Hot on the heels of the
almost-ran reconciliation between Apple and the Universal Music Group, the music label has issued a statement saying definitively that it will not renew its long-term agreement with the Cupertino juggernaut. All this news comes at the tail-end of an extended negotiation period fraught with
leaked info and damage control (mostly from Apple's end of the table). The new arrangement will enable Universal to deal with iTunes sales "at will," thus allowing them to market music freely to other retailers, as well as offer exclusive arrangements with whomever the company chooses. It can be assumed that Apple honchos are not very stoked by this turn of events, considering Universal is responsible for one out of every three records released globally, and this will only increase their ability to control online distribution. Can't be fun to be the Jobs-man today.
[Via
iLounge]
posted July 5th 2007 11:36AM
Universal Music Group and NBC Universal are two differernt companies. UMG is even in the Blu-ray camp.
Now what's Universal's take on this story, I wonder:
"Yup, Apple sucks all the money and we get no profit."
Apple's take:
"OMG YOU IS USING OUR CD LOGO!!!! I'M GOING TO SUE YOU FOR MILLIONS!!!!! HA LOL WTF"
Bad timing for Universal. The specter of smarmy music moguls does not impress versus a man (Jobs) who's riding high with good designs. Who cares about, or for, Universal....
I still think Apple holds most of the cards...
http://www.last100.com/2007/07/02/why-apple-doesnt-need-universal-music/
They make money through hardware (iPods) not content.
Geez chill out and stop complaining… you cant blame Universal for trying to maximize there profits by trying to renegotiate their contract with APPLE. And why would a record company want a cut of the sales of a player thats built to play there property. HELLO ITS CALLED BUSINESS… AND UD BE STUPID IF U THINK APPLE CREATED ITUNES TO OFFER MUSIC for profit. They created it to cover the fact that there the most popular MP3 player thats built to play 1000s of mp3s. it was smart to make friends with the record company and offer music to also help push their player. I know Jobsy doesn’t expect me to fill that thing up with .99cent tunes. Yeah iam gonna spend $300 bucks and then fill it up with THOUSANDS of dollars worth of music. Id love to see what the percentage of music on a given ipod is bought from ITUNES… iam just ranting now its end of month and ive got financials to work on….
Apple is in the better place here:
1) If I were apple I drop all the Universal music inmediately and see what artists do.
2) Sign and promote those unsigned bands that usually play good music but do not have money for self promotion.
3) Even load the new ipod with all of those unsigned bands.
4) Start a new section in itunes about young hollywood producers that want to put their shorts in front of the public.
5) But stakes in Warner Music
With these things done correctly Universal is not needed in itunes, artists will rush to sign with apple... just like in japan.
Apple isn't allowed to buy stakes in any record company as part of the agreement with Apple Records.
Apple is in the better place here:
1) If I were apple I drop all the Universal music inmediately and see what artists do.
2) Sign and promote those unsigned bands that usually play good music but do not have money for self promotion.
3) Even load the new ipod with all of those unsigned bands.
4) Start a new section in itunes about young hollywood producers that want to put their shorts in front of the public.
5) But stakes in Warner Music
With these things done correctly Universal is not needed in itunes, artists will rush to sign with apple... just like in japan.
I bet Universal was demanding a slice of the per-portable pie, along the lines of the pirate tax that Microsoft paid. And probably something on a sliding scale built off profit-margin or capacity.
Universal can go exclusive with Microsoft if it wants, but their bottom line will evaporate.
IMO Apple should announce that they're dropping DRM altogether, that all new contracts will be for DRM-free music only and then advertise the hell out of how consumer-unfriendly DRM is.
Most iPod owners aren't buying music online.
At this point the iPod doesn't need a huge library on iTunes.
@ Roc
" Most iPod owners aren't buying music online.
At this point the iPod doesn't need a huge library on iTunes."
Uhhhh, then how did they move into 3rd place in june with music sales behind best buy and walmart and outpacing Amazon?
http://www.techspot.com/news/25830-iTunes-number-3-in-US-for-music-sales.html
Must be those couple of modded brown Zunes doing all the damage. : )
Back to the thread..., Don't renew with universal..., let them sink or swim.
Both will be hurt, but Apple has a bigger war chest...., uhhhh and meaner lawyers...., Do I see a cage match coming on?
...so this either means increased competition or Universal Music is destroying itself... I'm cool with either.
Good Riddance to bad rubbish.
Did Universal not read the latest sound scan numbers? Album sales down 15% digital music sales up 49% over last year...and who ,pray tell, does Universal think the majority of those purchases come from?
These idiots seem to think a large majority of ipod owners are going to chuck their ipods for Zune's or buy CD's to get Universal content. When in actuality those folks will probably go back to burning it just to put on their ipods.
If I was Apple I wouldn't bat an eye, I'd quietly begin working an easy way for artists to distribute their music directly through itunes.
"Macworld UK reports that in addition to variable pricing, Universal wants to be able to offer certain tracks and certain bands exclusively through other, competing online music services, in an effort to lessen Apple’s control of online music sales."
Variable pricing is cool! How about making music cost more on alternate Tuesdays, you know, unless the moon is full -- something like that? That's what consumers are BEGGING for -- MORE COMPLICATION. Buy three tracks for the price of four and get one track free!
And certain tracks through certain retailers -- hmm, how about you offer the EVEN-numbered tracks on iTunes, and the ODD-numbered tracks in the Zune Marketplace! That way people will have to buy BOTH! You can even put some special "hidden bonus tracks" in the Sony Connect store, then people will have to buy memory sticks too!
Unless, of course, it's an alternate Tuesday.
Um...iTunes already gets oodles of "iTunes" exclusives that aren't even released to hard media like in-store albums. Universal is just trying to say "we want the right to do this with other stores." God forbid someone say Apple's business practice isn't good for their business.
Sorry, Miguel, I'm not seeing Universal as a victim here. I seriously doubt that significant percentage of Universal's revenue stream is "iTunes Exclusives" -- but if you have supporting facts, please post references.
And what about the pricing? Universal's "freedom" to charge MORE MONEY for popular tracks is not a win for the consumer.
Universal is trying to answer question: Is iTunes the third largest music retailer because of the content offered or because of the customer base?
They could release something as an exclusive download on some other service, and everyone will then know the real power of iTunes. Either the non-iTunes exclusive sells well, and Universal can go ahead and release more content elsewhere. Or the the exclusive release sells poorly until its available on iTunes, demonstrating the power of iTunes. It was inevitable that a content provider would attempt to break th iTunes monopoly.
"All they know is, I was able to get my favorite artist, now I can't. Why? Oh, iTunes doesn't have it, lets see who does, oh, Zune Marketplace does, I will get it there. "
I dont think ANYONE would say that!!!! LOL! There are a ton of other cooler alternitives! O and the iPhone has already sold more then the zune!!!! AHHHHAHAHAHAHAH
This message has been brought to you by a random outbreak of fanboyness®
Sorry Im not normally like this...it just hit me and i couldnt resist the urge, here ill counter myself: LOL APPLE FANBOY NERD!!! WINDOWS HAS SOLD 100S OF MILLIONS MORE COPIES THE OS FREAKING X!!!!! LOL@APPLEFANBOY!!!!!!!!!!! See now everyones happy!
Sadly this means the consumer loses. I have resisted illegally downloading music and keeping myself clear of those pesky RIAA bottom feeders, buy using iTunes. I feel that $0.99 fair price for one song. I love the fact I don't have to buy the "filler" on every album that the record labels try to force down our throats. I don't want to subscribe to multiple music services and have to maintain multiple accounts, and folders. I don't see how this makes sense for Universal. Do they really want to say no to hundreds of millions of dollars in revenue? :shrug:
All this will do is make me buy less music and possibly fall into the dark side.
Let's remember that Apple created the digital music market -they worked hard, innovated, made great products and a great simple shopping experience....so let's be clear Apple are not the bad guys in this scenario...all they did was give people some great stuff...so they want a uniform pricing model - good that's fair and simple...honest...they even want DRM free - again fair and honest..
As per usual Apple led the way and now Universal thinks it can do the same and is probably gearing up to go it alone in the next 18 months with some second rate junk web shop based on a Microsoft DRM - probably even subscription. Nothing they'd like more than to own your music in perpetutiy for the rest of your natural born life....However, the Idiots might just manage to bankrupt themselves if they try that...
What won't stand is that the artists that universal hold back from iTunes will go ballistic when they have to sit and watch the artists on the universal free itunes go stellar...
All I can say is that this news is completely irrelevent. Until DRM is gone from all online music sales, WHO CARES!?!
Everyone is saying "oooh bad for Apple" but I don't see how this is good for Universal. They are wanting to remove their roster from the largest online retailer, and the 3rd largest retailer overall?
This is a mistake, and their artists will not stand for it.
This is all just posturing and maneuvering for the largest possible concession. If Apple is smart they will stick to their guns. There is no way Universal will go exclusive with someone else.
iTunes has reached the point where they control the largest nozzle for a great many music consumers. Cutting yourself off from that nozzle for an "exclusive" with a much smaller nozzle would be a profoundly bad business decision.
It would be like canceling your CD deals with Wal-Mart and Best Buy, and only selling through Sam Goody. (Or something, you get the idea).
I - for one - bought more than a few tracks from the iTunes store and if Universal want to stop selling to me than that is fine. I'll spend my money elsewhere, on the iTunes store, from people who appreciate my business...
(and seems like 87.5% in this room - in the Netherlands - of 32 people agree and will do the same...)
I rather pay a monthly subscription than pay $1 for a song I will no longer want in month!! I hate iTunes for that. who the hell will want to listen to a song that was sweet when it came out but now sucks? I also like that I can download a song I normally wouldn't listen to because I wouldn't want to waste $1 on that song. I have discovered so many new bands because I just download anything I can!
This can be potentially dangerous to apple, if ms took universals offer yet charged just cent less, some people would go for the more cost affective deal although its only a cent. Remember also universal have their nice logo on trailers and films.
meh. Screw Universal. If they won'tlet me buy their music the way i want to (iTunes Store at $0.99) then i won't be buying their music at all.
What exactly is the point of pulling out of the 3rd largest music retailer? So there can be even less legitimate ways to purchase their music? sounds like a fantastic way to try and fight the "pirating problem".
Does anybody who comments care to notice the fact that Universal is NOT pulling their media off of ITunes? I say smart on Universal's part. Now they are free to market exclusivity to the highest bidder. Even though it may not be a significant portion of their revenue putting themselves into position to possibly profit more is a no-brainer.
Think of it this way. When I first bought my cell phone, I signed a two year contract to get the phone I wanted. The cost of getting in the door was a "long-term" contract. When ITunes was just gaining popularity I'll bet universal did the same thing.
Now that my two year contract is up, and I'm happy where I'm at, I see no reason to sign another 2 year contract. I go month to month, if some better deal comes along, I'm able to take it, if not...oh well, I'm happy where I'm at. I'm sure Universal is thinking the same thing
I see no reason why they should sign a new agreement and limit their options when there seems to be no incentive to do so.
Better buy out all your Bon Jovi stuff now, or hope they split from Universal, this maybe either one less group of middle men or bye bye to alot of music.
iTunes store has frustrated me since I have made purchases that I cannot transfer seamlessly from one computer to another (home to work, etc.) and when my hard drive crashed at home, I restored my music only to find the songs would not play because I had used up my "limit" of computers that are allowed. No more...I suggest downloading from mp3stor, where the downloads are easy, you actually "own" the songs you buy, the quality and selection are better, and an album only costs about $2 - $3. And yes it is legal.
http://www.mp3stor.com/
All this iTunes mumbo jumbo makes me cringe.
ipod+itunes(buying music) = expensive
any other mp3 player + napster(leasing music) = cheap
I hate iTunes with a passion. Why pay for a song for 99 cents and come to hate it and want your money back! Opps, to bad, cant. Napster allows you to use the music on most non-ipod mp3 players and its only 15 dollars a month for unlimited downloads and plays!!! With itunes, you get 15 songs for 15 bucks and thats it! Ive downloaded, transfered and listened to freely on my PC and MP3 player over 4000 songs from Napsters service! If i did that on iTunes i would be in debt up to my ears for music!
I just do not like the fact that in order to use your ipod you HAVE to have itunes installed to put music on it. I do not think that is fair to the consumer at all. No wonder Apple is getting sued for the whole iPod+iTunes.
http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=9006985
http://www.macworld.co.uk/ipod-itunes/news/index.cfm?newsid=16818&pagtype=allchandate
I also hate how people think the ipod is so different from any other players, like the ZUNE, Creatives players and others. THEY ALL PLAY MUSIC! I cringe at the sound of 'iPod' when i hear it.
Steve Jobs is calling on the music labels to drop DRM copyright controls and sell unprotected music online.
In a rare open letter posted to Apple's site entitled Thoughts on Music, Jobs writes:
"Imagine a world where every online store sells DRM-free music encoded in open licensable formats. In such a world, any player can play music purchased from any store, and any store can sell music which is playable on all players. This is clearly the best alternative for consumers, and Apple would embrace it in a heartbeat. If the big four music companies would license Apple their music without the requirement that it be protected with a DRM, we would switch to selling only DRM-free music on our iTunes store."
He continues:
"Why would the big four music companies agree to let Apple and others distribute their music without using DRM systems to protect it? The simplest answer is because DRMs haven't worked, and may never work, to halt music piracy. Though the big four music companies require that all their music sold online be protected with DRMs, these same music companies continue to sell billions of CDs a year which contain completely unprotected music. That's right! No DRM system was ever developed for the CD, so all the music distributed on CDs can be easily uploaded to the Internet, then (illegally) downloaded and played on any computer or player."
The note seems to be partly in response to European governments' attempts to force Apple to open iTunes. Jobs says their efforts are should be targeted at the music labels.
"Much of the concern over DRM systems has arisen in European countries. Perhaps those unhappy with the current situation should redirect their energies towards persuading the music companies to sell their music DRM-free. For Europeans, two and a half of the big four music companies are located right in their backyard. The largest, Universal, is 100% owned by Vivendi, a French company. EMI is a British company, and Sony BMG is 50% owned by Bertelsmann, a German company. Convincing them to license their music to Apple and others DRM-free will create a truly interoperable music marketplace. Apple will embrace this wholeheartedly."
@Fivedollarones
Stop paying the $15 a month. You won't be able to play even 1 of the 4000 songs you downloaded from Napster. I'd rather pay the buck and own one song than rent thousands.
@Fivedollarones
Where did all of this DRM nonsense really start with music distribution? iTunes maybe? Nice to see Jobs creating the problem and becoming the savior to fix it.
Now there's some marketing for ya.
@ andrew
You dont understand, i listen to all of it. Why would i go into debt or spend 4000 dollars on music when i can pay 180 dollars a year and have access to all the new music when i want and listen and play what i want when i want. Its 192kbs, great reliable speed, no viruses like edonkey and that crap. Benifits outweight the small 15 dollars a month. I find more value in it that any other online music distributor.
Plus if you search a little, windows media DRM is crackable so i can still play it all even if i stopped paying...
@ Fivedollarones,
It's your prerogative if you prefer to rent music but don't think for a moment it's a less restrictive model than owing music. You have to keep paying the monthly dues and you can't move the music between players or burn to a disc.
The least restirctive setup is iTunes where Apple negotiated a way for consumers to LEGALLY burn their audio to discs and move between devices and alter encoding formats. Now with the higher bitrate DRM-free options it has become even better. Now before you jump on the "CD have no DRM and ca be burned blah blah blah" the RIAA specifically states that you are not allowed by law to convert your audio into a different format or move to a different medium such as an iPod. OF course, the RIAA can't do anythign about this but it does technically make iTunes the only legal method in the US for doing such conversions.
@ Evan,
Don't spread FUD. Apple didn't create DRM. DRM was on DVDs, Windows Media, Real Player, and even poorly devised for CDs. The standard for audio on Compact Discs was devised and set in stone by Sony and Phillips long before personal computing and the internet became household terms. Later attempts to regain control of the music industry failed with Sony's MiniDisc and ATRAC, and may others.
@ jeve Sobs
" Were Ron Popeil and Jobs separated at birth ?
I hope Universal puts the screws to the Jue and makes him give up more money."
Uhhhh, yeah...., it's called successful and rich, which they both are.
Well if you are going to throw a race card into your post, you should at least know how to spell it. It's spelled Jew..., not jue,
and by all accounts, Bronfman Jr., the head of universal music is the son of Edgar Miles Bronfman and the grandson of Samuel Bronfman, one of the most wealthy and influential Jewish families in Canada. (wp)
The people who buy most of Universals catalog are the same superficial (and lazy) people who buy iPods and use iTunes, so it makes me wonder what these people will do if Universal pulls out. Will they jump ship from iTunes for their somewhat catchy soul-less music, or will they stay for convenience and lack of knowledge of alternative digital distributors? Oh the questions.
So Apple just outright LIED once again just a couple days ago and said the Rumor was not true. Gezz, Apple may not be so Special after all. Lier's and copyright Stealer's. Of course we'll see Higher prices for Music which I though at .99 cents was ALREADY to much money. Really there's no CD, No Cover Art, Your not really saving any money, and in fact may end up spending more then just buying a CD. Plus now you have DRM garbage. WHY? It's such a RIP already. You know what it is though, they think they can make so much more money because of all the DUMB people that buy these $1.99 Cell phone Ring Tones and they aren't even a complete Song and of lower Quality. So if they can get that much for that garbage, they must at the very least get that much for a Normal Song track. That's their thinking on the matter.
I've Stopped buying Cd's quite a few years ago. I've gotten like 2 in the last 4 years. I used to buy quite a few I have 200-300 Cd's and I hardly use them now. I won't buy a IPOD or any other type of device like that. I'm not going to waste my money on .99 cents a song. That can get quite costly and DRM on top of it just blows, and I'm sure not going to pay even more money even if the DRM is removed. Nope, I've been a XM Radio Subscriber since as long as it's been around. The $12.95 a month is a Bargain. For the price of 1 CD or less, I can tune into all kinds of Music let alone all the other stuff also. It's great. Not having to fork out all this money for IPODS and TUNES, No having to manage Files, and play lists. Don't have to buy NEW Music, it's already being played. I hear a lot of old stuff, and stuff I would normally not know about but like that I would never hear on a IPOD because I didn't put it there.
If you want, you can get a Combo Satellite Portable Receiver and MP3 player to keep some of your Favorite tunes on to play whenever you want. I have my Skyfi 2. Plug it into the Home dock while I'm at home. It has a FM transmitter and my Shower Radio will pick it up. Plug it into my Truck and now I can tune it on the Go, and Plug it directly into my Boombox and Work also. I can no longer stand to tune into a FM Radio Station. It's just seems like all it is, is non-stop Commercials. I have my DVR's for TV, and have my XM Satellite Radio during the other times.
Apple didn't lie, the rumour was that Universal willnot be renewing their contract. Univesral did renew after all, but on a month-by-month basis.
Now Microsoft can start moving in for the kill.
In all honesty, I don't dislike Apple, but this clearly signifies that there'll be room for more BIG players behind the reigns than just Apple, and I like that.
After a couple months, I sold my iPod on eBay after removing my 100% of my non-iTunes purchased music. I wouldn't buy any tracks on iTunes and I won't be buying the iPhone. If Universal releases some hot CDs I'll be buying them and ripping to FLAC and playing on the PC via musikCube. CDs still outsell downloads. Lossless is the future. Apple and its fanboys are a bunch of biters.