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Music Labels May Seek Higher Download Prices
punxking writes "Some of the big music labels are now clamoring to raise prices for digital music downloads. From the article: 'Music industry executives said introductory wholesale prices for digital tracks had been set low to stimulate demand for online music sales but the success of Apple's music store had prompted concern that they may now be too low.'" Relatedly, the BBC is reporting that iTunes is under investigation in Britain for charging disparities between the UK and the European continent.
This is getting ridiculous. Next article, please.
Can I simply ask somebody who really knows? What are the costs associated with digital distribution versus printing and distribution of physical media? Is this simply a case of music labels being greedy? Come on now. This is an industry that simply does not get it. Music sales declined through the late 90's because the music that was being promulgated on us by the music labels sucked. Big time. Throughout the entire decade of the 90's, they waited for somebody else to innovate the digital distribution of music (Napster), and waited for Apple to do it right with the iTunes Music Store, and now they want to profit on top of all of others hard work. I guess it is a business model that works, but come on now, have some respect for what you do! Are you making a profit with iTunes with the current pricing scheme? It would certainly appear to be the case, so why are you now trying to increase prices? The cost of distribution through the Apple iTMS has not changed. Apple has not changed the terms for distributing music in your contracts. Apple is not making any more money on it than previously agreed. I guess we should not really be surprised though. Remember when CDs first came out? Remember the cost of a vinyl album at the time ($7)? Remember the cost of a CD at the time($12-15)? Remember the music industries promise that CD costs would drop when they became popular? Consider especially that shelf space could hold more CD's and the distribution costs for CDs were significantly less than they were for vinyl. Consider that the costs for pressing a CD were/are significantly less than those for vinyl. I would assume that there is an order of magnitude difference in the distribution costs for Internet delivery versus physical media delivery that would make Internet delivery significantly less expensive and thus more profitable.
Here is a prediction: If the price for music increases right now for digital distribution, sales will fall and piracy will increase. Apple did the hard work of market research on what folks want to pay for music downloaded from the Internet and they concluded that
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Slashdot and OSDN are clamoring to raise subscription rates!
/dev/null... "How are we to justify raising subscription rates if the readers weren't getting the same old shit twice?"
In a move that the OSDN bean-counters believe will give Slashdot and OSDN more cash on hand, Slashdot.org is announcing that they are raising subscription rates to $5.25 for 1000 pages of ad-free* viewing.
More and more frequently Slashdot has been giving its readers the opportunity to read day old news AGAIN! The editors of the site claim that this is part of their overall marketing plan:
Rob Malda (aka CmdrTaco) was quoted in the NYT (vampire sucking required) as saying, "well we give you TWICE the news in two days so we thought it was only right that our subscribers pay a little bit extra!"
Zonk was quoted as saying, "well we give you TWICE the news in two days so we thought it was only right that our subscribers pay a little bit extra!"
While Slashdot does have an e-mail link on their site to allow Slashdot subscribers to report these duplicates to the "Editor on Duty" the editors have admitted in secret taped conversations (on IRC) that the email address is bunk and goes to
* - ad-free only refers to banner ads, not posts to the main page that are made to appear as "stories" when they are in all actuality advertisements (i.e. iPods)
I thought they were just talking about doing this a few days ago...Greedy bastards...sheesh!
I'll turn into a supernova and burn up everything. Well I'll turn into a black little hole and you'll turn into string.
Good luck pushing Wal*Mart. They've never bowed to a supplier. If they want to sell digital music at 25-cents a track, the music industry can just take it in the rear.
They want us to download the songs with our network connections that we pay for, in lieu of them pressing CDs and printing inserts, and now we're supposed to pay MORE than you pay in a store for a CD? At $1 a track, it's already not a very good deal. For more than that, the only thing they'll be stimulating is a new resurgence in p2p.
dupe dupe dupe
they duped the URL (dupe dupe)
they duped the URL (dupe dupe)
they duped the URL...
As I walk though
Slashdot's world
Nothing can stop
These dupes of URLs...
etc. etc.
Do you want to submit this one tomorrow and make it 3 days in a row? Or should I do it?
Don't blame Durga. I voted for Centauri.
... Dupe? Perhaps they should start charging more so they can pay EDITORS to FILTER SUBMISSIONS..... oh wait....
So, might as well post my old comment.
I wonder if this push for a price increase is to put a dampner on the existing on-line players as they did with the CARP act a few years ago regarding streaming.
The problem, as the established media companies see things, with these new electronic outlets they have problems excerting their marketing influences to pimp their latest one-hit manufactured artist.
If they can put the breaks on things until *they* control the market then this is better for them. Its not really an issue concering margins as all the big players seem to be reporting big profits.
Oh, wait, there's legitmate places to download music online from?!!!
Primitive peoples often think that you're stealing their soul when you photograph them.
I make no guarentee of this post's relevancy to anything.
the preceding comment is my own and in no way reflects the opinion of the Joint Chiefs of Staff
The discussions are different? In other words, one discussion might have a little more Apple bashing than the other. One discussion will have a goatse link, and the other will have a GNAA screed? In one, 89% of the posts are about whether piracy = theft. In the other, 91% of the posts are about whether piracy = theft. Yes, there really is a difference!
Don't blame Durga. I voted for Centauri.
Well they have to raise prices!
Because the cost of manufacturing has...
Er... Because they have to hire more employees to handle the purchasing load...
Er... Because the Britney Spears needs a new swimming pool for her poodle... yeah!
Isn't it time we just declare the RIAA a monopoly and start regulating it because, obviously, there is no competition.
(I'm reminded of that montage scene in Real Genius where more and more people don't show up to class and instead have tape recorders to record the lecture... eventually the professor stops coming to class and just has a tape to play to the tape recorders...)
http://apple.slashdot.org/article.pl?sid=05/02/28/ 1738239&tid=141&tid=3
Can we please stop this nonsense?
Reject Fear - Embrace Hope
The music industry loses all credibility the moment it says "Apple may become too powerful."
Oh, so now Apple is trying to take over the world?
What next? The Salvation Army?
These are the same people who are trying to say that piracy is the reason that they're not making wads of cash? Did they miss the whole supply/demand/equilibrium price part of economics class in high school (okay, some of them may have gone to college).
Let's see. We have a product that is being sold at a price point that has people drooling, there are very low distribution costs, no need for shipping or inventory maintenance, and people can buy from home. Sounds good...*too* good...let's raise the prices and kill it off.
asshats.
"Murphy was an optimist" - O'Toole's commentary on Murphy's Law
The music industry thinks that because iTunes is a success, the prices must be too low. That explains why CDs sales are down. Every time people start buying them, the music industry raises prices. The music industry seems afraid of success, every time it gets close, they squash it.
If someone says he and his monkey have nothing to hide, they almost certainly do.
The main "iTunes raising prices" is a dupe from yesterday, and "iTunes under investigation in the UK" is _ALSO_ a dupe from a recent article. Jesus christ, Taco, if this were a free-site and you were not getting PAID for it, I could see slacking off. But damnit, you have advertisers and subscribers. That implies a certain level of responsibility. Live up to it.
Pretty soon they will give us what we have all been waiting for... A /. article whose primary source is another /. article.
Or well, I guess there's a third option to make 99-cent downloads competitive: raise the price of CDs. ;-)
The very idea that download prices are too low, is just ludicrous.
As copyright owner of this comment, I authorize everyone to defeat any technological measure which limits access to it.
The bits are gold plated for high fidelity.
It's a shame that all these dupe posts are getting modded down. It's about time the Slashdot editors actually see what a mess Slashdot has become. They seem to post a dupe every day now.
Please, stop modding those posts down. This duplicate posting must stop.
--- witty signature
this is what the music companies are doing with degraded MP3s at a higher cost per song than the original album.
You must have missed economics 102 then.
There are other things to consider in "selling" a product. What the market will bear is largely a simplistic economic viewpoint that looks at discrete periods of time. This is a model that will get companies and individuals who advocate those models in trouble with examples like bubbles. Specifically, like those that occurred in the tech markets of the late 90s and the current real estate markets in some parts of the country.
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I kind of like Walmart's discussions with the media industry a little better:
-- I was raised on the command line, bitch
a) Started out "free" -- reasoning the bank didn't have to pay so many human tellers.
b) Moved to a small fee for the operator of the ATM, which is understandable.
C) Fee doubled when your bank realized it could charge you in addition to the charges of the ATM operator.
D) Mext the fees nearly doubled to an average of $1.50 each side of the transaction (minus the "free" out of network uses you get per month).
E) Finally -- we end up with bank plans where you can be charged to talk to a human teller.
If we figure out where we went wrong with banks and ATMs it might help us not repeat the same mistake.
Of course and your absolutly right, except the part about selling something for pennies that cost dollars to make, noone would do this unless they are trying to liquidate their assets.
Anyways of course we have no reason to complain when an industry raises its prices, we should then be complaining to the people who purchase at the higher price of course. On the otherhand if there is a monopoly on the item it can be illigal to bump the price too high. One could argue weither the MPAA is a monopoly, but as its not a essential service it really isn't the governments buisness.
All in all most people here see rising music prices as a bad idea, and firmly beleive that the industry will lose money on it. But apparently the industry is willing to lose money and point to the P2Ps for blame.
I would point you to Slashdot Editor Training, where all Editors learn how to avoid dupes, perform thorough spell- and fact-checking, and (best of all) write well-crafted, bug-free code.
Yeah, right.
You see, if they make it painful enough to buy tracks online, we'll all revert back to the old model of taking it up the rear at our local record store for a 25 cent chunk of plastic. Online music sales scare the crap out of the recording industry because they become obsolete the second somebody can simply make their music available online to whomever wants to download it. If recording industry can kill online music sales early, they won't slowly fade away into obscurity as recording artists choose other venues to promote their wares. iTunes has somehow, despite the industries best intentions, (through extremely high prices for what you're actually getting), become a viable alternative to the old way of getting music. Therefore, they raise the price even higher to discourage sales. If the price is high enough, people will return to the old business model.
THis is just more evidence that the MPAA and Micro$oft are just out to screw the consumer vis they want us to pay more and more for their so-called "music" which is all Bri[tt]ney $Pears rubbish which they play over and over again on their network of Clearchannel radio stations thanks to payola IE LEGALIZED BRIBERY forcing everyone to download the music from the Internet using services like Kazaa and Morpheus anyway, whereas if the music industry eg the MPAA would just give music away on DRM-less MP3s at 384kbps (the MINIMUM I will accept, 314kbps AAC is TOTALLY UNACCEPTABLE, you can really hear the difference on top-end Sony equipment) and if they'd make the music actually WORTH LISTENING TO then they would be "getting it" and working in the new economy not the old economy. This is why personally I download all my music from dodgymp3s.ru where you pay a penny a megabyte which is much fairer because the money goes to the artists according to the website, well the bit left over after taxes and expenses and protection racket fees, rather than to the money grabbing record industry execs who spend all their money on cocaine and DVDs.
Are you all with me? Yeah! Fight the fat cat record execs!
You are not alone. This is not normal. None of this is normal.
saddino writes "Steven Levy at Newsweek is reporting that Slashdot seems to favor certain stories for dupes. Is Slashdot receiving kickbacks to promote certain companies? Slashdot denies it, of course, and Levy had the good sense to ask a mathematician and a cryptographer who explained it's probably just humans finding patterns where there are none."
For the vast majority of people who would be considering buying online music, anything less than a dollar is change not worth worrying about, so it is much more "disposable" than things that are priced more than a dollar. That is why retailers list things as .99 instead of 1.00.
And while I know prices can never stay the same due to inflation, I have to say that the industry deserves no more out of this than they're getting. I'm using MY bandwidth that I pay for to get their product. They're not even providing me with the method to do so, Apple is.
Buy Steampunk Clothing Online!
Except this never actually happens. I wouldn't expect slashdotters to have any first hand familarity with heroin or the drug trade, but let's just think this through in a few steps.
1. Demand for heroin is extremely high.
2. Supply for heroin is extremely limited.
3. This lack of supply, coupled with extreme demand, will produce very high prices.
4. Extremely large profits can be made easily in this trade, as there is a large volume of willing buyers with little "brand" loyalty, and a consistent "regional price" (compared to a "world price" in macroeconomics) due to easy (local) transport and a highly liquid market.
So the major problem in the heroin chain is not selling (very deep liquid market relative to supply), but instead obtaining supply to sell.
Now that we know this problem, ask yourself why dealers would choose to give away supply? Answer: they don't. There is no benefit to them, as there is already a large volume of willing buyers. There is only downside, namely the opportunity cost of not selling the damn stuff instead of giving it away.
Too many people have this vision of a guy hanging aroung with a truck of heroin twiddling his thumbs wondering how to addict people and make cash. Doesn't quite work like that.
Think of the dupe as a remake of the original "classic" post.
Wal-Mart Squeezing Record Labels to Cut CD Prices
Posted by michael on Thursday October 14, @08:25AM
from the win-win-situation dept.
Raindance writes "RollingStone.com has a revealing article detailing how retail giant Wal-Mart is making loud noises about throwing its weight around in order to get significantly better bulk prices on CDs. Says one industry executive, 'This wasn't framed as a gentle negotiation, it's a line in the sand -- you don't do this, then the threat is [your product is dropped].' This is the first time a big player has attempted this sort of hardball move on the labels, and the labels may be forced to deal, as Wal-Mart sells 1 out of every 5 retail CDs. Monopoly one, meet monopoly two."
Telling quote from the linked Rolling Stone article:
Tensions are not as high now as they were last winter, but making sure Wal-Mart is happy remains one of the music industry's major priorities. That's because if Wal-Mart cut back on music, industry sales would suffer severely -- though Wal-Mart's shareholders would barely bat an eye. While Wal-Mart represents nearly twenty percent of major-label music sales, music represents only about two percent of Wal-Mart's total sales. "If they got out of selling music, it would mean nothing to them," says another label executive. "This keeps me awake at night."
So, it seems as though Wal-Mart is playing chicken with the music labels, betting the labels will blink first. I would suppose if they can do this with physical media, they can do it with downloads as well.
Many in the music business also expressed concern over Apple's growing clout. This stems from the fact that Apple's music store and player are not compatible with any others. One fear is that Apple will become too powerful if consumers continue to choose its digital music platform. Apple declined to comment.
"One fear"? I'd say it's the main fear. The sticking point is not Apple's proprietary technology itself as much as how market share allows Apple to assert downward pressure on per-song pricing. The music biz wants to kneecap Apple. The goal is to force Apple to open the iPod/iTMS, distribute the platform's market share among any number of companies, and so get digital distribution fully under the music industry's thumb. Cartels like chattel, not coequals.
The big question is: if Jobs refuses, will the labels start to defect from iTMS? Apple will have planned for this scenario and their response is going to be very interesting--it will tell us pointedly where the power truly lies.
P2P doesn't work to solve the problem. It only antagonizes, and what's worse, it provides the with the rope that they have used to slowly hang us- in the form of ever-restrictive laws that govern copyright and fair use. If you disagree with the price increase, don't "share" the music. Do what you'd do with any other product - just leave it. Let the RIAA wallow in its own muck until someone finally has a lightbulb moment, and "gets it".