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Jobs Resists Music Industry Pressure
Drew writes "Steve Jobs is opposed to raising the price of online music sales, calling the music industry greedy, and
implying that price increases will bring about more piracy." From the article: "It may not seem like it, but it has been more than two years since the launch of the iTunes Music Store, and that alone has the music industry brimming with hopes for price-adjustments. They also don't buy Jobs' argument that a price increase will result in more piracy, but probably not for the reasons we might assume. I've long been of the conviction that piracy is not nearly as large of a problem as the RIAA makes it out to be." Also covered at Macworld.
Am I missing something? They're going increase the price of songs so you're paying pretty much the same price as a cd to have it in a proprietary, non-portable format with no artwork and nothing tangible? What benefit would people be getting from the iTunes music store at that point, exactly?
As the price of reproduction drops, the price of the item should drop correspondingly. At least that's how the economic theory goes. Profit margins drop but profits are made through bulk sales, much like today's commodity ethernet cards and memory chips. It allows for many companies (or artists) to create a product, spurring competition, providing choice. All of this is good for the consumer.
Yeah, the RIAA is still trying to stick it to us.
Ok. First of all, I don't know exactly what they're talking about - online or Pressed CDS. But, selling a song for $.99 or $9.99 an album WITHOUT HAVING TO PRESS A CD, MAKE COVER ART, have a jewel case, and truck it to the stores, is pretty steep. I was part of a survey a couple of years ago asking "how much would you pay to download a song?" I answered, "$.25" Asked why, I answered, "Because the music publishers do not have any media costs other than bandwidth and royalties. Excluding the royalties (which are a constant), bandwidth is MUCH cheaper than jewel cases, CD, physical distribution costs (trucking of the CDs, etc...) and the artwork."
In short, I think Jobs is right on the money here.
Evil people don't think they're evil. - George Lucas, Making of Ep III
But why not cut out the middle-man? We don't need "the music industrie" for on-line music do we?
Artist -> Online shop -> Customer makes more sense to me.
The online shop (iTunes for instance) could take care of the marketing as well.
The glass is half-full. With poison. And there are cracks in the glass. The dirty, dirty glass.
The difference between Steve Jobs' wealth and the RIAA is that Steve grew his own business and continues to do so. The record companies want to raise prices for doing nothing. Being a billionaire is not necessarily a sign of being greedy if you work for it. The RIAA is a bunch of middlemen that lets others work for their wealth, so they are decidedly greedy.
Bill Clinton: Pimp we can believe in. - The Shirt!!!
"I SHOULD BE ABLE TO FREELY DOWNLOAD THE NEW VERSIONS as they represent a more accurate representation of the recording I purchased the rights to hear."
Just like you should have the rights to download OS or applicaiton updates forever? If you weren't happy with your music choice at the time you should not have purchased it, simply because it's improved later does NOT give you the right to receive a free upgrade.
"How come no one has ever brought this up?"
Because it is a stupid idea.
I don't believe parent is talking about the end-user machines the content is delivered to.
If you don't think there are real costs associated with distributing music, you are mistaken. The server space, the CPU, and the bandwidth needed to store, process, and deliver the ~5mb/each songs to the end user, are not free. Apple pays royalties on the songs and pays for the above, so their profit, while significant, is not 100% of the money they get.
I, for one, applaud Jobs - instead of succumbing to pressure and using the price increase to increase his profit margins, he's doing something decent by resisting the record companies' pressure. Granted, his motives may not be entirely altruistic, but nevertheless, Apple is setting a superb example that, no doubt, many companies will follow. If Jobs keeps prices at 99c a song, competing services will hardly be able to raise prices without losing customers to Apple - something they decidedly do not want to do. So in this case, Jobs is keeping the market stable in the face of significant pressure from the record companies.
The age of free legal (or even semi-legal) mainstream music has come and passed. You still have advertisement-supported radio, but to legally get ad-free, high-quality music, you can no longer go to a source like KaZaa and BitTorrent and expect the transaction to be risk-free (although I haven't heard of anyone being nabbed for getting MP3s from newsgroups, IRC, or various FTPs.) Not to say that there is significant risk - about 15 of the ~1200 tracks on my iPod were obtained through "good" sources, and I've yet to hear a word from anyone - but it is no longer as convenient or as safe to download them illegally as it is to buy them. This creates a balancing act between the difficulty of obtaining music freely/morality/risk factor and the price of legal music, and Jobs realizes that disrupting that balancing act by raising prices could create a trend of dissatisfied customers that decide to switch to illegal methods.
What puzzles me, though, is how blindly record companies are pressuring the distribution networks that are, in a way, their safety net for the tech-savvy majority of the highly appealing 18-25 demographic. While I've stopped expecting intelligent decisions from them long ago, the RIAA are now crossing the boundary between pure greed and pure stupidity. I believe that this will, eventually, kill them, and I, for one, have no objections to that.
Genius may have its limitations, but stupidity is not thus handicapped.