iTunes calling the shots...
Ron, IU


Apparently, in this weird and wonderful world of music-downlaods, the record labels are getting shafted. By a computer manufacturer. Wonder how they feel about that!

What seems to be happening is that Steve Jobs (Apple computers) has been under pressure to change the charging structure of iTunes so that labels can set a charge of more than 99c per downloaded track for new downlaods, reducing the cost of older tracks. Apple, basically, said "get stuffed". According to Steve Jobs, he's happy for them all to pull out of iTunes, knowing that - in business terms at least - the Big Boys would be the losers. Users of iTunes and iPod etc will still use the service so it is their own Artists , and themselves, that would be hit by the bullying tactics.

Personally, even though it makes little or no difference to grass roots development, I think it is still good for them to be putin their place, occasionally.

Apparently, some spokesman, on hearing the Apple position, stated "Where in life does the retailer set the price of the content?"

Erm... everywhere? Ultimately, the retailer can sell anything for any price they want (within the law, of course) and if the supplier cannot supply at those prices, and in such a way that the retailer can stay in business, then the retailer finds something else to sell. Otherwise, they're at the mercy of the supplier and no retailer wants that...

Here's what the New York Times had to say:
"April 20, 2006 -- The record industry may be on the verge of waving the white flag in front of Apple boss Steve Jobs, and abandoning its demand for iTunes to charge different prices for different songs, The Post has learned.
Negotiations between Apple and the four major music companies - with which iTunes deals all expire in the next two months - have reached a crucial point as several record executives now say they are unlikely to convince Jobs to allow variable pricing, sources said.

This marks a change of tune for the record industry as late last year several executives said they believed variable pricing - something the music companies have been pushing for - was imminent.

Universal, Warner Music, SonyBMG and EMI North America are all in various stages of renegotiating their deals.

The companies all charge different wholesale prices - roughly between 60 cents and 80 cents a track - but within each company the prices are the same. Now they have said they want variable pricing - the ability to charge less for some tracks and more for others - something Jobs has resisted because he wants to maintain the standard 99 cents-per-track retail price.

But Jobs has dug in his heels on the issue, creating the potential for a showdown between the mercurial Apple boss and the record industry should the labels continue to push for variable pricing.

Some executives even mentioned to The Post the possibility that some labels may end up pulling their music from the service, which is by far the most popular of the digital download services.

While sources say this is a remote possibility, the fact that it is even mentioned indicates the talks have been anything but amicable.

A more likely scenario is that the existing deals at some of the companies will expire and the two sides will operate without a deal as they seek to reach terms, sources said.

"That would be problematic for Apple because it allows labels on a whim to pull their stuff whenever they want," said one high-level music executive.

The debate has gotten acrimonious at times - with Warner boss Edgar Bronfman Jr. publicly bashing Apple last year saying, "only one price point is not fair to our artists." This prompted Jobs to respond by calling the record industry "greedy."

Still, at that time, some execs expressed publicly that they believed variable pricing was on the horizon.

David Munns head of EMI, in a published report in November, said, "I have no doubt we will see flexible pricing within the next few months."

One high-level music industry executive, who believes the record industry will ultimately abandon its push for variable pricing, blamed the labels for not standing up to Jobs.

"Where in life does the retailer set the price of the content?" said this person.