Edgar Bronfman Jr calls Steve Jobs and Apple ‘unfair’ when it comes to pricing all songs at the same 99 cent level.
Some songs are more equal than others. Ask anyone who’s ever shelled out $17.99 or more for a CD containing a dozen songs, only to find one or two of them at all worth hearing. The long-time lucrative model for the recording industry saw piracy boom when the first version of Napster made sharing songs a cheap and simple way to get the best of an artist’s work.
The recording industry got Napster the First shutdown, but others sprung up to take its place. That’s when Apple stepped in and made the iPod media player and the iTunes Music Store available. Steve Jobs delivered what hordes of music lovers wanted: songs at a fair price.
That 99 cent price has become a serious point of contention for both Mr. Jobs and the music industry. Labels like Mr. Bronfman’s Warner Music receive no less than 70 cents per songs purchased from iTunes. It is likely the big labels receive more than that, but now it looks like it isn’t enough.
Red Herring reported on Mr. Bronfman’s comments at Communacopia in Manhattan last week, where he took issue with the one price fits all philosophy:
“There’s no content that I know of that does not have variable pricing,” said Mr. Bronfman at the Goldman Sachs Communacopia investor conference. “Not all songs are created equal-not all time periods are created equal. We want, and will insist upon having, variable pricing.”
Mr. Bronfman’s comments come in response to those made by Apple’s CEO, who delighted millions of music fans by publicly calling record labels “greedy.” Mr. Jobs contends that pushing a variable scale, where newer or in-demand songs price higher than 99 cents ($1.49 has been mentioned), will in turn push people back to song-trading.
Much has been made over song-swapping over the past few years. Studies have been lobbied back and forth; some state music trading is crushing the record industry, while other claim the industry is playing games with the numbers and song-swappers buy more music than non-traders by virtue of being more devoted music fans.
The labels won a partial victory in Japan when iTunes opened there. A dual pricing scheme has been in place, but that was not enough for Apple to bring Sony Music on board initially. The two sides have been in talks to try and make that happen, a difficult prospect since Sony sells music players that compete with the iPod, and Apple will not license the DRM scheme that would let iTunes songs play on Sony’s devices.
David Utter is a staff writer for Murdok covering technology and business. Email him here.
