Wednesday, January 07, 2009

Apple & iTunes Sing Different Tune

Say it isn't so! After Steve Jobs for years said that it would never happen -- and after chiding other online music stores for lo those same years -- variable pricing is coming to your local iTunes store soon. Gone are the days of the much-vaunted simplicity of $.99 downloads. Now, iTunes tunes will come in three flavors -- $1.29 for some; $.99 for some others; and $.69 for the rest of the bunch (the discount bin, in other words). No doubt all of today's hottest tunes will be priced at the upper tier.

Look, I understand the business realities of Apple's new pricing plan -- announced yesterday by Steve Jobs' stand-in Phil Schiller at yesterday's MacWorld conference (Schiller has long been Jobs' right-hand man on the product side). The music labels have been battered; the popularity of digital downloads continues to be the one bright spot; and the labels, accordingly, negotiated a major pricing concession from Apple in order to serve up their tunes. Apple did get an important concession itself in return from the labels -- the ability to sell all of its tunes without anti-copying protection (i.e., DRM-free). This IS a boon for iTunes customers who can now use their purchased tracks on any digital music player or burn those tracks onto as many CDs as they wish (although most of the labels already made their tracks available DRM-free for online purchases in response to market and consumer realities).

But, uniform, "simple" pricing was one "line in the sand" that Jobs drew long ago to the ire of many. Uniform pricing also was used by Apple prominently in Apple's marketing as one significant way it distinguished itself from other digital music services -- frequently with a mocked tone ("look at the other guys, they just don't get it!" ... etc.). No doubt that the vast majority of the new "overage" amounts -- $.30 for the most popular tracks -- will flow directly to the content providers.

So, while one iTunes' hand giveth with DRM-free tracks, the other hand taketh away with variable pricing. Just read Apple's lips. It's really that simple ...

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