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A win for Music Lovers, iTunes @ 99 Cents
4 May, 2006
In what can easily be termed as a win for the music lovers across the world, Apple Inc. has announced that it will continue selling single tracks at the same price it has been selling for last three years. To be able to do it, the company had to negotiate hard with major record companies, who were in the favor of differential pricing, unlike the uniform 99 Cents tab.
The contract renewals, coming after several months of sometimes contentious negotiations between the two camps, marks a defeat for the music companies -- Sony BMG, Universal, Warner Music, and EMI -- that wanted to institute a variable-price structure for the downloads.
Apple’s iTunes service, which is the clear leader in music sales with an estimated 80% market share, has been faced with complaints from the majors about its 99-cent pricing, which covers newly released music and back-catalog titles.
Apple’s CEO had called the record companies, "greedy" at one point of time last year during a press conference due to this difference of opinion on pricing. He is of the view, that differential pricing would only lead to illegal file sharing over p2p networks and things need to be kept simple and straight.
Overall online music sales has had a great last year, shooting up 193 percent in 2005, according to Nielsen Soundscan. Meanwhile, sales of physical albums fell 3.9 percent in that period. Digital downloads currently account for some 5 percent of revenue for the major music companies.
The term of the new contract has not been revealed, but it is expected to be a short term arrangement by the time Apple’s competition catches up. MTV is working on "Urge" with Microsoft which might be released with the next version of Windows Media Player. Amazon is also working to get into digital music download arena in near future.
All in all, days are going to be better only for the music lovers.
Source: http://www.livepunjab.com/news/a_win_for_music_lovers_itunes_99_cents-22142.html
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