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Music Exec Fires Back At Apple CEO
geniusj writes "Warner Music Group CEO, Edgar Bronfman Jr., has fired back at Steve Jobs in response to the Apple CEO's claim that having variable pricing for iTunes music would be 'greedy.' From the article: 'To have only one price point is not fair to our artists, and I dare say not appropriate to consumers. The market should decide, not a single retailer ... Some songs should be $0.99 and some songs should be more. I don't want to give anyone the impression that $0.99 is a thing of the past ... We are selling our songs through iPod, but we don't have a share of iPod's revenue ... We want to share in those revenue streams. We have to get out of the mindset that our content has promotional value only.' Perhaps iPods combined with iPods are selling music as well, and it's not just a one-way street?"
I don't think so. Why should they deserve a share of iPod sales?
is not fair to our artists
:)
!?
Maybe the record companies should get a cut of every CD player and stereo system ever sold?
An oil industry spokesman said the oil industry should not have to use its content to promote the sale of vehicles for Hummer or anyone else, and not truly share in the profits.
“We are selling our gas through H2, but we dont have a share of H2’s revenue,” he said. We want to share in those revenue streams.
The cash register industry did not return calls seeking comment, but representatives for the tobacco industry are reported to be participating in high level talks with the AMA.
Quantum materiae materietur marmota monax si marmota monax materiam possit materiari?
So I guess no songs should be LESS than $0.99. Apparantely that is the minimum value for all music clips of any length or quality. Oh, and I like how they want a cut of the "iPod" revenue. Maybe they should go after CD player manufacturers and home stereo's too, by that logic. Classic.
fuck the golden eggs. we demand platinum!
Some songs should be $0.99 and some songs should be more. I don't want to give anyone the impression that $0.99 is a thing of the past ... We are selling our songs through iPod, but we don't have a share of iPod's revenue
:\
So yeah. It will never be cheaper than 99 cents. We don't want to give people that 99 cents is a thing of the past, but we want a piece of the pie, and 99 cents isn't doing it.
Real bright there guy. You suck.
Tell you what. Let's go variable then. Songs older than 5 yrs are 50 cents. More recent non-top 100 tunes are 99 cents, and top 100 are $1.50.
Of course that will never happen.
Karma: Chameleon (mostly due to the fact that you come and go).
That's all well and nice, but raising the price of a song by ten or twenty cents means that your local artist may now receive another half-cent! Don't you feel like you're helping out now?
Let the market decide? Oh give me a freaking break. There is no market, not in the free market economics sense of the word anyway. I can buy petrol, gas, cars, PCs, coal, condoms or even a blowjob from any number of suppliers. This competition drives down prices and forces companies to compete on quality and price. Copyright guarentees as monopoly on your product. If I want to buy the latest white-stripes album I can only buy it from one label: V2 Records. Sure I can go to different stores to try and hunt down a lower prices but V2 set the price. The consumer only has one choice: buy it, or don't buy it. In a real free market economy the consumer has a third, more powerful option, to find a cheaper supplier.
This is terrible for the consumer and almost always leads to disproportionate prices. Rather than supply and demand setting the price of the music, V2 can simply mandate it and then it will be so. The market becomes distorted and everybody loses except the labels. There's this idea that the artist somehow needs to be compensated for his work and that's fine but why not do it off ticket sales for concerts? I don't see why we need these artists need these government granted monopolies to make money!
Simon
Since when does the supplier legally tell you what you can sell a product for?
Generally, that is considered illegal.
But hey, who am I to talk, I haven't been convicted of price fixing, so how should I know?
Oh wait, they have.
Some songs should be $0.99 and some songs should be more.
How about some songs should be $0.99 and some should be less?
Feel the fear and do it anyway.
I have posted this on slashdot before but I think it warrants posting again for this article.
We all have seen the many publisher provided services for purchasing E-books, E-Music, and Software Downloads.
These services try to limit your options and choices or even to remove them from you totally. With many of these services you must agree that you do not even own that which you wish to purchase in order to buy it. Instead they license you right to use their private property.
We see the prices on the virtual which rival that of the physical. We instinctively know that the production cost of a E-book, Downloaded software, or MP3s is so much less than the cost of a compact disc or a printed book both of which require paper, ink, artwork, packaging and so much more that is totally lacking from the ethereal versions.
Their sales decline. "Stop the thieves" they cry out into the night! Make more and harsher laws to protect that which is already protected they demand of our governments. Protect our property and damn their rights is their idea of an ideal. I am a honest person is my vehement reply. So why attempt punish me for the crimes of others.
They attempt to smother new technology on the premise that it may possibly be used for illegal activity.
While it is not my intention to justify the misappropriation of their material I must point out it's their own fault really. I blame their lack of foresight and their lack of anything resembling common sense. They do not exploit the markets available for them or if they do it's a halfhearted attempt. In the real world people are not buying what you sale one common step generally taken is to consider lowering your prices until your sales pick up. This also applies on the Internet.
In a concise conclusion I state that I personally prefer to compensate the authors and composers of the material that I so enjoy in my daily life. Currently I do so off-line. So Publishing and recording industries I say make it worth my while and convenient to do so and I will be one of the first in line online.
"GET / HTTP/1.0" 200 51230 "-" "Mozilla/4.0 (compatible; Setec Astronomy)"
I actually think variable pricing would be OK -- if it went the other way. Make some songs 99c and some less. After all, music is part of the computer world now, and in the computer industry prices only go down. :-)
As for wanting a share of the music player revenue stream and needing to "monetize their product", what's wrong with the ~75c per song of pure profit that they're making now? Music labels didn't get a cut of Walkman or Discman sales; why should anything change now?
The exec is exactly right. Used CD stores are proof that the market demands a lower-cost place to purchase certain songs.
I'd like to see a DRM technology that allowed music buyers to resell the music on eBay... By allowing the owner to set the price, you allow reselling and variable pricing... the studio (original owner) could get a piece of every transaction...
Amazing magic tricks
Do TV studios get a cut of TV sales?
Do software developers get a cut of computer sales?
Do game developers get a cut of console sales?
[Insert countless other examples]
Ummm... No.
That's the best suggestion I've heard so far. Even if 99 is the lowest the music industry wants to go, what about 99 for stuff older than 5 years, $1.25 for newer stuff and $1.50 for top 100 stuff? It might get people to look a bit more broadly than whatever's on the radio today, and in so doing realise what dross most of the top 100 is, compared to stuff that has stood the test of time. And if not, well at least the record industry's mammoth profits are mostly at the expense of people with poor taste ;-)
"'I pass the test,' she said. 'I will diminish, and go into the West, and remain Galadriel.'"
- JRR Tolkien.
This only makes them sound even GREEDIER than Jobs painted them.
Sometimes, the best thing to do with a certain type of person is sit back, keep your mouth shut, and let them bury themselves.
Mod me down with all of your hatred and your journey towards the dark side will be complete!
and songs 10 years old should be 25 cents.
songs 20 years old should be 12 cents.
songs 40 years old should be 1 cent.
and the RIAA/MPAA should be burning in hell.
should is a wonderful word. let's show some respect for it.
Science : Proprietary , Knowledge : Open Source
There is nothing wrong with variable pricing. I doubt Jobs would be against it if they wanted to sell tracks for 50 cents. The problem is when they say "Variable Pricing" what they mean is "Variable Pricing ABOVE $1".
Comment forecast: Bits of genius surrounded by a sea of mediocrity.
here's the quick version:
Apple: "You guys are greedy."
RIAA goons like Bronfman: "We're not greedy. We just want all that money Apple is making. We don't want to do any extra work or promotion. Just send us more cash."
Electric Monkey Pants
Let the market decide the price? Well, Napster will let you have access to 1,000,000 for $10 per month. Now, it's not really far to say that $10/1,000,000 is the price, because you can't listen to that many songs in a month. An average month has roughly 44,000 minutes in it. Figure an average person will sleep through a third of that (eight of 24 hours), and (let's through the industry a bone and say that I'm a shallow teenager with no attention span) a poop -- sorry, pop -- song is 2.5 minutes long, that's about 5,849 songs that I can listen to for $10. That means each song is worth $0.0017 -- a tenth of one cent.
The free market rocks!
Wait... wait a second. He didn't say anything about being cheaper than 99 cents, did he? Crap.
That reasoning might hold water if they were actually investing in the bands. In actuality, they’re merely loaning the bands the money. Even if their “investment” tanks the artist is still obligated to repay the loan.
Quantum materiae materietur marmota monax si marmota monax materiam possit materiari?
In fact it's perfectly fair. Due to the nature of online content, the song only has to be produced once, and it's possible to sell an arbitrary number of copies for virtually zero cost. Therefore, the better a song sells, the more revenue it produces. Therefore, even if a good song is sold for the same amount as a miserable song, it will produce more revenue. It just got much harder to sell crappy songs because consumers there's no more way to force consumers to buy them (e.g., by bundling them with good songs). So, the $0.99 is only bad for the music industry if the majority of their songs are crap. Since that is currently the case, they want to change the pricing model.
Georg
Indeed. This guy just confirmed what everyone suspected. It isn't about variable pricing below and above $1. It is about $1 being the minimum - I bet they'd want to charge $2 for big name singles. This just vindicates Steve Jobs' opinion even more.
At higher prices, you might as well buy the single from a CD store - you'll get a couple more tracks thrown in as well.
I don't mind concepts like (values are pulled from thin air):
Buy One Song: $1.39
Buy Two Songs: $1.19 each
Buy Three Songs: 99 each
Buy Ten+ Songs: 79 each
because that gives a logical discount for bulk purchases, which isn't a bad idea in my mind - especially if purchases are cumulative over a month.
Just because you "bought" your iPOD, don't think you have a right to use it. If they have their way, you'll license the right to listen to music on it, and pay a subscription fee, just like Sirius or XM now.
There is no reason at all that the artists need a middle man taking his cut and doing nothing but reduce their income by being stupid.
Let the music industry find another online music store that's willing to sell the songs at variable prices. Then that store can compete with iTMS and the market will decide which pricing scheme is better. That's the way the market will decide, not by the suppliers forcing Apple to sell the music and different prices.
Jobs is batting a 1,000 on this one. "The music industry has done little or nothing to earn the raw profit off of iTunes sales."
The rebuttal from the industry shows how ignorant they are of the new economy structure that has been in place, for how long? 6 years.
My God people.. Wake up! It's the 21st century and you are employing your goons and torpedos in old-fashioned payola tactics and strong-arming old women for the sake of a few bucks instead of embracing the new economy.
First rule of holes; When in one, stop digging.
They don't always set the profit maximizing price and that's the real interesting thing. Sometimes they set a price that's too high, where even in a monopoly situation they'd make more money by lowering it, but they don't realise that.
Part of this is because real economics isn't as simple as the little supply and demand curves we were shown in ECON 202. For anything that's an entertainment product, it does not ever exist in a complete monopoly situation. Even if you have a complete stranglehold on one kind of entertainment, people can and will substitute other forms.
That's one of the reasons the media industry is taking a hit, more people are playing video games than ever before. Well, unless you are a trust fund kid and have tons of money and no work to do, we all have limits to the amount of time and money we can and will spend on entertainment. So the more we spend on one form, the less we'll spend on another.
So, in a way, the market IS deciding, and they are deciding on less music, more videogames and price is a part of that. Raising the price is sure as hell not going to help things.
There is obviously a transition, albeit slow, at hand. I read and hear more and more often of known musicians doing their own recording and there's a growing number of indie artists doing everything from soup to nuts - meaning recording, producing and marketing their own content. I wish things would speed up. What does it take for this trend to gain momentum? How come I don't see these artist who are involved in producing and marketing their own content banding together and creating their own marketing campaigns to promote purchasing music online? A campaign in direct challenge to these goddamned douche-bag record companies crap anti-piracy/it's not fair to our artists three ring circus?
Here's what things I see needing to happen before everyone can fully give the labels the collective finger
In short. revolt, tear it all down and then all of you people out there in the industry who have an honest and useful talent step up and rebuild it. There's no reason you shouldn't continue making a living and there's every reason to rethink your business and end up making much happier customers and in turn making yourself a really nice living. To hell with fighting the existing recording industry. To hell with them, go around them. What law exists that sa
I remember going to Sam Goody at the local mall and each and every Casette Single was $2.99 if you wanted the hot new single on CD, it was $4.99, all of them. The Record Industry didn't mind that. They never argues that once a song hit #1 the single should cost $3.50, odd I think. Wait odd isn't the word, it's BULLSHIT! Yes that was the word that I was looking for. This man is full of shit. Thank you
I boycott signatures
And for my next demand, I want a law forcing all consumers to buy our products at the prices we, in our infinite wisdom, set for them. No more of this voting with your pocketbook -- or feet stuff. After all, we are vital to the American economy -- and yacht salesmen everywhere!
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
This guy seems to imply that the music industry can kill the iPod by refusing to sell through the iTunes music store. This would only be possible if the vast majority of iPods was not filled with songs from P2P serivces and ripped CDs.
suppliers have every right to set the wholesale prices for their products. however, how the music industry has and is conducting itself is just pathetic; and if apple had a CHOICE in who to purchase their tracks from, i'm sure they'd be looking at alternatives.
as i understand it, there's a contract up for renewal between apple and the music industry? this would just be posturing during the negotiations. normally the public isn't exposed to the bickering, lies and pissing matches between a retail outlet and their suppliers during the purchasing process.
if apple knows what's good for it's customers, they'll push for wholesale rates that allow them to maintain the current retail price. if the music industry knows what's good for itself, it'll LOWER their wholesale prices..
the more expensive something is: the more likely it is to be stolen or pirated. and the fewer units will be sold. the industry's goal is to jack prices as high as they can, so long as gross receipts doesn't drop due to lowered sales volume. and if they can get away with locking the content down so tight you need an riaa exec's thumbprint to play a tune, so much the better for the them (riaa).
the less expensive something is: the more likely it will be bought and paid for, and as a result, pirated or stolen less. lower prices equal higher sales volumes, which can mean higher gross receipts. likewise, the more convenient and desirable a product is, the higher the sales volume will be.
the music industry wants to (and does) charge the highest possible price for music, even though that lowers demand and sales volume (why don't any of the riaa sob stories about lowered sales due to p2p mention the HIGHER prices for music during the same time period?). they could instead work to find the LOWEST price that generates the same (or even more) revenue due to an increase in sales volume at the lower price. (actually any industry could do this.. but many choose not to)... noting that the LOWER price translates to better overall p.r., and happier customers who will be more apt to be repeat and/or higher volume customers
and lastly, the crappier the music is: the less likely anyone will even bother pirating it, nevermind buying it. HMMM.. i think i just figured out why current music SUCKS... they're forcing the crap on us to discourage piracy.. tricky little buggers....
"We want to share in those revenue streams. We have to get out of the mindset that our content has promotional value only" OK, then, start releasing music with more than "promotional value". To quote Col. Bruce Hampton, "The best thing about popular music is that it isn't popular for long." Take Care - ZC
When I was a kid, I used to pray every night for a new bicycle. Then I realized that the Lord, in his wisdom, didn't wor
Doesn't this prove Steve's point that the records industry is getting greedy?
songs over 14 years should be public domain
A lot of people are griping that this exec only sees a need for pricing above $0.99.
People, read the news!
"That's not to say we want to raise prices across the board or that we don't believe in a 99-cent price point for most music," he said. "But there are some songs for which consumers would be willing to pay more. And some we'd be willing to sell for less."
I think the $0.99 model for any song is stupid, because it doesn't reflect the value of the song. Some songs should sell for $0.01 and some should sell for $10.00.
He's also forgetting that once there's a disincentive to downloading popular songs, they're going to get downloaded less, and since the music charts themselves are based on the quantities purchased, the top songs will fall down the charts and into a lower price bracket, thus simultaneously making the charts meaningless and ensuring that the music industry won't actually realize the extra profit this move was supposed to give them. Brilliant.
"There's no content that I know of that does not have variable pricing,"
Except for music/movie rentals and movie theater tickets. Are they going to start telling blockbuster that each rental CD should be individually priced?
We want to share in those revenue streams
I'm sorry but how is that not greedy?
And as a consumer I think $.99 for every song is MUCH better than a variable pricing scheme. I can buy any song knowing it's only going to cost me a buck and don't have to worry about that random $3 song that I otherwise would not have bought.
Erik http://yakko.cs.wmich.edu/~rattles
"and I dare say not appropriate to consumers" ????
If this guy thinks that songs should be sold for more than $0.99, then he should go ahead and do so. I mean, really, go ahead and start selling songs for more than that and see how that works out. He is perfectly free to set up his own online music store, and because of the extreme flexibility of the technology involved, this will just involve getting the files on to your portable music player from a URL instead of from the iTunes application.
Once he has done this he can set the songs in his music store to cost $1.99 or $5.00 or $53.00 or absolutely whatever price he likes, and if people choose to buy it then all of that money will go right to him. While of course meanwhile the iTunes Music Store will still be back there offering quality music at $0.99 a song.
Then the market will decide for itself. That's what he says he wants, right?
Irritable, left-wing and possibly humorous bumper stickers and t-shirts
I wonder what this "music mogul" thinks of compulsory licensing and statutory license fees (http://www.soundexchange.com/rates.html) and Harry Fox and the averaged/staticstical licensing model employed by ASCAP and (afaik) BMI, and 1000 other circumstances in which averaged pricing for content is used.
$0.99 per song is an average price, and comprehends both Top 40 and Bottom 100,000. The music industry simply wants to get this average price in addition to a premium on the Top 40 stuff that's already rolled into the average. If they want to re-negotiate the average price, that would be "reasonable" (in music industry terms, anyway), but this is blatant double-dipping.
Jobs is right: they're being greedy.
Our comrades buy from allofmp3.com; where music is priced by the pound in Ogg.
I think the music industry's problem is that the market has decided, and it's decided it doesn't like the music industry's standard terms. The music industry doesn't like that decision and is trying everything they can including whining like a spoiled brat to get it changed. Unfortunately for them, the market isn't buying it (in several senses).
He's overqualified. ;)
"Some songs should be $0.99 and some songs should be more."
He forgot "and some songs should be less". That is, if he really wants to let the market decide.
Jobs was right, the industry is greedy.
-Charles
Learning HOW to think is more important than learning WHAT to think.
The music industry is largely superfluous at this point, but unfortunately they haven't realized that yet. Unfortunately, they won't go down without a fight, and since they have made such an obscene amount of money over the years, they have the cash reserves to wage quite a war.
Vote with your dollars, go see live music. Go see that local band that has been playing at the corner bar for years. Find someone who seeks out music outside the mainstream and have them make you a mix. There is so much more out there than reaches the top 100. As digital distribution expands we will have more access to what we want, not what we are being force fed. Turn off MTV, it is the industry.
'The words of the prophet are written on studio walls'
Didn't the market already decide digital music should be free?
Just sayin...
So what if the music industry folds? Does that mean no one will ever sing a song again? Will the world be silenced forever? Will Beethoven, Mozart, et al roll over in their graves because there is no more music industry? I would like for people like Bronfman to explain in very detailed terms what value they bring in the 21st century to the music making process? My guess it is a very marginal addition.
I have over 5,000 cds and a couple thousand Lps. If there was never another CD produced, I still have enough music to last me a lifetime. Additionally, because of advances in computer tech, I can now produce my own music which I do for my own amusement. It may not appeal to anyone else but I get enormous satisfaction from doing it myself. Again, what do I need the music industry for?
I say let the music industry perish. Out of its ashes, a new phoenix will rise that will be a lot more interesting and compelling. Dollars will flow to those that embrace a modern paradigm.
Someone with a wicked sense of humor. If I could moderate the moderation as funny, I would. I've got the points too.
Sometimes boldness is in fashion. Sometimes only the brave will be bold.
Jobs: Record execs are greedy.
Record Exec: We are not greedy, we just want money for what we produce. And we need a cut of iPod sales.
Jobs: QED