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Old 03-03-06, 03:18 PM   #1 (permalink)
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DOJ + Steve Jobs vs. Big Music

Do you DL music via iTunes or other pay service?
Is .99 or thereabout a fair price per track?
Did you give up pirating for a fair/cheap price download?
Or is this stuff crap, regardless of what price it is?


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Everyone's favourite sticky beaks, the U.S. Department of Justice, are at it again. The targets this time are the world's major music labels: EMI Group, Sony BMG, Universal Music Group and Warner Music Group.

According to sources familiar with the case and reported by Reuters, Sony BMG have already received a subpoena and the others on the hitlist have been told to expect special deliveries from the postman over the next week or so.

The New York State Attorney General, Eliot Spitzer, already has an investigation underway which is similar to this new action by the DoJ. Spitzer has already subpoenaed Warner Music Group in connection to antitrust investigations into the pricing of digital music downloads.

It seems while the world + dog is perfectly happy with Apple's 99-cents pricing policy, as evidenced by the recent sale of the one billionth track on iTunes, some music labels want to introduce variable pricing: relatively unknown bands would clearly be cheaper, while 'premium' artists would command higher prices.

That suggestion did not sit well with Steve Jobs. As we reported back in September, Jobs made it clear that any attempt by the recording industry to raise prices would be met with resistance. "If they want to raise prices it just means they're getting a little greedy," he said. "Customers think the price is really good where it is. We're trying to compete with piracy. We're trying to pull people away from piracy and say, 'You can buy these songs legally for a fair price.' But if the price goes up a lot, they'll go back to piracy. Then everybody loses."

Consumers have voted with their wallets for years. Music moguls wondered why sales of singles and albums decreased in recent times, yet conveniently ignored their own high pricing and manufactured pop garbage and instead blamed internet piracy. Now that buying music online using legal channels is both fast and relatively cheap, demand has returned and thanks to the immense popularity of Apple's iPod, the market is growing at a rapid pace.

Chart music is just as bad as before, but at least those who want to listen to it on their iPods can do so with ease. We will certainly be watching both cases with great interest, as a judgement either way will surely affect the current status quo.
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Old 03-03-06, 03:28 PM   #2 (permalink)
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My view of the .99 download is that it is still overpriced. at .99 a complete album's worth is about 12.00-16.00. A typical big box store sells most albums in the 8.00-12.00 range.

The price isn't different there, but if you factor in shipping expenses, manufacturing, printing, packaging, storage, etc. The cost of physical media is far more expensive to produce than the electronic downloaded version. The profit going to the online vendor could be equivalent to the profit margin at the store.

This being the case, the music companies should be seeing much higher profit margins from the electronic versions, and considering that MP3 is still the most popular format, people aren't p2ping their itunes libraries. Which leads me to think that the physical media is still the preferred method of 'ripping' for pirating.

You'd think the recording industry would be promoting downloaded versions and making it even cheaper to make it a preferred method.
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Old 03-03-06, 04:01 PM   #3 (permalink)
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Every store I have seen sell the CD for one price, that is generally cheaper than buying all the tracks.
iTunes sells the CD for $9.99 and the songs for $.99 each.
You can't compare the price of the songs individually to the price of a CD in the store.
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Old 03-04-06, 07:59 AM   #4 (permalink)
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Think about this, If you want one song from a artist and not all the others you buy the song you want instead of buying a whole cd. Compare .99 to $12 which one is better? ?Or if you want a cd you buy one for 10 bucks which is still cheaper.
-Justin
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