Bronfman like white on rice.
MDN magic word= Pay as in we pay enough!
“We want to share in those revenue streams.”
Does Exxon get a cut of GM’s profits? Does NBC get a share of every TV sold? Does Microsoft get a piece off the hardware of every PC sold?
The labels are so greedy they’ve lost their perspective of reality.