Apple Inc. recently announced that it was changing its pricing on the popular music downloading site iTunes. The announcement was that the prices of some downloaded songs would now cost 69 cents instead of the 99 cents that has been stagnant for years (source: tech.yahoo.com). That’s great right? Well, sort of.
While it is true that some of the songs in the iTunes music library will now cost just 69 cents the key word in the statement is “some.” As some will go down, some will go up. The newer and more popular tunes will see an increase to $1.29 (source: tech.yahoo.com) so really it kind of works out to be the same thing. So why the change?
For years now sales of complete albums have been falling by the wayside. Now Apple and some music industry leaders want to make an attempt to bundle songs, videos and other content in an effort to recover from sales that were lost in the past. Now they are hoping for consumers to spend three to four dollars by offering deals or discounts whereas before they may have only purchased a single track at 99 cents (source: tech.yahoo.com).
The music industry enjoyed much success until it peaked in 2000. For the last eight years it has seen a steady decline. While song downloading via iTunes has helped out the industry immensely, it still faces tough opposition from piracy. Sites like Napster, Limewire and others have cropped up and made file sharing easy and free. While free is nice for the consumer, it is terrible for the bottom line of the music industry (source: tech.yahoo.com).
Now Apple hopes to fight back by making it easier for the consumer to bundle. Other music downloading sites are expected to follow suite with price adjustments as their respective music-licensing agreements run out. And why not? Apple enjoys an estimated 80 percent market share when it comes to digital downloads and an estimated 71 percent of all portable music players sold in the United States are Apple brand (source: tech.yahoo.com). So where the leader goes the rest generally follow.
But perhaps the biggest reason for Apple to now define a new pricing structure that will likely affect the entire industry is the fact that their tracks will soon be free of copy protection. Once this happens it will allow other portable playing devices to play Apple downloads (source: tech.yahoo.com).
So rejoice everyone because Apple iTunes songs are getting cheaper. Well some of them anyway. While the discounts will keep some money in our pockets, it is Apple’s (and the music industry’s) contention to get just a little bit more of it from us by way of multiple songs being purchased and by offering special bundling deals.