roni, lango- re music downloads
"Some leading music labels are in talks with online retailers to raise wholesale prices for digital music downloads, in an attempt to capitalise on burgeoning demand for legal online music.
The moves, which suggest that the labels want a bigger slice in the fledgling market's spoils..."
Ya know, I don't really think that money is the reason- at least not directly. The record companies seem to be in a bit of a panic at the idea of having a single dominant (re)seller of their wares. They'd love to have a bunch of little guys like Napster and Rhapsody and whatnot that they could dictate terms to or play one off against another. But right now they've got Apple...and the other 40, now 30, now 20% of sales split among all the rest. And none of these competitors are making any money.
The only company that has a viable business plan for online song sales at present is Apple, because they're making money off the player, and can afford to break even on the songs. The only way the record companies are going to ensure competition for Apple (and avoid a monopsony) is by raising the price of online songs to either allow a bigger margin that will keep the smaller online resellers from going under, or make a subscription model more attractive. For Apple, obviously, the incentives are all towards keeping the cheaper, low-margin prices. And as the iPod nears monopoly player status, the pressure is really building on the record companies.
I just hope Steve has either got an ironclad contract for the original price, or he has some other leverage to keep the 0.99 price...
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