Get Better Gear!

Premier Sponsors

Other World Computing

TechRestore

Top 5 Free Apps

Sheep Launcher Free!
Kronos Games
Release Date: August 05, 2009
Genre: Games
Boxed In
Dennis Mengelt
Release Date: May 22, 2009
Genre: Games
Ninjas Live
Storm8
Release Date: August 29, 2009
Genre: Games
Bump
Bump Technologies LLC
Release Date: March 27, 2009
Genre: Social Networking
Discovery Channel
Discovery Channel
Release Date: August 07, 2009
Genre: Entertainment

iTunes New Music Releases

Black Gives Way To Blue
Alice In Chains
Release Date: September 29, 2009
Genre: Rock
Backspacer
Pearl Jam
Release Date: September 20, 2009
Genre: Alternative
The Resistance
Muse
Release Date: September 15, 2009
Genre: Alternative
Awake (Deluxe Version)
Skillet
Release Date: August 25, 2009
Genre: Rock
Ellipse (Deluxe Version)
Imogen Heap
Release Date: August 25, 2009
Genre: Alternative

Top 5 Paid Apps

The Moron Test $0.99
DistinctDev
Release Date: April 22, 2009
Genre: Entertainment
StickWars $0.99
John E. Hartzog
Release Date: March 31, 2009
Genre: Games
Bloons $0.99
Digital Goldfish Ltd
Release Date: April 05, 2009
Genre: Games

Discover New Music

  • Guero

    • 10 out of 10
    • Beck

    • Beck is the modern master of the groove, and Guero is merely the latest example of this. From the opening power chords of "E-Pro," to the Pac-Man cuteness of "Girl," to the dirge-like lullab

  • Spilt Milk

    • 10 out of 10
    • Jellyfish
    • The second and final album from this power-pop group makes me wish Jellyfish had been able to make just one more record together. The album is best enjoyed as a whole piece, flowing from one track to

  • Supermodified

    • 10 out of 10
    • Amon Tobin
    • The genius is in the beats. Amon Tobin creates fantastic, groovy beats behind beats. "Supermodified" rolls through your expectations of breakbeat music, and turns them up a bit. It's a mellow album, p

  • Chicago Transit Authority

    • 10 out of 10
    • Chicago

    • For those of you who don't know, Chicago didn't always suck, and everyone in the band didn't always play a keyboard. When the band started off they were pioneers of rock and jazz fusion, and guita

  • Go Away White

    • 10 out of 10
    • Bauhaus

    • Go Away White is an album I've been waiting more than 20 years to hear, and the good news is that it was worth the wait.  The latest -- and last, no...for real this time -- album from

Reader Specials

Visit Deals On The Web for the best deals on all consumer electronics, iPods, and more!

News

iTunes Price Hikes Hurting Track Sales

Monday, April 13th, 2009 at 9:46 AM - by Jeff Gamet

The price hike to US$1.29 for certain tracks at the iTunes Store seems to have had an immediate effect: Many of the higher priced tracks aren't selling as well as they were before the increase.

After only two days with higher prices, Billboard noted that higher priced tracks were losing chart positions to $0.99 tracks.

Wednesday, the day after the price increase went into effect, songs priced at $1.29 lost an average of 5.3 places on the chart, and songs priced at $0.99 gained an average of 2.5 places. Seven of the songs priced at $1.29 had been $0.99 on Tuesday, and they lost an average of 1.9 chart positions.

Moving into Thursday, the trend continued with 53 $0.99 songs climbing on average 1.66 places on the chart, and 47 songs costing $1.29 losing two chart positions.

While two days worth of data doesn't necessarily indicate a trend, it does show that, at least for now, customers prefer the $0.99 per track price point. If the sales pattern continues, the resistance to $1.29 tracks could start impacting already dropping record label profits -- which is exactly what the labels don't want.

10 comments from the community.

You can post your own below.

Sir Harry Flashman said:

April 13th, 2009 at 10:01 AM

We have gotten quite used to paying $0.99 per track. I can understand a price increase for commodities such as food stuffs due to weather conditions, transportation cost and such. However, music tracks are not subject to such conditions, or only slightly influenced by bandwidth costs or other costs associated with selling them.

I don’t see the value in $1.29 most of the tracks. Of course my taste in music is a factor, I am not so much into Pop where I see most of the higher prices.

Sidebar: A few days ago I searched for an “Oldie” to see if it was available at $0.69, it was. However, they also had a re-recorded one at $0.99 that to my ears had better quality and that is the one I purchased.

   Quote

mactoid said:

April 13th, 2009 at 10:02 AM

WOW…a price/demand curve.  Who woulda thunk it?!?!?  Maybe the record labels need to consider hiring at least on econ major!

   Quote

OS11 said:

April 13th, 2009 at 10:07 AM

There are lots of angles on this, but perhaps $1.29 is simply too high and pushes the price point out of the comfort zone of many buyers. A better approach would have been to charge, .89 / .99 / 1.09 but a 30% premium for a “popular” song will just push people back to P2P for the free versions.

Another affect is now we won’t know what is truly popular and what is not. Inserting a monetary element into individual song pricing will skew the “hits” all over the place… so the greatest song ever may never be heard on a mass scale since it was priced “out of the market”.

My solution has always been find the actual “market price” of a song and stick to it. The record companies would be rich if each song was “10 cents” for example… since around that amount is the inflection point of where stealing music isn’t worth the “expense”, so money would flow to the record companies instead of P2P. oh well.

Lastly, I wonder if any of this would have happened if Steve wasn’t out of the picture? Hard to say, but it looks like the record companies are hastening their demise with such a huge price increase.

   Quote

vasic said:

April 13th, 2009 at 10:15 AM

Steve was the one who negotiated these prices. The deal was sealed last year and announced at MWSF in early January.

P2P companies aren’t getting any money from the illegal sharing of tracks. At this point, there aren’t even any companies; it’s all open-source peer-to-peer networking, without any one entity making profit (or even generating revenue) on that traffic.

In this whole tiered-price debate, many seem to imply that Apple caved in to the labels’ demands. We keep forgetting the biggest prize here: mobile downloads. Steve didn’t want to budge, while labels wanted desperately to withhold the privilege of negotiating separate deals with cellular carriers for selling music through phones (iTunes on iPhone), at $3 per track (like Verizon does). In the end, Steve got DRM-free and no limits on mobile iTunes, so in January, new iTunes for iPhone was announced, which now can downloads songs directly over the 3G/EDGE network, at same prices as on the desktop OS. Apple stood firm, labels caved.

   Quote

WaltFrench said:

April 13th, 2009 at 10:51 AM

Really? People buy fewer items if the price is higher? You mean just like Lexus vs Toyota or the French Laundry vs McDonalds or (need I ask) Macs vs Dells?

Assuming they don’t train people to use alternative ways of getting tracks, it’s in the companies’ interest to KEEP raising prices until volume drops enough that their total revenues decline. I certainly have no idea whether any given track will generate more total revenue at 99? or $1.29, but I’m sure they will keep tweaking prices to find the ever-changing sweet spot.

I think Apple has established their dominant position with the iPod and is less concerned about championing listeners’ price interest, versus availability of special bundles, video etc that taking the hardline “99? or nothing!” position may have locked them out of.

And some more context: somebody who buys a track every single day sees a price increase of $9/month. If the tunes matter that much to you, but you can’t afford an extra hour of a low-wage job extra to get it, it’s time to seriously consider therapy for addiction. There’s life outside the earbuds.

   Quote

vasic said:

April 13th, 2009 at 11:03 AM

Many of us seems to have got carried away with this uni-price fixation ($0.99, one-size-fits-all). There was a very strong argument for its existence in the first six years of iTunes Store. The argument went that in order to motivate ordinary people to buy music, rather than find shared tracks, only an extremely simple, straightforward system, with a single price point and a one-click buying process would stand a chance to succeed. Apple has over the six years successfully proven that. And now that large percentage of US population owns an iPod and is familiar with iTunes Store, the public is ready for a tiered (i.e. market-driven) pricing. Labels now get to decide how best to sell their content online. As for the consumer, we now have DRM-free files which can be downloaded via any possible networked device—mobile or otherwise.

   Quote

disappointed said:

April 13th, 2009 at 12:27 PM

I think many people, like myself, are just mad at Apple for making us pay more money to buy the exact same tracks we already have if we don’t want DRM.  I for one have stopped using iTunes completely (except for using those old tracks) and all my purchasing now will be done through www.amazonmp3.com.  Amazon led the way on no DRM and Apple followed in a way that just serves to piss off customers.

   Quote

vasic said:

April 13th, 2009 at 12:44 PM

Disappointed:

I think you got that wrong. When the DRM removal was announced, the press release also stated that users would be able to upgrade their existing DRM-protected tracks to DRM-free, 256Mbps versions by paying just the price difference ($0.30).

Make no mistake, though; Apple led the battle for DRM-free. Labels fought it tooth-and-nail, and were trying extremely hard to dislodge Apple from the top spot by offering DRM-free to Amazon and denying it to Apple.

Also, Apple’s AAC is far superior in quality from Amazon’s MP3. Since the prices are more-or-less the same, it is somewhat questionable why anyone would really want to buy from Amazon, now that you can put iTunes tracks on pretty much any portable device or phone.

   Quote

OS11 said:

April 13th, 2009 at 12:47 PM

@ disappointed

Apple doesn’t set pricing or control DRM, the recording companies do. Apple is just a distributor, they don’t own the content.

Actually, Apple has always been against DRM so it sounds like you have other issues not related to Apple or the music industry.

   Quote

James said:

April 13th, 2009 at 3:26 PM

@disappointed (one more)

You may have noticed Amazon’s prices are beginning to match Apple’s now. It’s already been pointed out that the labels control the DRM, not Apple or Amazon, and many believe (I think correctly) that the labels gave Amazon DRM free tracks first to leverage business away from iTunes which was rapidly overtaking all other venues for music purchases. This was all crass greedy nonsense on the part of the labels (and believe me, they know exactly what they’re doing and who they’re screwing), not brilliant strokes of genius by Amazon, Apple, or any other distributor. And yeah, AAC is better.

Just so you don’t think I’m biased, there’s no way I’m paying upwards of $12.00 for a 192 or 256 kbps downloaded album. For the moment, Amazon does have better prices than the iTunes store for a lot of things, get ‘em before their new pricing structure is fully implemented.

   Quote

Page 1 of 1 pages

Post Your Comments

  Remember Me  Forgot your password?

Not a member? Register now. You can post comments without logging in, but they'll show up as a "guest" post.

Commenting is not available in this section entry.