Nov
18
“Pricing sends a signal” — on variable song pricing
From the “apologies-for-the-barrage-of-iTunes-related-news-today” department: Why do the record companies insist on variable song pricing? It touches a sensitive subject which got back into the spotlight after EMI’s claims yesterday. Joel Spolsky gives an interesting spin to this story: it’s not just because the labels want more money.
Here’s the dream world for the EMI Group, Sony/BMG, etc.: there are two prices for songs on iTunes, say, $2.49 and $0.99. All the new releases come out at $2.49. Some classic rock (Sweet Home Alabama) is at $2.49. Unwanted, old, crap, like, say, Brandy (You’re A Fine Girl)—the crap we only know because it was pushed on us in the 70s by paid-off disk jockeys—would be deliberately priced at $0.99 to send a clear message that $0.99 = crap.
It’s because “pricing sends a signal” according to the author, and suddenly the labels have more leverage over their artists during negotations since they can release cocky artist’s track as a $.099 download and kill it. [via] [thanks Henning]
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