UMG To Price New CDs Under $10 362
marmoset writes "Perhaps a decade late, Universal Music Group has decided to try out sub-$10 CD pricing in the US. 'Beginning in the second quarter and continuing through most of the year, the company's Velocity program will test lower CD prices. Single CDs will have the suggested list prices of $10, $9, $8, $7 and $6.'" CD retailers are not convinced the price cuts will work out. For one thing it depends on whether other major labels follow suit, but the article notes that "executives at the other majors were nervous about the UMG move" and "privately, some appeared annoyed."
I Am Shocked! (Score:5, Insightful)
the article notes that "executives at the other majors were nervous about the UMG move" and "privately, some appeared annoyed."
You don't say. You mean to tell me that they might have to price their music competitively? That they might have to take a pay cut in order to compete in the market? That their 'silent agreement [slashdot.org]' of what all music should cost among the biggest labels is no more?
Music record contracts really annoy me in this respect. They are nothing but middlemen when it comes to publishing music. I understand their role in promoting and paying upfront cash for studio time but their role as publishers is leech at best.
If bands had the ability to pit manufacturers against each other in publishing their CDs and albums (and also if the band could decide what percentage they needed from sales) then we would see prices dramatically plummet. Look at CDBaby and think how inexpensive it could get if that kind of market was where we bought all our CDs. And in a capitalistic world, that's how it is supposed to work. But no, acts have contracts and the most popular acts love how the labels shove only those acts down our throats. The music industry is a sorry state right now and rarely do we hear news like this. At least UMG appears to be slowly realizing that it's adapt-or-die time.
It only took a decade or so... (Score:5, Insightful)
You'd think the music companies would have at least one economist on staff who could explain to them, slowly and gently, that under certain circumstances it is actually possible to make more money when each individual unit is priced lower. It really takes some stubborn failure of logic to prioritise your sale price above your actual monetary returns.
Of course, it's also possible that the music quality will just decline to compensate for the drop in price.
I love the juxaposition (Score:5, Insightful)
Quickly followed by
"[Sales of CDs] which [are] down 15.4% so far this year. Album sales were down 18.2% last year, and 19.7% in 2008, "
I swear, Thick as a Brick should be a Jethro Tull song, not a description of record company executives....
Re:What's the first thing you would do with a CD? (Score:4, Insightful)
Try “rip it”.
Who burns CD's any more?
Re:It only took a decade or so... (Score:3, Insightful)
Of course, it's also possible that the music quality will just decline to compensate for the drop in price.
HAHAHAHAHA, oh that's a good one. A decline in music quality? You think that corporate profits influence musicians in ANY way? And I don't think that the quality of pop music has to drop very far before it becomes noise.
price fixing? (Score:4, Insightful)
If the other music groups complain or retaliate in any way, doesn't that constitute illegal price fixing?
Re:CDs! How *quaint* (Score:5, Insightful)
Audio CDs aren't quaint. They're reliable read-only long term storage media for losslessly encoded music. The data is unencumbered by DRM, you can lend CDs to your friends, you can sell CDs and you can listen to your CDs on as many devices as you like. I don't pay for downloads. I pay for CDs or get my music for free.
Re:I Am Shocked! (Score:4, Insightful)
If bands had the ability to pit manufacturers against each other in publishing their CDs and albums (and also if the band could decide what percentage they needed from sales) then we would see prices dramatically plummet. Look at CDBaby and think how inexpensive it could get if that kind of market was where we bought all our CDs. And in a capitalistic world, that's how it is supposed to work. But no, acts have contracts and the most popular acts love how the labels shove only those acts down our throats. The music industry is a sorry state right now and rarely do we hear news like this. At least UMG appears to be slowly realizing that it's adapt-or-die time.
We'll bands do have the ability to do that - it's just that an unknown band has to decide - do it myself or go with a label that may turn me into a hit? Most decide the later.
I'm not surprised that they are revising their pricing model - CD sales in the US are still significant (65% of sales) and with WalMart selling the highest share at 20% and driving pricing down to less than $10/Cd anyway all they are doing is giving in to the inevitable.
Re:CDs! How *quaint* (Score:5, Insightful)
I don't even have to take the album out of its wrapper.
Yeah, that sounds really worth the extra money. I have barely any space to store my DVDs and blu-rays in my flat right now. I'm glad I could shove all my CDs into my mum's attic. I used to have some kind of sentimental attachment to them, but that starting going after Amazon began offering cheap MP3 albums, and completely evaporated last time I had to move flat. Storing and moving CDs and DVDs is a real pain - and records would be even worse in terms of space - not to mention more fragile. I don't see anything empowering about needing to keep highly inefficient backups of what is essentially just something you want to hear - not something you need to look at or touch.
Re:CDs! How *quaint* (Score:4, Insightful)
Vinyl sales are rising because people are fools.
(There is some chance that the audio never experiences any filtering and the frequency response of the entire chain of analog equipment is such that there is no cutoff of high frequencies, and that the ears listening can hear the high frequencies, and that there isn't any dust on the record and that the record hasn't been worn by previous playback, but it isn't really all that likely)
Re:CDs! How *quaint* (Score:5, Insightful)
If you find this concept quaint then why are vinyl sales slowly rising [latimes.com]?
Because the dynamic range of vinyl albums can't be compressed as much as they are on a CD resulting in better sounding music?
Uh, that may be true, but it would also require that the overprocessed, overmodulated, autotuned, beatbox crap they're calling "music" these days be worth a shit to press onto vinyl. In most cases, vinyl is nothing more than turd polish.
Re:I Am Shocked! (Score:4, Insightful)
For less than $10 I'd buy a lot more cd's than I do now. $9 to download an album, or $8-10 to get the better quality hard copy, it's a no-brainer.
Re:The business model isn't completely dead with t (Score:3, Insightful)
Nothing.
To judge efficiencies, I’d have to also know how many CDs were sold vs. how many digital downloads were sold.
Re:Just like cassettes (Score:3, Insightful)
Price according to quality. (Score:2, Insightful)
There are quite a few artists whose new albums I want to pay $20 for. The majority however is cheap cookie-cutter crap.
Re:CDs! How *quaint* (Score:5, Insightful)
I'd rather they assumed I shop-lifted it than I downloaded it... the penalties are less severe for shop-lifters.
Re:Just like cassettes (Score:2, Insightful)
By the OP's suggestion I should ditch all my books and scan/torrent/rebuy them in PDF.
You make it sound like that's a ridiculous suggestion, when in fact there are a lot of people who want to do exactly that.
Well, maybe not PDF. But something like that.
Re:CDs! How *quaint* (Score:3, Insightful)
I don't see anything empowering about needing to keep highly inefficient backups of what is essentially just something you want to hear - not something you need to look at or touch.
Ah! You hit the nail square on the head, and didn't even realize it. People keep vinyl records not because they need to look at them or touch them, but because they want others to look at them. It's like the people who have a bookshelf stacked with all sorts of classic literature, none of which has ever been opened. It's all about appearance.
Re:CDs! How *quaint* (Score:3, Insightful)
Re:Just like cassettes (Score:3, Insightful)
Re:CDs! How *quaint* (Score:3, Insightful)
The reason some people like vinyl better than digital, is because it sounds "warmer", which is just a positive spin on "muddled" or "lower dynamic range". They complain that digital sounds too harsh.
The unpleasant truth though is LIVE music is harsh, that's the sound you don't like. You just won't find self-proclaimed audiophiles proudly saying "I don't like how live music sounds, so I prefer it run through a distortion filter first".
Re:Shocking (Score:4, Insightful)
Re:CDs! How *quaint* (Score:3, Insightful)
Re:Shocking (Score:3, Insightful)
The idea is that as the cost to produce the new medium dropped, they could take that overhead and invest it in riskier artists. Where they used to only risk a contract with a band that might sell 100,000 LPs, they could now act like indy labels and take on bands that might only sell 10,000 CDs.
Doing so, according to the article, led in part to the explosion of options in music in the 90s. Rap/Hip-hop, grunge, etc., all would have been relegated to minor labels with minor distribution channels. Green Day would have stayed on local college radio. Snoop Dog would still be rapping in his parents' garage. Etc.
As such, even with the much higher prices, album sales soared. You can argue about where the value is, but clearly the buyers were interested in having the music that *they* wanted being available on the shelves.
Take with appropriate amounts of salt. It may be that without the majors seeing this opportunities, some of the minors would have become bigger, faster. But it's an interesting take.
That having been said, they also made a bazillion dollars of those risky investments, so it's time for them to stop living off yesteryear's biz model. I'm sure they'll come up with some new way to stay rich after the CDs get cheaper.
Re:Just like cassettes (Score:3, Insightful)
Ownership confers upon you the right to listen to that song for your whole life. - Perhaps I'm in the minority on this but I still listen to tapes or records that were purchased 30-50 years ago, and every listen costs me nothing.
Re:I Am Shocked! (Score:3, Insightful)
they only have to pay a penny to the artist and half a penny to the songwriter, per song. It's the only way the label can sell the CD for so cheap and still make money..
It almost sounds like you're serious, so I'll just go ahead and point out that at 1.5 cents per song, that leave $9.75 at least out of $10.00 that does NOT go to the artist. So blaming the artist for high CD prices is of course ridiculous.
Re:I Am Shocked! (Score:2, Insightful)
Of course, the royalties are first put towards marketing expenses, production costs, daily hookers for the producer, and anything else the record label could conceivably bill before either the songwriter or the artist gets anything.
Because if it weren't for the label's, the entire music industry just wouldn't be viable. The world would be without music.
Yes! (Score:2, Insightful)
Not even the youngest generation. Napster took off about 11 years ago. Many kids just graduating college and entering the workforce probably never bought a CD during their teenage years.
Re:I Am Shocked! (Score:3, Insightful)
Which are exactly the terms the artists agreed to when they signed the shoddy contracts.