Growth of UK ‘iTunes-style’ music services hobbled by ‘greedy’ record labels’ high prices

“High prices and digital rights management incompatibility are slowing the take-up of online music services in the United Kingdom, according to analyst IDC,” Jo Best reports for CNET News. “Jason Armitage, senior research analyst for IDC’s European consumer devices unit, said that despite the rapid increase in the number of iTunes-style stores, the U.K. has yet to benefit from more choices or cheaper pricing… Armitage said that part of the problem is that record labels aren’t passing on the savings from selling music in digital format to their customers.”

“It’s a troubling issue for Apple Computer CEO Steve Jobs, the man behind No. 1 online music store iTunes,” Best reports. “‘Record companies make more money on iTunes than they do on CDs,’ Jobs said. ‘If they want to raise prices on iTunes, it just means they’re getting a little greedy–consumers won’t like that. It will just be a message to consumers to go back to piracy, and that’s not good. If the price goes up a lot, they’ll go back to piracy and everybody loses.'”

Full article here.

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Warner music exec discusses decapitation strategy for Apple iTunes Music Store – September 28, 2005
Warner CEO Bronfman: Apple iTunes Music Store’s 99-cent-per-song model unfair – September 23, 2005
Analyst: Apple has upper hand in iTunes Music Store licensing negotiations with music labels – September 23, 2005
Steve Jobs plays high-stakes poker with greedy record labels – September 22, 2005
Record labels accuse Apple CEO Jobs of ‘double standard’ as they seek to force iTunes price increase – September 21, 2005
Apple CEO Steve Jobs to repel ‘greedy’ record companies’ demands for higher iTunes prices – September 21, 2005
Apple CEO Steve Jobs vows to stand firm in face of ‘greedy’ record companies – September 20, 2005
NYT’s Pogue to record companies: it’d be idiotic to mess with Apple iTunes Music Store prices – August 31, 2005
Apple CEO Steve Jobs prepares for pivotal fight on digital music prices – August 28, 2005
BusinessWeek: Apple unlikely to launch music subscription service – August 15, 2005
Record labels to push Apple for higher iTunes Music Store prices in 2006? – August 05, 2005
Study shows Apple iTunes Music Store pay-per-download model preferred over subscription service – April 11, 2005
Record labels look to raise iTunes wholesale prices, music industry fears Apple’s market domination – March 05, 2005
Report: Apple CEO Steve Jobs ‘angered’ as music labels try to raise prices for downloads – February 28, 2005
Report: Music labels delay Euro iTunes Music Store fearing Apple domination – May 05, 2004
Greedy Big Five music labels looking to jack up iTunes songs to $2.49 each? – April 22, 2004


  1. Eventhough I am a Mac user I wouldn’t consider anything else but iTunes nor even in discussions mention what the ‘others’ are doing.

    Even today HMV announced a profit warning as it is not selling as many CD’s/Records as it used to only a year ago.

    I happened to walk past my local store and even with a new college campus only 2mins away the store was nearly empty. Yet this was around 1.15pm, lunchtime for many in my book.

    Oh and ‘first’ up there you weren’t first as a posting saying ‘first’ is not a response to the above article. Perhaps you can clarify your comment for me, in what way in reference to the article above is there a first, an Apple Computer first perhaps?

  2. Dear John Kerry,

    It was a shame you didn’t win the election due to an Austrian born Govenor of California, but hey what does it matter after all you still remember your college days with George W.

    Still keeping up with the old gang at ‘Skulls and Bones’ secret society who are determined to ensure that the US population are treated like ‘cattle’ inline with said secret society rules?

    You called him on the day the world found out the ‘result’, best of buddies or should I say ‘Skulls Forever’!

    Thus no hard feelings, after all you are related in your bloodline to Jebediah Bush of Boston, MA.

    MW: ‘york’ as in I practice the only true honest and good rite of the world, the york rite.

  3. 1/2 billion itunes sales and huge ipod uptake in the US isn’t matched in the UK because 79p per track is too high. 60p would be the UK equivalent of 99c and closer to the euro pricing.

    Apple aren’t making a killing on the sale of tunes as most of the cash goes to the record companies. Whilst it remains at the current stupid price the high uptake of ipods in UK will continue to be filled with music ripped from CDs or downloaded from peer to peer sources. The ball is in the court of the record companies – I don’t think either way will seriously impact pon Apple’s sales or market share.

  4. Yes that is right Max,

    Do you recall the legal action that Which? formerly the Consumer’s Association are taking against Apple for iTMS pricing differences between the UK and the Eurozone stores to the European Courts of Justice (ECJ)

    Well since it seems that the record companies in all their rants and demands for raising the price may’ve undermined the efforts of Which?

    I am neutral in that battle, however it may mean that instead of the UK iTMS store lowering prices inline with Europe it might be the other way round and the Euro store raising to meet that of the UK iTMS store. Not to say that further raises will be made to meet those at the Japanese iTMS.

    I am though with Jobs and his stance at keeping the pricing model where it is, and in one of my above postings about the announcement from HMV proves that we here in the UK are happy to pay £0.79 per track, I know I am and not pay higher prices like we used to in stores like HMV for our music choices.

    Yes since iTMS opened for business those stores have lowered their prices on some CD’s to mirror that of iTMS I am beginning to think that this is the crux of the matter with Bronfman, Jr and his cohorts.

    They cannot afford to sell CD’s in physical stores at iTMS prices. Too bad!! After all CD manufacture is not cheap considering the dustfree environment required to ensure adequate quality of each CD.

  5. The UK has a higher standard of living and better education system than the lagging, bumbling has-been U.S.A.

    Most of the native-born U.S. citizens can barely tie their shoes. You need foreign students just to fill your science/math/engineering courses at your foreign-taught universities. Over half of you voted (allegedly) for the stupidest, knuckle-dragging, phony-christian moron in the history of democracy.

    We don’t mind being insulted by you U.S.A. cretins. You make us laugh just thinking about you, which, fortunately, we don’t have to do very often.

  6. macjammer, the EU investigation will no doubt be as swift at reaching a conclusion as the one it has been fighting with M$.

    CD’s cost bugger-all to produce. The money is in the packaging, promotion/marketing and distr costs. iTunes reduces the exercise to promotion/marketing.

    If the record is any good it will sell shed loads and if its crap it sells one or two – either way they don’t actually have to produce and keep distr up for their whole back catalogue which can sit on servers fro free.

    So the bottom line is that the greedy bastards just want to squeeze more out of the system from the ipod buying middle-classes. Unfortunately they don’t own the distribution channel and so they are squeeling like stuck pigs.

    If they can’t work out that 10 sales at 60p is better than 2 at 79p then let them bloody rot.

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