You have to love a price cut that turns out to be a price increase.
Well that is what you are going to get from Apple's iTines. In an interesting read over at Mcall.com, Ryan Nakashima speculates that in the end you will be paying more.
Apple recently announced their iTunes + pricing, this means that normal DRM laden songs could go for as little as $.69. However the premium DRM-Free songs will sell for $1.29. This means that your average new and popular song will now cost you $.30 more than it used to.
They also have plans to work in bundles so that collections of Songs and Videos together will seem like a better deal. In the end it looks like music industry missed the point as usual. This type of move will not slow flagging sales or piracy. It will drive more people to it than ever as people will not want to pay the extra just to get one song, or pay even more to get the one song and a bunch they will never listen to.
Read more here.
The ability to increase online sales by charging 69 cents for some tracks, while reaping higher profits on more popular songs at $1.29, was so important to record labels that until last week they had withheld licensing of over-the-air downloads to Apple's iPhone, keeping it a somewhat dysfunctional mobile music gadget. Wireless music purchases on the iPhone had previously been possible only inside Wi-Fi hot spots.
Now that Apple and the music business both got what they wanted, the pricing changes figure to be replicated on other song-selling sites as their existing music-licensing deals expire.
''I think it's going to affect everyone's pricing but I don't think it's negative,'' said Bill Nguyen, co-founder of music retailing site lala.com, which sells songs for 89 and 99 cents and songs that can be played only online for 10 cents. ''You're going to get more bundling. There'll be more discounts.''
The risks of the strategy -- that consumers will be confused or turned away -- are thought to have declined a lot since Apple launched iTunes. Back in 2003, Apple sought the simplicity of a single price as it tried to make its service ubiquitous