Source:
http://arstechnica.com/media/news/2010/02/variable-download-pricing-correlated-with-slower-music-sales.ars?utm_source=rss&utm_medium=rss&utm_campaign=rssSample:
As noted by MediaMemo, this slowdown in growth has all happened over the same period of time that the iTunes (and Amazon, and Walmart) pricing changes went into effect. No longer are digital customers able to rely on a flat 99˘ (or in Amazon's case, 89˘) price tag for music tracks—instead, they vary between 69˘ and $1.29 depending on popularity and what seems like totally arbitrary decisions. Warner CEO Edgar Bronfman Jr. insisted during the company's quarterly conference call that the pricing hike has given the company a positive overall result, but "he also suggested that in hindsight, perhaps it wasn’t a great idea to raise prices 30 percent during a recession," reports Media Memo.
This article might be biased, but really, I think it's completely valid. I'm in finance and am supposed to be on the CEOs' side, but seriously.... how the heck did these guys get their job? Did their mothers not tell them the old saying, "if something ain't broke, don't fix it"? Especially when it comes to a fricking multi-billion dollar industry? In what strange world did they rationalize that when people have been indoctrinated with the mindset that they can get the songs they want for under a dollar, suddenly it's better to charge them for more than a dollar and get away with it.
I mean... what. the. heck? Of course sales would drop. It wouldn't drop by some small amount which could get offset by the additional sales of the other remainder. No! That amount, $0.30, is a bloody small number. You know the amount of silly teenagers and yuppies who would go apeshit and stop buying from iTunes over that $0.30? Huge amount (psychological difference between nearly free and more than a dollar)! You'd have to sell so frigging many more songs through iTunes and the like to make up for that market share loss, which obviously isn't going to happen when you bloody raise your prices.
Sure, they lowered prices too for some songs and that's fair. But let's take a random guess which types of songs get their prices lowered. Hmm... I wonder if it's those songs that no one has ever heard of before and therefore are very unmotivated to buy... Hmm... Can't be.
Before you go, "this is typical companies doing price gouging on their stupid consumers", think about it for a second. Price gouging is seriously outdated and the only few people who do it nowadays are Apple, telecommunications, and companies operating in very third world countries. These days, companies gouge suppliers instead (Less public backlash unless your suppliers are slave kids). That's why I find this absurd, as it seems the ENTERTAINMENT industry who's very business depends on PEOPLE hasn't yet figured out that PEOPLE do not appreciate being taken for a ride. And this isn't their first time in awhile either, they're doing this over. And over. And over. And over again.
Yeah, bunch of buffoons. I wonder how they manage to stay in business...
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Topic: Variable download pricing correlated with slower music sales (Read 1051 times)