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Jobs to Labels- Lose the DRM & We'll Talk Price
eldavojohn writes "Apple CEO Steve Jobs has been talking smack about DRM and has recently issued a verbal offer to major music lables stating that if they are willing to lose the DRM, he'd be willing to raise his 99 cent price for those iTunes songs. These tracks (such as the recent EMI deal) would also have better sound quality & cost about 30 cents more."
...Except albums are still $9.99 without DRM and at the higher bitrate.
Lalala
If you buy the whole album, even if it has 20 tracks, it's $9.99. Please do a little research before spreading this FUD.
The "30%" only applies to song purchase. Album purchases haven't changed in price when buying 256kbps sans DRM.
You say: An album worth of tracks on iTunes cost more than a full price new release.
I say: Buy the album at the album price, not the tracks individually. Whether there are one track or twenty five on it, it will cost you less than the CD.
You say: iTunes will not let you mix and match an album worth of tracks for the price of an album.
I say: No one else will. Not Amazon. Not Best Buy. Nobody.
Oh, and by the way... if you already bought a couple tracks of an album and want to complete the album, iTunes will let you grab the rest of the album for the album price less the money you already paid toward the tracks you already have... even THOUGH as a portion of a full album the per track price is less than 99 cents, they're still letting you apply what you have paid thus far to an album price, rather than a prorated per-track album completion price. The same model will likely apply when the per track price is $1.30 and the album prices are still $9.99 even for the higher fidelity (as Apple has stated they plan to do).
Care to identify a single music retailer other than Apple who will do this?
The problem in your assumptions is that you think that the entire price of a product is associated only with the tangible materials that went into it. As if there are no other people to be paid other than those who work at the manufacturing plant, and as if there's no inherent market value to the INTANGIBLE content... (i.e. lyrics, music) in a musical work, and as if there are no costs to maintaining data centers with global load balancing that can serve millions of customers worldwide without crashing to a grinding halt.
Also, you're saying it starts to look worse and worse for individual singles. Do you remember when a single cost $1.49 to $3.49 just to buy it on a crappy analog cassette? I sure as hell do... and then you could only buy the singles that the studio released AS singles. You had no option of buying almost any track off an album, much less digital. It has only gotten better.
There is also a premium associated with the convenience of the iTunes model. Amazon will charge you shipping unless you want to wait an indefinite period for their SuperSaver shipping by which time you could have downloaded many times that amount of content from iTunes. Your time is worth money... how much? That's open to debate depending on the individual but I would imagine it's no fun to wait days on end just to get that one song you wanted... and when you do, Amazon won't let you have just that one song. It's got to be the entire album... one song you want, and a bunch you might not.
There is no direct analogy between what Amazon offers in terms of product and service, versus what Apple offers. And you are overlooking a very important competitive edge here because the ability to mix and match whatever tracks you want at a fair market price is one of the key attributes that makes iTunes so much more convenient and consequently hugely popular and still increasing in popularity.
The Apple business model can command a premium for the non-DRM tracks because of the limited alternatives to having their a-la carte purchasing options and the convenience of their user interface, search capabilities and purchasing system.