Sometimes I think the record industry is here for music lovers’ amusement. Not content with their usual paranoia about music piracy, and their eventual backtracking away from DRM, or with their attempt to squeeze more money out of artists by applying 360 degree deals, they’re now onto variable pricing at the iTunes Store.
To be fair to them, this was announced at Macworld in January 2009, but somehow the intervening two months have made it appear more ludicrous to me. From April 7, individual songs will be sold in the US at one of three prices: 69 cents, 99 cents (as is current) and $1.29. The lower price will be for unpopular songs; the higher price for more popular songs and (probably) new releases.
In most industries this pattern of pricing according to demand makes sense, but it doesn’t for music. Firstly, the labels are trying to fight piracy (which in itself is a sad case of self-delusional misdirection) so how is a 30% price hike on your most attractive product going to be received by listeners? Furthermore, the artists and bands who see the future of music realise that money is to be made only by acknowledging and embracing what their fans desire, and hence there’ll be a gradual move towards songs being given away for free, with everything else providing their income. Funnily enough this strategy kills music piracy immediately, because there is no longer anything to steal. There are a couple of hidden bonuses too: because the entry point becomes zero cost, it’s likely that more people become fans, and in turn, more fans become (un)official evangelists.
It must be terrifying for record company executives to see the value of their main product diminishing so rapidly in only a few years - that’s why they’re scrambling around for replacement revenue streams - but this is a natural consequence of digital technology. It started with home recordings, bedroom studios and DIY albums. Now with low cost content delivery networks (such as Amazon’s S3) and the maturity of social networks, most other aspects of a career can be handled and directly by musicians and their core fans. The introduction of variable pricing is merely additional proof that we’re getting closer to the demise of the industry.
