70¢ Floor for Digital Downloads?
By Yams
All of the four major record labels: Sony BMG, Warner Music Group, Universal Music Group, and EMI Music North America, are being accused of price fixing. The price: 70 cents a song. Resulting in a 90cent price range for songs on major carriers such as iTunes.
The industry responded that music bought on traditional CD’s or tapes cost about 70 cents per song as well.
Opponents however claim that the costs of distributing music online are significantly less, and that the price is not reflective of that.
30 cases concerning the legality of the 70 price range are being consolidated in to one law suit. The 2nd Superior Court (in NYC) has agreed to hear the case. The court will hear arguments on the profit structure of digital downloads before ruling on the specifics of each case. The complaint began over said record labels' unwillingness to work with eMusic, the second largest online music provider- behind iTunes. eMusic provides music at a whole sale price of 25 cents; The latest law suit has since prompted Warner Music Group and Sony BMG to sign deals with eMusic.
Some analyst predict the case could force the industry to create “fair” prices as a de facto settlement.
1 comments:
you know because when you buy a digital copy you get a cd, case, and insert....It will be interesting to see how this unfolds. The music industry has been out of control and out of touch with its consumer base and they need to straighten themselves out.
January 17, 2010 at 7:12 PMPost a Comment