Universal, world's largest music company, refuses to renew iTunes contract

Looks like a pillar of iTunes content might be on the brink of collapse -- Universal Music, the world's largest music business, has officially opted not to renew its contract with Apple for vending music on the iTunes Music Store. We don't know specifically what caused Universal to turn away -- perhaps it's the weight of the rising anti-DRM movement among consumers, or perhaps it's because of Stevie J.'s brash negotiating tactics, continual refusal to hand over iPod cash, or oceanic persistence in keeping tracks locked in at $0.99. Whatever the reason, we can't say we're all that surprised; Universal's been a pain in Apple's ass for years now. So what's the end result? Well, Universal music will still be sold through iTunes at will, so that means consumers can keep buying tracks for the time being, but Apple runs the risk of losing Universal's content on very short notice if the companies don't make happy with one another and put pen to paper once more.

[Thanks to everyone who sent this in]

[Zadillo @ Jul 2nd 2007 12:49AM]

I think the "risk" is on Universal's part; the industry knows CD sales are down, and digital sales are up, and the iTunes Store is one of the most popular destinations for selling music digitally. At this point, Universal would be suicidal to cut off potential digital sales.

And Apple would let Universal walk before they let them charge $2 a track or whatever ridiculous thing they want.

And Universal can explain to their hot acts when contracts come up for renewal why their music isn't available for sale on one of the most popular digital music stores..... and they can also try and explain that to any hot rising new acts they try to sign.

[Fatima @ Jul 2nd 2007 1:03AM]

haha you have a Zune. *point and laugh*
Well you can still download songs via iTunes Plus and put em on your Zune.

[Fatima @ Jul 2nd 2007 1:05AM]

opps, wrong comment reply my bad..it was ment for the user blow this comment.

[Zadillo @ Jul 2nd 2007 7:57AM]

Well, you've certainly convinced me Charles!

[Chuckles McGee @ Jul 2nd 2007 9:45AM]

Completely agree. An iTunes without Universal is a little shaky, Universal Music without iTunes just falls flat on its arse.

[DC @ Jul 2nd 2007 12:50AM]

That sucks for itunes users. i just use limewire ;)

[Bob @ Jul 2nd 2007 12:54AM]

So you steal music? Bragging about being a thief is not as cool as you might think.

[DC @ Jul 2nd 2007 12:55AM]

I'm cool wit it. maybe ill stop when drm is dropped.

[michas_pi @ Jul 2nd 2007 1:01AM]

iTunes Plus?

[Fatima @ Jul 2nd 2007 1:01AM]

uh, Some of the music on iTunes does not have DRM...hello where have you been?
Music from coldplay, Red Jumpsuit apparatus..etc does not have DRM and they are 256kbps. All EMI music is now DRM free. Steve Jobs said he hates DRM and going to try to get more studios onboard.

[DC @ Jul 2nd 2007 1:02AM]

I dont hve an ipod. i hve a zune- ipods r too overhyped. nothin special bout em

[Fatima @ Jul 2nd 2007 1:07AM]

haha you have a Zune. *point and laugh*
Well you can still download songs via iTunes Plus and put em on your Zune.

[Ryan @ Jul 2nd 2007 4:36PM]

think diffrent and think about buying a zune, my best purchase ever

[NightShade15 @ Jul 2nd 2007 2:24AM]

@Fatima
Zunes are made of PURE WIN.
I'm sorry that you fail to see, my dad has a Zune (I just use my psp's 4gb card, I don't listen to a whole lotta music) and He has ~790mbs left and 6,500 LEGAL songs (Half CDs half from the Zune Market place) He has I think 5 full length movies on it as well, and quite a bit of cartoons/short vids etc.
IMO the difference between The Zune and iPod is: Zune has a bigger screen, has Radio (Which I would use actually, good radio stations in the Seattle Region) and iPod has... *looks at my sisters iPod* well... no real advantage when comparing the 30gb iPod video to the Zune...

[CarbonFree @ Jul 2nd 2007 1:23PM]

@NightShade15:
Only problems with the Zune: it does half of what you expect (WiFi only so much so to the half-assed sharing), and the screen may be larger, but it's still the same resolution. Oooh, larger pixels.

[MacGuru @ Aug 13th 2007 10:01AM]

... which is where all the Universal music will end up if they ditch iTunes. Serves them right.

[BrettB @ Jul 2nd 2007 12:52AM]

What a waste. They've gone from a U2 special edition iPod to this. Universal, stop being greedy. You will sell through any brick and mortar shop in the world. Don't be idiots and refuse to sell through the world's most popular online shop. I know, I know, you haven't actually stopped selling on iTunes yet, but if you do, it will be a dumb move. Really, I thought the music labels had learned their lesson. Pirates, start your engines...again.

[ethana2 @ Jul 2nd 2007 2:59AM]

Engine started. I'd love to watch them shoot themselves in the foot. I think it'd be hilarious. But, like, people are saying, they're not that dumb.

That being said, I'd like to see the creative commons license eliminate our dependence on these people- like the gnu has basically eliminated my dependence on proprietary software. We live in a new age now, where information is not a good, but a service. All the companies who don't realize that are going to get royally screwed over the next 10 years. 'course, I think it'll be kinda funny to see that happen too... but that may just be me.

[PJay @ Jul 2nd 2007 1:49PM]

Please, my Archos 604WiFi will wipe the floor with both of them! The only thing they have over Archos is throwing money into marketing. And Archos is starting to show up in more stores and locations without all the Apple/Microsoft hype and smoke and mirrors. Touchscreen, real WiFi connectivity, DVR ability, and etc...

[Kyle Kennedy @ Jul 2nd 2007 12:56AM]

I am freaking glad they're doing this.

a. Poke a hole in Apples wallet.
b. Slap to Apple's face.
c. No more "go download this episode of Battlestar Galactica on itunes" bullshit

[michas_pi @ Jul 2nd 2007 1:00AM]

You're jealous that a company legally makes money for providing products that cater to a wide audience? That's pretty shallow thinking.

[Fatima @ Jul 2nd 2007 1:02AM]

Leave him alone, he needs something to rant about after regretfully buying a Zune.

[Kyle Kennedy @ Jul 2nd 2007 2:25AM]

Myeh - I'll stick with my laptop and buying CDs.

[Zadillo @ Jul 2nd 2007 1:07AM]

Apple doesn't really make much money/profit from selling music on the iTunes Store; its not going to particularly poke a hole in the wallet of Apple. The only thing that would do that would be if people chose to give up their iPods/etc. in favor of wherever else they might buy Universal music online from (of course, if they buy Universal music CDs, they don't particularly need to give up their iPods).

[michas_pi @ Jul 2nd 2007 1:08AM]

Oh snap. That reminds me of a previous Engadget comment on the "iPod Amnesty Bin": "Where is the Zune Amnesty Bin? Oh, that's right, it's the store shelves."

[Fatima @ Jul 2nd 2007 12:58AM]

Down with Universal! First they back HD-DVD and unnecessarily prolong the HD war. If they join BD, this silly war would be over right then and there. Then they bully blockbuster and threatened to remove their movies from the store...blockbuster said "meh"..Universal blinked and they didn't remove the movies.

And now this? WTF i bet MS is trying is paying them royalty to secure Zune exclusivity, which is BS just like MS did it to HD-DVD.

Someone should fire CEO of Universal, he is a total nut and going to drive the company into the ground.

[kompressor @ Jul 2nd 2007 1:33AM]

Wait, how did MS get involved in this? Oh right, I forgot that it's popular to accuse MS of bad things based on speculation. And I meant to write M$. Where are my manners.

[Fatima @ Jul 2nd 2007 1:35AM]

This just smells MS, just like they paid rockstar $50million for GTA 4 360 download content exclusivity.

[michael @ Jul 2nd 2007 1:42AM]

I just want to point out that anyone in the HD-DVD camp is not bad. There's reasons why some people might join the HD-DVD side, and the BluRay side. Some people like the fact that HD-DVD has more interactive features and is generally cheaper. Others like that the BluRay can store up more, and 'seems' more higher quality than HD-DVD. So who's to say that BluRay should have won? It's not anyone's fault. It's just a companies opinion on which is better. Plus the fact that downloading HD content is the future, it's not that important.

I don't know about Microsoft paying Universal for exclusive ties, but I don't think they would actually go through such a dumb thing. Their Zune is still to new, and if they made a mistake and try to buddy up with Universal (the most biggest, but yet no-so-nice record company), then there's going to tons of people hating the Zune for that. So I'm thinking that they would probably back onto a more better option. Plus, Engadget reported that they might ink a deal with EMI to have DRM less content on ZuneM too.

[Trace The Hedgehog @ Jul 2nd 2007 6:02PM]

Hey, if MS has the money, why not?

[booyaka @ Jul 2nd 2007 1:00AM]

Zune market place is $15 for unlimited music. iTunes is $1 per song. iTunes deserves to go into a shithole.

[Zadillo @ Jul 2nd 2007 1:03AM]

You do realize that the Zune marketplace also sells songs (for the exact same price, Marketplace Points aside)? What iTunes doesn't do is music subscriptions; that is certainly something that can be debated (and there's plenty of subscription music services out there for those that prefer that).

[booyaka @ Jul 2nd 2007 1:08AM]

If you choose to buy the song without a subscption then yes, the charge is $1. But i've already downloaded nearly 50 full CDs and all i had to pay was $15 where in iTunes i would have spent well over hundreds of dollars.

[David Patino @ Jul 2nd 2007 1:14AM]

I prefer the purchase based model.

Example, I don't normally download more than $15 songs a month
So lets say I download only one cd a month, $10 before tax at itunes.
I pay the $10, and that's it. The songs are mine, and I can listen to them for ever.
The same thing via a subscription at live market place would be $15 for the first month, and $15 for every month after that in which I want to continue listening to that music.

For some people subscription makes sense, for others purchasing does. I'd like to have the option in itunes, but just because of the lack of that option, doesn't mean I'm going to quit using them.

Personally I'd prefer to buy music tracks DIRECTLY from an artist, ensuring a bigger percentage of profit to them, and more likely hood of their staying in the business and making more music. :)

[MrWhite @ Jul 2nd 2007 1:48AM]

"Charging you $1 per song when Zune Market Place charges you $15 for UNLIMITED MUSIC? iTunes=rip off"

:| You dont' own the music dip s**t! Close your account and see what happens. Monthly fee for music is the dumbest idea on the planet, thus the reason why iTunes is the number 3 music seller either online or actual store. Because "NO ONE" but retards rent music.

[Erik @ Jul 2nd 2007 3:05AM]

The renting scheme is in no way inherently good or bad. If only retards do it (as Mr. White said), then why do people rent movies from Netflix or lease a vehicle? They're paying, but they don't get anything in the end...

It's all a matter of perspective.

[steveo @ Jul 2nd 2007 5:40AM]

MrWhite - you are an ass and a dolt.

Using your logic, everyone who pays for cable television instead of buying DVD sets is also a "retard" because they don't own anything at the end.

Information of ALL kinds is moving towards the subscription-based model because it makes more economical sense. Software is in the midst of the transition, as you can see in CRM segment.

There are those who perfer to lease cars and those who perfer to own, and either choice makes sense in certain circumstances for certain people. Don't be such a curmudgeon.

[steps off soapbox...]

[Peter @ Jul 2nd 2007 10:05AM]

Priceless is the people who think $200/year forever is cheaper than $1/song. The longer they stay in this scheme the more trapped they are, what do they do when it become $20/month, $30/month and all their music is dependent on monthly fees they have no control over and can't switch to a new provider without starting over...

Morons.

[John Miller @ Jul 2nd 2007 10:46AM]

Every time I go into a CD store I feel sorry for the people who have to buy music based on how the cover looks or how they liked the 30-second snippet they heard online or whatever reputation the band has.

Subscription services are like having complete music freedom. Try out whole songs, download as much as you like AND FIND NEW MUSIC LIKE YOU NEVER COULD BEFORE. If you like music you'll download way more than 15 songs a month. In May my work kept me until 9:00-10:00 every night and almost every Saturday. Nevertheless I downloaded 496 songs! And this coming from a guy who owned less than 100 CD's before he got a subscription service.

What if I cancel?", you say. I'm more likely to take cold showers than I am to cancel Urge.

[Mike @ Jul 5th 2007 5:26PM]

.. and if you stop paying $15/month, all your songs go bye-bye! What a deal!

[booyaka @ Jul 2nd 2007 1:02AM]

Charging you $1 per song when Zune Market Place charges you $15 for UNLIMITED MUSIC? iTunes=rip off

[Zadillo @ Jul 2nd 2007 1:06AM]

Zune Marketplace charges the same $1 to purchase songs. What you're talking about is a subscription service, where you are renting the music, and it stops functioning the second you stop paying for it.

It's not better or worse, the subscription music services are a different option. If one buys more than $180 worth of music a year, than the subscription music plans do have some merit (although you then have to also factor in continuing to pay $180 in subsequent years for any music you've subscribed to).

Again, the Zune Marketplace charges the exact same amount to purchase music. Its kind of silly to say iTunes is a ripoff simply because it doesn't offer a subscription model.

[booyaka @ Jul 2nd 2007 1:09AM]

I guess you're right. But i just think a subscription is much better than actually paying a whole large amount at once. But that's just my opinion.

[Marcus @ Jul 2nd 2007 1:28AM]

I guess your right, but I don't want to rent music, I buy CDs

[Sanjin @ Jul 2nd 2007 1:37AM]

You actually have to pay $15 a month to listen to all those albums you downloaded under subscription. Even a year from now, or two? And, if you cancel subscription, they're gone. Now, that's a ripoff.

[John @ Jul 2nd 2007 2:15AM]

There's something too ethereal about music subscriptions. If a company goes out of business or you want to switch services, all of your songs are gone! It's essentially on-demand internet radio.

[MacGuru @ Aug 13th 2007 10:07AM]

iTunes a rip off? What about record stores charging $18 for a CD...
without DRM at that!

[michas_pi @ Jul 2nd 2007 1:02AM]

In before Universal launches its own online music/media store.

[aaron @ Jul 2nd 2007 1:09AM]

yeah i wouldn't be surprised at all is ms has something to do with this.... also in conjunction with the live marketplace which has had tons of specualation that universal movies/tv shows were coming to the video marketplace. and it might be a "larger" deal to cover the zune as well. also would make sense for a "v2 zune" which alot of people think will hit before the year is out.

[booyaka @ Jul 2nd 2007 1:15AM]

Yea just like how they payed Rockstar millions of dollars just so they can bring epesodic content on the Xbox360 and not the PS3. Microsoft can be a little desperate sometimes but it's all part of the business game.