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Journal Journal: They just don't get it...

I was taking in my daily late-night intake of Slashdot and dropped by the story on Music Companies Increasing Prices. And it occurred to me: They just don't get it. The big 5 labels, the RIAA, they just don't get it.

Now, surely this has been evident for a while, you say. And, I suppose, it has. But I always held out hope that there must be someone up there in the music companies with some semblance of rational thought. Until today. I now declare that there is officially no intelligence whatsoever in the decision-makers at any of the big 5 labels.

When Apple launched the iTunes Music Store last summer, I thought that maybe it was the beginning of an about-face from the end. Give consumers CHOICE, what they WANT, is what the music store is all about. Free us from the shackles of filler songs. Eliminate the plastic disc we'd use only to bring home and rip. Yet, after 8 months of what seemed to be good times, things are slipping again. A number of recent albums are priced anywhere from 10% to 20% MORE online than as a physical product. Now, how can a distribution medium which avoids almost 100% of physical goods, pressing the disc, putting it in a case, packaging, and distribution costs cost 20% MORE than simply transcoding, adding a bit of metadata and sending it off to Apple.

It is certainly the right of music companies to price their products as they wish, however, as even the slightest bit of economics will tell you, as price increases so does demand drop. Perhaps the first thing you will ever learn about economics, and yet they raise prices, and reduce choices. Essentially, making their product less attractive to me and yet crying foul play when sales go down.

The music companies are digging their own graves, and if it continues, perhaps not even Steve Jobs can get them out of this one.

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