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Wednesday, January 7, 2009

The New iTunes

In an effort to stay ahead of the market and respond to what the critics say are shortcomings, Apple has made some significant changes to it's market-leading iTunes music site.  Here are the upgrades along with some comments:
  • 3 pricing tiers - $.69, $.99 and $1.29.  Sounds good on the surface but the last thing the music industry needs to do is increase the price of any music with the economy in the shape it's in (Been to a mall lately?)  In theory the $.69 price point is attractive, but just how many of the songs that you really want do you think will be priced at this point? And how many of the hits do you think will be priced at $1.29 (how about all of them). Will be good for new artists though.
  • Most albums still priced at $9.99.  Just image how much more music would be sold if the price for catalog (older albums) was $6.99?  That's the kind of initiative the music industry should be taking to increase sales (they do it already on CDs).
  • DRM free.  DRM stands for digital rights management, which is built-in restrictions on illegal copying.  Another item that sounds good, but the only people who really ever seemed to care about DRM were the people that were going to steal it anyway.  Nice gesture but ultimately irrelevant. 
  • Wireless downloads to the iPhone.  Now this is something to get mildly excited about. Until now you had to buy the song via iTunes on your computer, then transfer it later to your iPhone. This feature eliminates an unnecessary step.
  • iTunes Plus.  Also looks like it might be a cool addition, but at a price. Not only do you get better audio quality thanks to the 256kbs encodes, but it will play on as many computers as you want, instead of the 5 that you're now limited to. The price is an extra 30 cents a song or 30% of the album cost. Worth it? To many consumers, probably not. To Apple? Let's see: 6 billion downloads x .30 = $1.8 billion!
So despite what it may look like on the surface, this announcement is anything but groundbreaking. Interesting, yes, but don't look for the future of digital music downloads to change a lot as a result. For more details, check out the Apple press release here.

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