VariablePricing
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Warner CEO: iTunes price increase led to lower sales, recession might also factor in
Don't pat yourself on the back too much for calling this one, but Warner CEO Edgar Bronfman Jr. has now confirmed what many have suspected: higher iTunes pricing has led to slightly slower sales. Specifically, he says that while the variable pricing introduced early last year has been a "net positive" for the company, revenue growth on iTunes slowed to just eight percent in the last quarter, compared to a hefty 20 percent a year earlier. He is also quick to point out, however, that raising prices 30 percent during a recession may not have been the best idea in hindsight. Interestingly, Bronfman seems to think that e-books actually stand a better chance at holding to up to price increases than music, noting that the "book publishing industry, on the iPad, has much more flexibility than the music industry had."
PSA: Advantageous auto-checks Amazon MP3 pricing from iTunes
So now that iTunes variable pricing is live, cross-shopping with Amazon is going to be a Thing -- and while we're certain slicker utilities will pop up soon, for right now we'd install Advantageous, which is just a little script that automates an Amazon search query from within iTunes. Yeah, it's not perfect -- it fails if you're logged in with iTunes store credit and it's far from bulletproof otherwise -- but it's a fine way to at least have kids or the less computer-savvy stop and check prices with at least one competitor before laying down an extra thirty cents on each purchase. This is has been a public service announcement... with guitars.[Thanks to everyone who sent this in]Read - Advantageous for WindowsRead - Advantageous for Mac
The price of popularity: "hottest" iTunes songs will cost $1.29 on April 7
Remember in 2007 when Apple started selling "iTunes Plus" tracks as DRM-free and 256 kbps AAC files? Much later you were able to upgrade your songs on a per-track basis, if you were so inclined. Well, get ready for more pricing changes. The LA Times reports a date has been set for the kickoff of the variable pricing model Apple announced at Macworld this year: April 7. While I doubt most people care about a slightly better listening experience (seriously, have you used an FM transmitter to play music in your car?), I think simply paying more because a song is popular won't go over so well. I'm not alone in thinking there will be backlash against the policy of selling more popular songs at a higher price. Jim Guerinot, who manages Nine Inch Nails, a pretty vocal opponent to the labels' stranglehold on the industry, feels the increase in prices will only ramp up piracy -- again. I'm inclined to agree. Yes, we knew this was coming. But the average consumer embraced the iTunes Store not only because it was Apple, or the iPod, or iTunes itself, but also because the one-price-fits-all model is easy to understand. People don't pay taxes with Zune Points or Disney Dollars, they prefer to think "Hey, it's just a buck." The psychological impact of having a price point at $0.99US for everything makes impulse shopping a no-brainer. Just ask all those fart app devs.The only upside is that less popular songs will be priced lower. Essentially, it's the bargain bin of the iTunes store, featuring one-hit wonders and college radio flops and a random assortment of attic-dwelling musical pieces as low as $0.69. I only hope it doesn't play into the theory of perceived value, which Joel Spolsky noted when iTunes Plus tracks debuted. Apple also said at Macworld "many more songs" will be available at 69 cents versus the $1.29 price point. It'll be interesting to see what develops and if sales suffer as a result of the changes. The labels certainly love variable pricing, and they've been right about this new digital era all along, haven't they? In the meanwhile, get your Top 40 Radio fix while you can; it'll soon be a premium experience to join the "in" crowd.
