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“Universal Music Group, the world’s largest music company, has declined to sign a long-term deal with Apple Inc.’s iTunes music store, leaving open the possibility for exclusive deals with other services, an industry source said on Sunday,; Yinka Adegoke reports for Reuters.
Adegoke reports, “Universal will continue to sell music and videos of artists including 50 Cent, Mariah Carey and Black Eyed Peas via iTunes on a month-to-month basis, rather than be locked in to a two-year agreement Apple had proposed, the source said.”
“In effect, Apple will now have similar terms to those that Universal already has with the majority of its retail partners,” Adegoke reports. “Some music executives have privately expressed frustration that Apple’s dominant position may have hampered growth of the fledgling digital music market by keeping users locked within the Apple system.”
MacDailyNews Take: No iPod is required to buy and play music from iTunes Music Store. iTunes Music Store use is not required to play music on iPod. Therefore: no “lock-in.” “Lock-in” is nothing more than a fantasy for the weak-minded and/or for those who’ve been soundly-whipped in either the device and/or online content markets.
Adegoke continues, “Universal, which produces one in three albums sold in the United States, has been leading the push by music companies to demand that new technology and media partners who want to license music share in the proceeds of the new products as well. Last year Universal signed a deal with Microsoft Corp. to take a small share of sales of its digital media player, the Zune.”
Full article here.
Okay, so it took Microsoft nearly a year to stuff the channel with 1 million Zunes, so if Universal gets $1 per Zune, they made a whopping $1 million? No wonder they want a slice of Apple’s iPods and iPhones. Microsoft’s Zune is a desperate joke. It’s the WNBA of the digital media device world.*
Mediocresoft was so late, with so little, they would have signed anything because without Universal, the Zune would have been even more of a flop (if that’s even possible).
Does Sony pay Universal Pictures a royalty for every TV they sell? No. Does GE pay Universal Music a royalty for every AM/FM radio they sell? No. But, Apple is supposed to pay royalties to Universal on every iPod and iPhone sold regardless of whether any Universal content is ever even played on Apple’s devices? Why, because Apple is insanely successful? Is that why they should pay royalties where no one else does? Nonsense.
Universal is thinking like a dinosaur because they are one. They are also nuts. Universal et al. are crazy dinosaurs who, if they can’t get their act together very soon, face certain extinction.
*Boring mediocrity that real people couldn’t care less about propped up by vastly larger organizations with agendas unrelated to the product itself. Ginned-up “interest” cannot sustain failure for long.
One of my favorite bands, Blindside, was dropped by their label and decided to release their music, which is awesome, through their own website, not using a label. They called this “the future of music distribution”. This is what Universal is facing and it scares them to death. They don’t know what direction to take right now… I like it.
Hey, check out Blindside, too, at http://www.myspace.com/blindside
They need your help. lol
Hey! Any lawyers out there???
What’s the difference between demanding royalties (on a device that MAY OR MAY NOT EVER contain Universal’s product), and EXTORTION?
Seriously?
Who do we call, States Attorney General’s or something?
I want to know WHAT RIGHT Universal has to MY MONEY, especially if I don’t have ANY of Universal’s artists on MY iPod.
Someone needs to sic the dogs o’ war on these fat PIGS.
Universal has a brilliant new negotiating tactic.
“Give me what I want or I’ll shoot myself in the foot!”
Go ahead punk make my day
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Its about time that Apple luanches the iTunes record label, sign the big name artists and kill off the record industry. Its a business model that has long since past its prime and simply does not work in the modern age.
You can see WHY they are trying to seel UMG, its because they don’t know how to manage music sales in the new online world. Universal is not going to screw themselves out of cash when they sell UMG by axing a deal of some type with Apple. You don’t cut off the 3rd largest music retailer and then go out and try and sell your music division off for top dollar
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MDN:No iPod is required to buy and play music from iTunes Music Store. iTunes Music Store use is not required to play music on iPod. Therefore: no “lock-in.”
MDN keeps fighting this, but it’s still not true. With the exception of the new DRM-free offerings (yay!), there exists a very definite “lock-in” between iTMS and the iPod. Fairplay-protected tracks will not play on any other portable but iPod, or through any other player but iTunes. iPod and iTunes cannot play protected tracks from any other online store.
So if you patronize iTMS, you have ONE option for jukebox and portable, and if you use iPod, you have ONE option for online track purchases. That’s a lock-in. Just because they’re the most successful and the best, doesn’t make it something it’s not. That’s a Microsoftian technique (hardly anyone uses another browser, so we might as well force IE on them…) and it’s baloney.
“Its about time that Apple luanches the iTunes record label, sign the big name artists and kill off the record industry. Its a business model that has long since past its prime and simply does not work in the modern age.”
Apple – “Hey, sign a music contract with us, and you can have the share your old music label got that they did not share with you, oh and we will give everyone in your band a free iPhone
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MW = Large
As in “give the actual people making the music a LARGE share of the money made off of them”.
over the years ive put a couple hundred bucks into the iTms, but not because i have to by any means. if universal yanks there stuff off itunes, thats fine by me. ill just ‘aquire’ it by other means 0:-)
ill be really peeved if jobs gives in, which i doubt he will.
eff the system!
Universal is basically hoping this entices Redmond to bite on the game for exclusivity with Zune – or hopes Apple somehow feels compelled to make a counter offer.
Apple may counter and it goes something like this: Go pound sand.
If Apple wanted to be really aggressive, they would buy Universal, and make it exclusive iTunes only and no-DRM on the music like EMI, and pull the content from any other site, and watch:
– CD sales climb
– iTunes sales climb.
Eveyone else die on a vine.
http://lawgeek.typepad.com/lawgeek/2007/04/dick_dale_expla.html
apple will never agree to it. universal needs itunes as much if not more than itunes needs universal. itunes is the 3rd largest music retailer. universal cant just dump them. nice try on their part… why not give it a shot? ha
“UMG is in negotiations to be sold. I believe this move is to allow any buyer the opportunity to negotiate their own deal with Apple,”
Bingo.
Then I guess Universal has to die, if that’s what they want.
@PC Apologist: “MDN keeps fighting this, but it’s still not true. With the exception of the new DRM-free offerings (yay!), there exists a very definite “lock-in” between iTMS and the iPod.”
Once you make an exception, there’s not much more to be said. Think about it.
PC-
Facts are difficult things. Let’s review.
No iPod is required to buy and play music from iTunes Music Store.
This is completely true. You can buy and play music on a Mac, or a PC. I know…I have both…I’ve done it and listen to iTunes tracks more often on my computer than I do on an iPod.
iTunes Music Store use is not required to play music on iPod. Therefore: no “lock-in.
Also completely true.
I bought the Paul Simon CD, and imported the tracks to the computer, later putting them on an ipod. No music from that album came from iTunes Music store.
It’s true that if I chose to use a different player, those tracks I purchased from iTunes would not play on it.
But at that point it’s a matter of personal preference. I happen to think the iTunes software is just far better than other players. It only matters if you MUST have some particular feature of another player that isn’t in iTunes. I haven’t found one that matters.
So…yes…it’s a “lock-in” but only by controlling the system can Apple make it as trouble free as possible.
Would you think that if they opened it up they would take support calls on why an iTunes track won’t play in ANOTHER company’s software or player?
That would be costly, and largely pointless.
If it works…why fix it? Greed?
“UMG is in negotiations to be sold. I believe this move is to allow any buyer the opportunity to negotiate their own deal with Apple,”
So does this mean the media, as usual, is making a mountain out of a mole hill?
F*CK Universal!! All they put out is crap anyway… Apple please hold firm and don’t cave to these scumbags.
The only thing that ties music purchased from the iTunes Store with the iPod and iTune software is the DRM (and that can be eliminated by burning content to a CD). Who is demanding DRM? And if UMG thinks that tying itself to MS WMA is any better than Fairplay, they are really fooling themselves.
If the iTunes files were not encoded with DRM, then the music files could be played on any digital device that could handle AAC. For that matter, the unprotected (non-DRM’ed) iTunes track can be converted to MP3 or some other format).
Universal is freaking out because all the big labels are corrupt monopolies and they hate the internet because it frees people from their control.
They hate iTunes, because people can actually choose what they want to listen to. The big labels long for the days when they could control what people got to listen to by giving radio DJ’s drugs to play their tunes, and making sure their albums were displayed prominently in record stores. (Oh, and make sure any artist that didn’t sign away all their rights to them wouldn’t be heard or seen.)
What’s worse, iTune’s keeps a clear record of every song that is sold, and thus a record of the fact that the singer and songwriter have to be paid for that. So Universal has to pay artists fairly (or at least kind of fairly) for their work.
But what about all the crappy songs Universal wants to sell? You know, the one’s no one wants, but that some record company buddy or exec wrote. What about the shitting music they paid too much to produce with their champagne and coke parties? What if nobody buys that stuff? It will make them look bad.
That’s why Universal and the other record companies have pushed for subscriptions. They want people to pay for their whole catalog in a non-transparent way. That way Universal gets to decide where the money goes. That way Universal can cover up spending 10 million to produce an album nobody cared about.
Likewise, this is why Universal is pushing for a fee from each iPod. So they get money for all their crap, not just the good stuff. And the executives get to decide where the money goes behind the scenes. They hate the idea of the listener, deciding they like an artist, and then having to pay that artist based on the number of downloads.
Universal didn’t build up a huge catalogue of great artists because they were good at nurturing talent. They did it by buying up other labels and forming a monopoly. They spent money to maintain control over the market. Now they’re fucked, because the market they controlled (radios and record stores) is fading. In part, because they flooded it with too much crap.
I doubt Apple is going to fall for Universal’s attempts to corrupt the iTunes store and the new music market.
If Universal’s music goes off the iTunes store, that will just make more room for Apple to promote independent artists.
And that’s where the real future of music is going anyway.
@ PC Apologist:
I buy all my music from the eMusic store.
GREAT collection, and plays just fine on my iPod.
No DRM, I admit that.
I wonder why MDN has chosen not to report the DECLINE of Mac software/hardware.
http://marketshare.hitslink.com/report.aspx?qprid=3
http://marketshare.hitslink.com/report.aspx?qprid=5
Internet Explorer use went up! GO MICROSOFT!
If it’s not on iTMS, I’m not buying. If UMG leaves iTMS, their artists should consider jumping ship. Perhaps the Apple label?
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the tighter they squeeze the more things will slip through their fingers … customers and artists will revolt against UMG … everyone is getting sick of the music industry bosses …
Continued pressure from music corporations may push Apple/Pixar/Disney into a situation where them will begin producing in the music arena. Disney has all the studio whiz-bang electronics to produce/distribute/promote musicians with both recording and video. They must realize they are not the only people that can produce. I would bet that if Jobs simply started a rumor that they will be signing big name groups/individuals to the ratf*cktootie label, Universal, et al would pass bricks through their little record holes. Hmmmmmm what an idea — any rumor mongers out there??????
Idiots still keep posting FUD, but it’s still true — You don’t need to buy anything from ITMS to use iTunes, and you don’t need to use ITMS to use an iPod.
Universal has a good back catalog, but look at their current offerings — these are all slated for U.S. distribution and a majority of them are in Spanish. Yeah, the multinational corporations are screwing over America yet again.
Just die, Universal. We don’t need you or want you.