Pricing
By, Bob Lefsetz

If only tracks had cost a nickel, or a dime. Do you really think everybody
would have jumped through hoops to steal them?

Pretty soon, music's gonna be free. Call that Spotify. As for labels pulling
Spotify licenses, isn't that like the government enacting Prohibition? It would
be one thing if no one had ever gotten drunk, if the effects of alcohol were not
known. But once they were, people needed to get high, damn the law.

So I just don't understand this ten year period. What did the rights holders
prove?

That the public doesn't care about internal bickering? That licenses require
publishers and labels to agree on terms, and they can't?

That ten years of revenue not only went uncollected, but never will be?

That's why the rights holders are fucked. They continue to live in a world they
want to see, not the one that actually exists. Eric Garland proffered at NARM
that the rights holders were not prepared for terabyte transfers offline. I.e.
hard drive swapping. As for three strikes laws, intimidating both ISPs and
traders, oops, there's a question of legality. As the French court said, you
can't mess with someone's basic rights without a full legal proceeding.

When are the rights holders going to get off their high horses and realize
they're in the pit with their customers. That the day of dictation is over.
Or, are they going to be like their brethren in the newspaper business, crying
it's just not fair until the very end. And even Letterman took a cut when he
re-upped with CBS. Network ratings aren't what they used to be, and ad revenues
certainly are not.

Rights holders could have reaped revenue for a decade, and then sold consumers
the same damn tracks all over again. Instead, they fought downloading until it
became streaming. This is like losing out on the revenue of cassettes waiting
for the CD.

End result? Labels will have less power and less income. Why go with the major
label who will restrict you, yet want to take all the revenue?

Today it's not about being married to the past, but fighting for your place in
the present. iPhone has to adapt, even lower prices, to compete with not only
the Palm Pre, but Android and RIM. As for Nokia... Remember when everybody had
one in the U.S? I don't know anybody who's got a Nokia phone today. And
Motorola is going down the tubes. Their RAZR was a one hit wonder. They booked
tons of revenue for a short period of time, now what?

Point is, Apple tells app writers to price their iPhone programs extremely
cheaply, to make them impulse buys. As a result, a billion apps have been
downloaded in a month, and irrelevant of the revenue generated, it's these apps
that have made the iPhone such a dominant platform.

Let me explain this to you... The more people who have your music on their hard
drive, the more people who want to see you live and buy your merch and keep your
career going.

If you're overpriced like the Pre, and no one wants to utilize the declining
Sprint, you're dragged down the drain.

Most people can't figure out how to steal. Napster was easy, even KaZaA, but
BitTorrent is too daunting for them and the RIAA anti-piracy campaign has got
them afraid to steal. Yes, the RIAA campaign worked! It took millions and
millions of people who were consuming mass quantities of music via Napster
completely out of the game. Left them with their money and time to watch TV,
buy DVDs and play video games.

The way you deal with shrinking margins is to cut costs, not to raise prices.
Raising prices when your product can be obtained for free is like charging
$100,000 for a Hummer. Huh?

Utterly ridiculous.

http://pogue.blogs.nytimes.com/2009/06/11/snow-leopard-takes-a-page-from-the-app-store-playbook/?emc=eta1


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