Op-Ed: iTunes Variable Pricing – Bob Lefsetz

And giving Wall Street institutions billions will solve the credit crisis.

Getting excited about multiple price points at the iTunes Store is like being thrilled there are three price points at the gas station. Or losing your cookies that Coke comes in multiple-sized cups at 7-11.

As for being DRM-free… Whoopee! As I’ve stated countless times, the only people who care about DRM don’t pay for music, they just steal it. Otherwise, Amazon would have eclipsed Apple and the Seattle company would own the online music market, not the one based in Cupertino.

To focus on per track sales at this point, so deep into the music acquisition crisis, is like focusing on NASA to solve our nation’s economic crisis. Shit, NASA came up with Tang, maybe they can figure out how to make Bernie Madoff’s creditors whole!

Detroit may be stupid, but at least they know that you don’t let the customer pick and choose every last option. Car companies sell them in PACKAGES! You want the sunroof? Then you’ve got to get leather seats and 19" rims. They’ve got the sport package. You can’t buy the stiff suspension without the bigger engine. There are marketing rules. Why does the music industry think it can break them? To think you can make up for album sales by selling individual tracks is like thinking you can pick up a whole beach with your fingers, one grain of sand at a time, rather than using a Caterpillar earth mover.

As for prices going up… Been to a retail outlet lately? Seen anybody with HIGHER prices? Only the record industry can be so stupid as to want their product to cost MORE! You’ve got to do it like the cable company, or the mobile company…. Get people to sign on at a tier, a bunch of stuff for not so much. And then, after you get them hooked, you slowly raise the price. Imagine if cell calls were still a buck a minute. Whoo, that’d kill the mobile companies overnight.

Why can’t the industry face reality… That most people own a lot of music, most of which they haven’t paid for. The key isn’t to get them to pay more for what they do buy, but to get them to pay for what they’ve stolen. Otherwise, it’s like trying to save Detroit by jacking up the prices for the cars the company DOES manage to sell!

As for prices going down… That’s about catalog and worthless material. If you think Katy Perry’s new track is going to go for 69 cents, you probably think you’re going to marry Rob Pattison or Jennifer Aniston. You’re completely delusional.

There’s nothing wrong with today’s announcement. A step in the right direction. But one that should have been taken years ago and is so small as to be almost insignificant.
The industry’s way out of its crisis is to halt restrictions, license more people who are coming up with solutions. Find a way to make music REALLY CHEAP! But selling it to everybody, in volume, to come up with a grand total. Hell, this pussyfooting, this refusal to play ball, this I’m a master of the universe is working about as well as it did for Lehman Brothers and Bear Stearns. They couldn’t possibly fail. But they did!

The record companies are laughable. Thinking they’ve got all this power, running their operations like it’s 1999, like they’ve got a clue. Thank god the government isn’t bailing THEM out. They’d just spend the money on private jets and champagne, as they continued to ruin their business.

The iTunes Store is a sideshow. But, in this rinky-dink circus, that’s all we’ve got. There’s no big tent, never mind multiple rings.

Talk about fiddling while Rome burns. These guys have decimated their business and now they want acts to give up more rights and raise prices to consumers. If labels were run by elected figures, they’d have been voted out a decade ago. Thank god their numbers are horrible. Only when they’re completely in the toilet will innovation be able to take place.

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