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Apple iTunes to End Flat Fee Pricing?

Posted by Zonk on from the under-pressure-is-not-just-a-queen-song dept.

MdntToker writes "According the Forbes, EMI has an understanding with Apple that flat fee pricing will end within the next 12 months, and more popular songs will be priced higher than 99c, while lesser known acts will be priced lower than 99c." From the article: "Label executives have made multiple arguments for flexible pricing. They argue, for instance, that almost all retail businesses have different price points for different products. But they are particularly interested in boosting their revenue from digital music sales, which aided by the sale of mobile phone ringtones, are increasing but not quickly enough to replace the continuing drops in compact disc sales. EMI said today that digital sales, made up 4.9% of the company's sales in the last six months, up from 2.1% a year ago." We've previously reported on this story.

14 of 556 comments (clear)

  1. The "Flexible" Elevator - Going Up? by erick99 · · Score: 5, Insightful

    I take it that this will translate into the vast majority of what is downloaded being above ninety-nine cents; otherwise, I don't see why they would bother with "flexible pricing." I know this is cynical - but I suspect that this is intended to be flexible mostly in an upward direction . . .

    --
    http://www.busyweather.com/
    1. Re:The "Flexible" Elevator - Going Up? by interiot · · Score: 5, Insightful

      Not necessarily; profit is one of those microeconomics things that is a curve. If you're on the top half of the curve for a specific product, lowering the price of a product will increase profits because volume goes up faster than unit-profit goes down.

    2. Re:The "Flexible" Elevator - Going Up? by Golias · · Score: 5, Insightful

      The new digital model the GP was referring to is the band creating a website, hosting it, and charging $0.25 a song download (or even givign it away for free and make money selling merchandise or concert tickets). Therefore, the music store is obsolete (or can be used just for selling branded merchandise).

      Name three rock bands who were never signed by labels and make a living that way sufficient to quit their day jobs.

      Imagine if the music version of slashdot existed (it may already, I don't know). Bands could post links to their new releases, users can comment on the songs / bands, and the best bands will gain the largest following.

      Dozens of such sites exist. Hardly anybody goes to them. A few hard-core people do so they can pat themselves on the back for supporting indie bands, but most people fall in love with some fractin of the crap they hear on the radio. Even psuedo-indie acts like Death Cab for Cutie are in the position they are in only because a record label pimped them like crazy.

      If you will pardon me for briefly playing the Devil's Advocate...

      One could easilly make the case that the work done by a record label is more important to the financial success of a music act than the work done by the band itself. When you look at it in that light (and realize that the labels take the brunt of most of the financial risk), it really isn't so eeeevil that they take a bigger slice of the pie.

      I mean, David Gibbon just sat in front of a microphone and crooned for a few hours. Behind every album his band has made, there was an army of promotors, engineers, event planners, office staff, and several layers of management, all putting in 40-hour work weeks to make sure that you and as many of your friends as possible buy the album. They all worked just as hard as he did, and for considerably less money. Yet people consider it this horrible injustice when this ONE EMPLOYEE of the record company, who happened to have the most fun job of anybody involved, doesn't get to hog a majority of the profit for themselves.

      So yea, if you are a singer and think that's unfair, go out and try to do the work of all those people by yourself. You will probably end up with a much larger slice of a vastly smaller pie, unless you are just as good at music promotion as you are at being a musician.

      --

      Information wants to be anthropomorphized.

  2. End Result? by Shads · · Score: 5, Funny

    ... I go back to snail mailing money to the artists and downloading the mp3. Shrug.

    --
    Shadus
  3. So the model becomes ever more like... by w.p.richardson · · Score: 5, Insightful
    allofmp3.com?

    Only way more expensive...

    And encumbered with DRM...

    No thanks!

    --

    Curb CO2 emissions: Kill yourself today!

  4. Good news by generic-man · · Score: 5, Funny

    According to Slashdot, popular music sucks. As a result, non-sucky music will cost less than it does today. This is good.

    --
    For more information, click here.
  5. And so it begins.. by Anonymous Coward · · Score: 5, Interesting

    I wonder if 'flexible pricing' will allow them to adjust prices 'on the fly' - let's say 10,000 users download Song A priced 99c and software automatically then adjusts the price to say 1$ 29c or similar price.

    Then again, there is no end to corporate greed so I'm expecting to see this in action.

  6. Is this really a bad thing? by Ossifer · · Score: 5, Interesting

    Shouldn't B-sides actually be cheaper than the hits? New material more expensive than oldies? People have been justifiably complaining for years of having to buy whole albums just to get one or two songs they want, and now they don't have to.

  7. Guys, this is a strange story by daviddennis · · Score: 5, Insightful

    "Believes"?

    It's a story if you have someone say that he "knows" Mr Jobs will do something, or - better yet - if Mr Jobs actually says he's doing something.

    But if a record company executive says it, and he has a vested interest in having it happen, and perhaps almost a desperate need for it to happen, well, I don't think his word or judgement is necessarily good.

    Record company executives have, from what I've noticed, little reputation for integrity. Until I hear this from Mr Jobs' mouth, or a slick press release and video from Apple about its inevitability, I'm not going to believe it.

    D

  8. Just to make sure... by Spytap · · Score: 5, Insightful

    ...So the most easily pirated material (the popular stuff) is going to be more expensive, while the harder to find stuff (the less popular songs) will be cheaper? Either they're changing their business model more drastically than ever before in their history to expand the appeal of smaller artists...or they're just in it for the short run to prove that digital downloads don't work...

  9. Feedback is beneficial for all. by CyricZ · · Score: 5, Insightful

    It's important to complain, as that provides them with feedback on their decision. Everyone is better off if there is dialogue between the two parties.

    If enough people voice their opposition, then perhaps Apple will realize that it is not in their best interests to switch to such a scheme. Thus everyone is potentially better off if Apple listens and responds accordingly. Customers can then continue to purchase the songs they want, rather than to boycott. Apple can continue to receive revenue from such customers, rather than having the customers go elsewhere.

    Notice that the same thing happened recently with regards to Novell/SuSE and their switch from KDE to GNOME. They announced the switch, and many customers complained. The customers let them know that KDE was still wanted. And what did Novell do? They agreed to keep offering KDE.

    It's better to work out such problems before involving money.

    --
    Cyric Zndovzny at your service.
  10. Sounds good to me by mapmaker · · Score: 5, Insightful

    The world's 14 year olds can pay $2 for the latest 50 Cent "song", and I'll pay 50 cents for real music.

  11. The "Possible" Elevator - Going Nowhere? by danaris · · Score: 5, Insightful

    Yeah, but is anything really going to happen?

    From what TFA says, this is based on what one music industry exec thinks Steve Jobs might do. Now, if it was something the exec had heard that Jobs was going to do, that might be something.

    This looks to me like nothing more than wishful thinking. And Slashdot jumps in with a sensationalist headline proclaiming certitude, never one to let a little thing like reality (or sanity) get in the way of a nice flamewar...

    Dan Aris

    --
    Fun. Free. Online. RPG. BattleMaster.
  12. Why the heck doesn't Apple: by PortHaven · · Score: 5, Interesting

    1) Start signing bands on a 50/49 cent split. (OMG...can you imagine it, artists getting more money than the label for a change)

    2) File a lawsuit on behalf of the artists...that said artists only negotiated "analog" recording distribution rights. That none of the old contracts covered digital distribution. And that all of the artists retain the rights to their digital distribution, including the right to negotiate a digital distribution contract.

    (Think about it, a) the common people would support it as I would buy a lot more music at $0.99/song if I knew the artists actually benefited. b) think of how many artists would support such a move? big names too like "Paul McCartney"... As many artists were screwed over big time. Even big name artists saw very small percentages of their songs. This would allow Paul McCartney to regain ownership of his music (for digital distribution only). RIAA would still retain the analog rights (but we all know that's a dying medium). And with RIAA pushing so much legislation distinguishing the difference between Analog and Digital (DMCA) there may in deed be enough cause for a court to decide in Apple's favor especially if 90% of the artists and consumers are in favor of it as well.

    RIAA would find themselves the owner of an extinct business model. Left with a rotting carcass...

    - The Saj