Tuesday, September 20, 2005

Apple CEO Calls Music Industry "Greedy"

Today, just before the Mac Expo being held in Paris, Apple CEO Steve Jobs was asked by reporters to comment on rumors regarding potential price increases on Apple's market-dominating music download service, iTunes. For months, people have been spinning the idea that Apple would eventually cave into demands from music industry executives to raise prices on music on iTunes. However, after a statement made today, Jobs has put those rumors to rest.

"If they (music industry) want to raise prices, it just means that they are getting a little greedy."

Apple has long been positioning itself to compete with the still-active illegal music downloading scene, and has marketed iTunes as the cheap, fast, legal, and easy-to-use alternative to downloading music off of Kazaa or eDonkey. If Apple ever raised prices or introduced a tier-ing structure for music sales (where the latest performers' work would be more expensive than older work), then the legal downloading scene would immediately cave-in on itself, and the music industry would be to blame, once again, for its own downfall.

Kudos to Apple for sticking to its guns and bitch-slapping the music industry into simply, "shutting the fuck up."

Here's a small article from MSN Money regarding Jobs' comments.


Blogger Robert said...

There would be a lot of pressure on them from the competition (Dell, Walmart, MSN, Napster, etc) to keep the song price at $0.99 . It is pure greed. Once a song is published into electronic format, there is no cost other than storage of the original file and transfer costs (minimal). I believe a CD used to cost the record industry about $1.50 each after all costs were figured in.

11:56 AM  
Blogger Robert said...

I just read that iTunes accounts for 82% of all online music purchases.

4:36 PM  
Blogger Robert said...

After thinking about it, I'm wondering if it is bunk. Why would the music industry ask iTunes to bump up the price? That would only benefit Apple. All the music industry has to do is charge Apple more for each song streamed. I think Apple's setting us up and seeking to blame it on the "greedy" record companies.

6:15 PM  
Blogger djkibblesnbits said...

It's not in Apple's interest to raise prices. If prices are raised, it's not because Apple is trying to make more money. Apple only makes 3 cents for every song purchased on iTunes. The rest of that money is going to the recording industry, the artists, and Akamai, the people providing Apple with the pipes to provide the musical content. Remember, Apple is trying to sell iPods, not iTunes music, so Apple would gladly take 3 cents per song if it meant more iPod sales. By raising prices, or introducing a "pricing structure" like many recording companies want to introduce, Apple argues that the differences in prices will drive customers away to illegal downloading, which studies show is an entirely sound claim.

So, it's definitely all about the recording industry, and not Apple.

2:03 PM  
Blogger Robert said...

My point is that if the music industry wanted a different price structure, they would just do it. They don't need Apple's permission. They are the ones that hold the rights. They get to demand the price.

So how does Walmart do it? They sell $0.11/song cheaper than iTunes. Why can't Apple demand the same bottom-line price that Walmart gets?

I know I sound anti-Apple but I've seen price gouging from them before. In the early '90s they cut the price of their computers in half to compete with PCs.

10:04 PM  

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