Apple and Music Industry.

Apple iPad – it has been a buzz word since Apple announced it back on January 27^th. Without question, Apple’s iPod and iTunes shook up and changed the music industry.  Likewise, the iPad is already generating a lot of changes in the eBook industry.  Three major publishers left Amazon due to Amazon’s fixed price policy and are now in process of renegotiation. Why? Apple simply worked with them to decide the price on eBooks. Apple lets publishers dictate their own contents’ price… but why not for music?

Apple sells 3 out of 4 songs that are sold digitally. Apple had complete domination over digital music sales since the launching of the iTunes store and the iPod. Prices were fixed – $.99 per song and $9.99 for an album. Recently Apple allowed the music industry to have fluctuating prices ranging from $.69~$1.29 per song. Currently, the result of this pricing is the decline in sales. My personal theory in the pricing of music is that a CD should be around $9 so anyone can purchase one within $10. When it comes to a single, it should been priced around $2.99. Every album has at least 2~3 songs that grabs people’s attention. I’m pretty sure people can justify purchasing the whole album if they plan to purchase 2~3 songs – it’s only fraction more. However, my theory seems too late and probably ineffective judging by the decline of sales at $1.29. To Apple contents sales are just additional revenue. Apple would never distribute part of revenue generated from its device to content providers. I believe Apple should listen to the music industry about pricing like they are doing with the publishers for eBooks when thinking of the future.