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UMG To Price New CDs Under $10

kdawson posted more than 4 years ago | from the too-little-too-late dept.

Businesses 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."

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I Am Shocked! (5, Insightful)

eldavojohn (898314) | more than 4 years ago | (#31536716)

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.

Re:I Am Shocked! (3, Insightful)

Registered Coward v2 (447531) | more than 4 years ago | (#31537254)

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:I Am Shocked! (1)

Jurily (900488) | more than 4 years ago | (#31537294)

People still buy CD's?

Re:I Am Shocked! (1)

Rogerborg (306625) | more than 4 years ago | (#31537580)

At the time of writing, yes, but ask again later.

Re:I Am Shocked! (3, Insightful)

White Shade (57215) | more than 4 years ago | (#31537678)

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:I Am Shocked! (1)

Anonymous Coward | more than 4 years ago | (#31537576)

The way I see it, this is nothing more than a move to put them in a position to point a finger at music pirates and claim that illegal downloading is still costing them millions. This isn't about them making the music more affordable or reasonably priced. In a few months time, they'll come back with "People told us they pirate music because the legal channel is priced too high. So we lowered the price of CDs, but omg look - CD sales haven't gone up at all and they're still pirating our music!! We *must* use DRM and sue everybody in arm's reach to regain control!!!1!".

The companies are still thinking in terms of "CDs are the norm, digital downloads are an added convenience". This is false. Digital downloads are now the norm, CDs are left for collectors and the rare few who just like to own the physical media containing album art and inserts. The way I see it, a CD is a premium service that should cost more to have mailed to you. Digital downloads should be seen as the primary channel for distribution, and CDs are moot.

Re:I Am Shocked! (1)

clone53421 (1310749) | more than 4 years ago | (#31537642)

No, no, no... CD sales will leap, and they’ll then claim that piracy cost them ($20 – $8) x (increase in sales).

Re:I Am Shocked! (1)

Gr8Apes (679165) | more than 4 years ago | (#31538038)

Digital downloads will be the primary choice as soon as the quality is on par with CDs. (ie, lossless compression)

Otherwise, downloads are fine for that one song or two to see if you like it, but mostly they still fail on decent audio equipment for regular listening.

Re:I Am Shocked! (1)

MadKeithV (102058) | more than 4 years ago | (#31537672)

I understand their role in promoting and paying upfront cash for studio time but their role as publishers is leech at best.

They only need to front studio money because they colluded with the major studios to ask for OBSCENE amounts of money for any kind of time in there. Really, it's NOT that expensive these days for acceptable quality, if you're not one of these people that absolutely wants to use 'vintage' technology for their 'warmth' and 'character'.

For a few thousand € you can get a very acceptable recording setup and practice yourself until you get good, there are plenty of like-minded people online to give you great advice and hints, and you can still send your stuff off to a "big name" to master and/or mix it if you want to do some name-dropping.

As far as promotion goes, if you're not Britney Spears, don't get your hopes up with a label. "Promotion" often means "we'll put your CD at the back of one of the flyers we'll send to record stores".

Shocking (5, Funny)

kseise (1012927) | more than 4 years ago | (#31536724)

You mean it doesn't cost $20.00 to make a CD? Really?

Re:Shocking (5, Funny)

Aphoxema (1088507) | more than 4 years ago | (#31537180)

It actually costs 40 dollars but the labels are so generous they were paying 50% of the cost out of pocket. Their hearts grew even bigger thanks to everyone being so happy with them, so they decided to pay 75%. Soon they'll just start handing them out for free!

I love our music industry, they're so nice to us little, unimportant people!

Re:Shocking (0, Offtopic)

locallyunscene (1000523) | more than 4 years ago | (#31537426)

Dammit, I was trying to moderate this comment as funny, but it registered as overrated. Posting to undo moderation.

Re:Shocking (2, Interesting)

Life2Short (593815) | more than 4 years ago | (#31537536)

I can remember the first CD's I bought in the early 1980s. The price was much higher than vinyl, but there were a number of advantages: easier playback, no wear to CDs, etc. The other "comfort" was that I was paying higher prices for CD's because I was an early adopter of the format. As the format became more mainstream, the price would drop. Shyaaa, right...

Re:Shocking (1)

FlyingBishop (1293238) | more than 4 years ago | (#31537660)

Not if you refuse to pay the artists!

CDs! How *quaint* (4, Funny)

gestalt_n_pepper (991155) | more than 4 years ago | (#31536748)

I remember CDs. They made such pretty coffee coasters after I burned all their music to my MP3 player.

Re:CDs! How *quaint* (2, Funny)

Pojut (1027544) | more than 4 years ago | (#31536788)

Especially the AOL ones...they seemed to soak up more liquid than any of the others.

Remember: if it ain't an AOL disc, it ain't worth jack!

Re:CDs! How *quaint* (5, Funny)

WrongSizeGlass (838941) | more than 4 years ago | (#31536962)

Especially the AOL ones...they seemed to soak up more liquid than any of the others.

That's because they were specifically designed to withstand the tears of users installing AOL.

Re:CDs! How *quaint* (4, Interesting)

eldavojohn (898314) | more than 4 years ago | (#31536930)

I remember CDs. They made such pretty coffee coasters after I burned all their music to my MP3 player.

I believe the correct verb you're looking for is 'ripped.' But before you go on about how 'quaint' CDs are, keep in mind how nice it is to own something physical. You have, as a physical object, evidence of your licensing of personal enjoyment of that media. I do buy $5 albums on Amazon MP3 but I feel almost like I somehow receive less rights or a watered down licensing of that album as opposed to if I had purchased the album. If you find this concept quaint then why are vinyl sales slowly rising [latimes.com] ?

My favorite form of purchasing these albums is vinyl + lossless digital download. A lot of the indie record labels are adopting this method and you pay a $1 or $2 premium on the CD or vinyl album in order to have the music now with the physical artifact shipped to you later. I purchased my Cloud Cult albums in this manner and also She and Him. Instant gratification and I don't even have to take the album out of its wrapper. Don't expect the major labels or even Amazon to warm up to this idea though ... it's far too empowering for the consumer.

Re:CDs! How *quaint* (1)

Jaysyn (203771) | more than 4 years ago | (#31537302)

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?

Re:CDs! How *quaint* (4, Insightful)

geekmux (1040042) | more than 4 years ago | (#31537546)

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:CDs! How *quaint* (0)

Anonymous Coward | more than 4 years ago | (#31538052)

Because the dynamic range of vinyl albums can't be compressed as much as they are on a CD resulting in better sounding music?

More likely it's because of "retards" that don't really understand how "digital signal processing" works and don't understand that the "better sound of vinyl" is a result of more imperfections in the recording and reproduction cycle.

Oh wait, you think that 7th-order Chebyshev filter that eliminates the hiss and fuzz from normal analog playback somehow DOESN'T interfere with any of the music frequencies being played back? Do I have a deal on a bridge for you...

Re:CDs! How *quaint* (4, Insightful)

somersault (912633) | more than 4 years ago | (#31537364)

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* (4, Insightful)

maxume (22995) | more than 4 years ago | (#31537464)

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* (1)

Rogerborg (306625) | more than 4 years ago | (#31537534)

You have, as a physical object, evidence of your licensing of personal enjoyment of that media

Not necessarily: you could have shoplifted it. Actually, given the RIAA's attitude to its customers, they'd likely assume that until proven otherwise.

why are vinyl sales slowly rising?

From your link: "To be fair, the number is still tiny compared to overall album sales."

Pop quiz: is the increase in vinyl sales larger than the decrease in CD sales?

Re:CDs! How *quaint* (5, Insightful)

twistedsymphony (956982) | more than 4 years ago | (#31537864)

You have, as a physical object, evidence of your licensing of personal enjoyment of that media

Not necessarily: you could have shoplifted it. Actually, given the RIAA's attitude to its customers, they'd likely assume that until proven otherwise.

I'd rather they assumed I shop-lifted it than I downloaded it... the penalties are less severe for shop-lifters.

Re:CDs! How *quaint* (2, Interesting)

Aphoxema (1088507) | more than 4 years ago | (#31537614)

[...] before you go on about how 'quaint' CDs are, keep in mind how nice it is to own something physical. You have, as a physical object, evidence of your licensing of personal enjoyment of that media.

Though the short life expectancy of CDs appears to have been greatly exaggerated, they do have a finite lifespan while music in a more transient form can happily be saved from one hermetically sealed hard disk to the next. Either way, all the CRC checks in the world can't guarantee immortality of any data.

Speaking of transient... I've lived most of my teens going from one place to the next, often losing or giving away my possessions in the process. Those quaint, physical goods meant bullshit to me sleeping in an alley or at so-and-so's couch for the week.

What did comfort me was recovering collections of music from friends I shared with since the days of Napster, an impossibility if relying solely on CDs, regardless of the legality.

I'm an immaterial girl living in an immaterial world. Well, except for my recent journey into my PS3 and buying up used games for it. At least Blu-rays are a little sturdier than DVDs and CDs.

Re:CDs! How *quaint* (1)

Animaether (411575) | more than 4 years ago | (#31537616)

why are vinyl sales slowly rising?

In my view, from the situation in NL:
A. People like you who want to have something physical even though you "don't even have to take the album out of its wrapper". Which means it's going where, exactly? On the wall? Into a filing cabinet of some sort? A box in the attic? I suppose maybe 50 years down the road if the indie band got big the vinyl might hold some great resale value, especially if it's still in mint wrapped condition. I guess that might form a sub-section A2: those who think it's an investment piece.. but that's got to be extremely marginal :)

B. People who like to claim that vinyls sound much better, more warm, yadda yadda.. even if most of the vinyls today are mastered -from- the same content that goes onto the CD version. They can still be better technical quality than CD (16bit 44.1kHz vs 24bit 96kHz, for example), but any other argument is moot. This does exclude those where the entire pipeline went from the raw recording to the vinyl -with- the vinyl in mind (i.e. little to no compression, more careful stereo separation, etc.)

C. Pretentious people who just want the vinyl + player prominently presented in their living room for the sole purpose of having others comment on it.

D. DJs who prefer working with the tactile feedback of vinyl, rather than virtual mixing and scratching pads (or even just pushing sliders on a computer screen around) necessitated for CD playback (and at that point, you might as well use digital files all the way).

E. ?

Note that only one of those has a reasonably rational argument - but let's face it.. vinyl sales aren't targeting people who are thinking rationally any more than companies selling GPS bluetooth devices (where you're often far better off ditching your current phone/PDA and getting one with GPS built-in).. and I don't blame them... there's obviously an audience.

Re:CDs! How *quaint* (4, Interesting)

jayme0227 (1558821) | more than 4 years ago | (#31537620)

If you find this concept quaint then why are vinyl sales slowly rising [latimes.com] ?

Probably for the same reason that young people prefer MP3s to higher quality music. [slashdot.org] People grow up listening to music in a certain way and the cracks and pops of vinyls, much in the same way as the sizzle sounds of MP3s, are what the listener expects to hear in the music. Because they expect to hear it, the music doesn't sound "right" when they hear high quality recordings without it. So now that baby boomers are reaching retirement age, they look back at what they loved when they are younger and buy old vinyls.

Re:CDs! How *quaint* (3, Informative)

MBGMorden (803437) | more than 4 years ago | (#31537640)

If you find this concept quaint then why are vinyl sales slowly rising?

Even the link you quoted shows that ALL forms of music - CD's, digital, AND vinyl - are rising in sales. Vinyl also, despite "rising" sales, is still not really selling in any significant amounts.

As the article pointed out, Taylor Swift's latest album sold nearly twice as many copies in six months as the ENTIRE SALES VOLUME of vinyl records in a year.

Vinyl is making about as much of a comeback as any other retro tech - some people are clinging to it, but you're dreaming if you think that there's going to be some mass movement back to the format.

Re:CDs! How *quaint* (5, Insightful)

Anonymous Coward | more than 4 years ago | (#31537252)

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:CDs! How *quaint* (1)

afidel (530433) | more than 4 years ago | (#31537512)

I can do all that with Amazon MP3's (well perhaps not lend them legally) without the inconvenience of physical media and with the ability to easily have a backup (Mozy for the win).

Re:CDs! How *quaint* (0)

Anonymous Coward | more than 4 years ago | (#31537610)

So you don't have a long-term storage medium (CD-Rs don't last as long as pressed CDs), your music is encoded with a lossy codec, you can't lend your music to friends, but really, there's no difference.

Re:CDs! How *quaint* (1)

EvanED (569694) | more than 4 years ago | (#31537908)

So you don't have a long-term storage medium (CD-Rs don't last as long as pressed CDs), your music is encoded with a lossy codec, you can't lend your music to friends, but really, there's no difference.

I've only done the Amazon MP3 thing once because of the lossy codec thing, but your other arguments are kind of dumb. It's probably *easier* to "lend" your music to friends with an MP3, and it's not like you're forced to store them on burned CDs. Passing the data from one hard disk to another is plenty sufficient. (And with the online backup he mentioned, he's got a distributed backup in case his house burns down.)

Re:CDs! How *quaint* (1)

Maxo-Texas (864189) | more than 4 years ago | (#31537356)

CD's are much prettier coasters after you burn them in the microwave.

MP3! How *quaint* (1)

mister_playboy (1474163) | more than 4 years ago | (#31537698)

I remember MP3s. They made a nice way to conveniently transport your music until they were first replaced by better lossy formats, and then made obsolete by lossless formats that take advantage of the abundance of cheap storage.

Only ... (1)

6031769 (829845) | more than 4 years ago | (#31536758)

25 years too late. Oh well, better late than never.

0$ (2, Interesting)

krapski (1478035) | more than 4 years ago | (#31536812)

I get them for 0$ in pirate bay, how do you compete with that!?

Re:0$ (1)

Bill, Shooter of Bul (629286) | more than 4 years ago | (#31537402)

Its like Canadian complaining that there isn't any caribou when he visits miami. Obviously the miami supermarkets are crazy to offer so much chicken and so little caribou. How will they ever survive?

Re:0$ (1)

afidel (530433) | more than 4 years ago | (#31537542)

That $0 comes with a !=0 chance of a six figure lawsuit attached.

Re:0$ (1)

NeoSkandranon (515696) | more than 4 years ago | (#31537966)

Many of us place a nonzero value on being a mature adult and either paying for entertainment we consume or abstaining altogether.

Just like cassettes (3, Interesting)

commodore64_love (1445365) | more than 4 years ago | (#31536832)

...when they still existed. I remember having the option between a $13 CD or an $8 "inferior" cassette version, so I picked the cassette. I didn't see why I should have to pay a $5 premium for the disc version.

Now it appears the same pricing has come to CDs. Why pay $13 for a CD when I can just download my favorite 2-3 songs at about $3. The internet is forcing music companies to drop the pricetag for the "inferior" CD format to about $8.

Why inferior?

CDs aren't portable. And take-up a lot of space.

Re:Just like cassettes (3, Funny)

Pojut (1027544) | more than 4 years ago | (#31536878)

CDs aren't portable. And take-up a lot of space.

My binder with 300+ death metal CDs and the jewel case inserts in it from high school would agree with you -_-;;

Re:Just like cassettes (1)

ajlitt (19055) | more than 4 years ago | (#31537284)

I have about the same number in a random collection of CD binders. They take up a tiny fraction of the space on my shelves, the rest being populated by books. In digital form, those books would all fit on just a few CDs. By the OP's suggestion I should ditch all my books and scan/torrent/rebuy them in PDF.

Re:Just like cassettes (1)

introspekt.i (1233118) | more than 4 years ago | (#31537930)

By the OP's suggestion I should ditch all my books and scan/torrent/rebuy them in PDF.

No, he didn't come out and say that. He said that the prices of CDs have dropped because they are an inferior medium (decidedly by the consumer's purchasing habits). Inferior because they take up space and aren't portable relative to an electronic copy. You could follow that your books are an inferior medium to ebooks, but there are a few kinks with ebooks left to work out, namely how the reading feels with books v ebooks.

Re:Just like cassettes (2, Insightful)

Jer (18391) | more than 4 years ago | (#31537950)

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:Just like cassettes (5, Interesting)

floatednerd (1667997) | more than 4 years ago | (#31537002)

Maybe I'm going into the future kicking and screaming... but I don't feel like I "own" a song unless I have it on CD (or cassette, vinyl, etc). From my point of view, CDs are the "superior" product verses the MP3 from iTunes or Amazon.

Re:Just like cassettes (1)

jedidiah (1196) | more than 4 years ago | (#31537370)

Yes. A CD is a token of ownership. While the CD certainly isn't convenient
to deal with, it's easy enough to convert into an mp3. Once you have that
then how to you tell your own copy from someone elses? How do you prove
you really have the rights to that file? You can't really. If it's a DRM
server or your sales history at Amazon, your still dependent on data on
some server somewhere to validate your right to that file.

Re:Just like cassettes (1)

andi75 (84413) | more than 4 years ago | (#31537608)

Why would I need to validate that it's mine? It's not like the RIAA has a right to search my mp3 player and demand that I produce a licence for all songs on it.

Re:Just like cassettes (3, Insightful)

ZOmegaZ (687142) | more than 4 years ago | (#31537712)

Yet.

Re:Just like cassettes (1)

introspekt.i (1233118) | more than 4 years ago | (#31537980)

Once you have that then how to you tell your own copy from someone elses?

A CD is a token of ownership.

You answered your own question. Proof of purchase is the CD and or the receipt from where you picked it up.

Re:Just like cassettes (2, Interesting)

clone53421 (1310749) | more than 4 years ago | (#31537386)

Why would I want to “own” a song? I just want to listen to it.

Re:Just like cassettes (0)

Anonymous Coward | more than 4 years ago | (#31537444)

but I don't feel like I "own" a song unless I have it on CD (or cassette, vinyl, etc).

What difference does it make? You are only renting it from the record company until a new audio format comes along and they demand you make a new payment on your 'subscription' anyway.

Physical media doesn't mean jack anymore, especially with the DRM crap packed on.

Re:Just like cassettes (1)

Yaa 101 (664725) | more than 4 years ago | (#31537780)

Nothing keeps you from burning that song to CD.

Re:Just like cassettes (1)

SimonTheSoundMan (1012395) | more than 4 years ago | (#31537030)

Ok, but you have a physical copy that hasn't been compressed to 256kb/s or lower MP3/ACC files, the disc will last hundreds if not thousands of years, and best of all you can do whatever you want with it.

CD's are cheaper in the UK than downloads. £5-£7 for the CD album, whereas on iTunes it can be £6.99 to £8.99. I think it is great he USA have matched our prices.

Re:Just like cassettes (1)

tomhudson (43916) | more than 4 years ago | (#31537704)

the disc will last hundreds if not thousands of years

Even if it did, that wouldn't matter - how much longer do you think spinning optical media readers will be around?

Audio went from 12" 78 rpm to 10" 78 rpm to 12" 33-1/3 rpm and 7" 45rpm disks to tape, which went from reel-to-reel to 8 track to cassette to DAT, to hard drive/flash memory.

CD *tried* to go from 5" redbook to SACD (failed) and mini-cd singles (failed).

Video recording went from celluloid to reel-to-reel tape to tape cassettes / dvd / hard drive / solid state devices / bluray

Still photos went from celluloid to digital.

Most homes can no longer play audio records on vinyl, or reel-to-reel, or 8 track, or cassette, or DAT - just what's stored on a file in a device.

Most homes don't have movie projectors, or even functioning VCRs any more.

Cameras that use film? How quaint.

Optical media will be the next to go over the next 2 decades, same as all the others.

Re:Just like cassettes (4, Funny)

whisper_jeff (680366) | more than 4 years ago | (#31537410)

Did you seriously just write "CDs aren't portable"? Really? I know nerds have the stigma of being out of shape, but really?

Re:Just like cassettes (1)

omnichad (1198475) | more than 4 years ago | (#31537746)

I think they mean entire collections of CD's, as opposed to an iPod or a portable hard drive.

It only took a decade or so... (4, Insightful)

TACD (514008) | more than 4 years ago | (#31536882)

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.

Re:It only took a decade or so... (2, Funny)

Anonymous Coward | more than 4 years ago | (#31537010)

Of course, it's also possible that the music quality will just decline to compensate for the drop in price.

No, no that's not possible.

Re:It only took a decade or so... (0)

Anonymous Coward | more than 4 years ago | (#31537116)

...under certain circumstances it is actually possible to make more money when each individual unit is priced lower.

Case in point, look at what happened when Valve temporarily slashed the price on Left 4 Dead a while back - from full retail price down to $15-20, IIRC. Sales that weekend skyrocketed. The price point hit that impulse-buy sweet spot, where even if it turned out to suck, or you play it just a couple times and forget about it, no big loss. The same sure as hell applies to music. Few things burn like paying $15 for a single decent track, but a sub-$10 burn I can live with.

Re:It only took a decade or so... (1)

EvanED (569694) | more than 4 years ago | (#31538014)

Case in point, look at what happened when Valve temporarily slashed the price on Left 4 Dead a while back - from full retail price down to $15-20, IIRC. Sales that weekend skyrocketed.

I was going to reply with this exact example. According to Jeff Atwood [codinghorror.com] quoted an article saying that the sale didn't just dramatically increase sales and didn't even "just" cause more copies to be sold than launch, but brought in more raw revenue than launch day did.

Re:It only took a decade or so... (2, Insightful)

HeckRuler (1369601) | more than 4 years ago | (#31537162)

Not so much in the long run when you've got a monopoply of a few oligarchs who all collude to keep prices high. Now that one of the prisoners has come face to face with his dilema, he's breaking ranks and diving for some quick cheap cash.

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.

What's the first thing you would do with a CD? (3, Interesting)

thered2001 (1257950) | more than 4 years ago | (#31536914)

If given a music CD, what would be the first thing you'd do with it? Play it or burn it? (Or give it back with an apology of "this is not a format I support any more"?)

Re:What's the first thing you would do with a CD? (0)

Anonymous Coward | more than 4 years ago | (#31537028)

rip it

Re:What's the first thing you would do with a CD? (4, Funny)

quantumplacet (1195335) | more than 4 years ago | (#31537076)

I dont know, most cd's that come out these days I'd rather burn than rip...

Re:What's the first thing you would do with a CD? (1)

julesh (229690) | more than 4 years ago | (#31537584)

I dont know, most cd's that come out these days I'd rather burn than rip...

Having tried this with a box full of AOL cds, I can tell you you have to have a *very* hot fire to get them to burn.

Re:What's the first thing you would do with a CD? (1)

MachDelta (704883) | more than 4 years ago | (#31537976)

I put an AOL CD on the BBQ once. It actually surprised me how quickly it softened and then began to sag into grill. I had to be pretty quick with a fork to scoop it off before it fell onto the burners. And then I had to twirl the fork to keep the melted CD from dripping onto the ground. I actually ended up with a pretty cool looking plastic blob wrapped around the fork, but unfortunately I couldn't get the fork out without smashing my "artwork". :(

Re:What's the first thing you would do with a CD? (3, Insightful)

Mr. DOS (1276020) | more than 4 years ago | (#31537064)

Try “rip it”.

Who burns CD's any more?

Re:What's the first thing you would do with a CD? (1)

keeboo (724305) | more than 4 years ago | (#31537662)

Who burns CD's any more?

Interesting comment from someone with a nickname like yours.

Re:What's the first thing you would do with a CD? (1)

omnichad (1198475) | more than 4 years ago | (#31537774)

I burn my CD's. Otherwise, they're just empty.

Archive to FLAC (0)

Anonymous Coward | more than 4 years ago | (#31537834)

Archive to FLAC and put it away for storage, like I do with all my cd's. With a proper lossless archive like FLAC, you forever have the option to convert to any lossy format you chose, for a perfect "first generation" copy. On your main computer, of course, you can just load the entire FLAC archive into your music player and play off that.

Why mess around with buying mp3's when you can get the real thing? I keep a running list of albums I might want to buy, and every few months I order a batch of about 10 used cd's from a used cd store like this [secondspin.com] . It's not hard to choose between $5 for the real deal and $10 for mp3's (which, no matter how good the sound quality, can never be bit-for-bit identical to the original WAV files on the original disc).

Re:Archive to FLAC (1)

NeoSkandranon (515696) | more than 4 years ago | (#31538042)

+5 informative for the link to secondspin, thanks.

Re:What's the first thing you would do with a CD? (0)

Anonymous Coward | more than 4 years ago | (#31537898)

I normally just torrent the album any way. Saves having to install a program to rip the CD and messing about getting the encoding right. In fact I have normally already downloaded the album and decided that it is worth buying.

How much for the artists ? (1)

Yvanhoe (564877) | more than 4 years ago | (#31536970)

Sell them $99 or $0.01, I am not willing to pay for middlemen more than the final artist will get. I think I'll wait for flattr.

I love the juxaposition (5, Insightful)

edremy (36408) | more than 4 years ago | (#31536992)

""Why does Universal feel the need to get below $10?" a senior distribution executive at a competing major asked. "

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....

The business model isn't completely dead with this (3, Interesting)

Coopjust (872796) | more than 4 years ago | (#31537006)

I'll be honest. I'm usually more of a singles person than an album person.

However, when the album and digital copy are near the same price, the physical copy provides a long lasting backup (pressed CDs last longer than burnt), and I have a lossless copy that I can legally use, rip to lossless on my PC, and not have to go on a tracker and seed until my eyeballs fall out of my head for the ratio...it makes sense for a number of albums.

Weird Al Yankovic stated that he was happy for either avenue his customers used to buy music, but his take per track on iTunes was about two cents a track and his take on CDs was about 26 cents- which is pretty major if you want to support the artist.

Anyhow, it's a good move by UMG, albeit overdue. I think it's like the MPAA- the "boston strangler" of VHS turned out to be a major blessing and boon to their business. Hopefully other companies follow suit.

One more thought (1)

Coopjust (872796) | more than 4 years ago | (#31537068)

If I was a used CD retailer, I'd be scared right now. You're probably selling the CD for less anyways, but with the price difference being much less, you might lose a lot of your customers since the price of a new CD that supports the artist and is in immaculate physical condition is only a few bucks more.

Competition is always good though, and I'm sure used stores will be fine.

Speaking of businesses being threatened, I don't see the "as a record store owner, my business faces ruin" troll yet.

Re:The business model isn't completely dead with t (1)

MarkvW (1037596) | more than 4 years ago | (#31537648)

If artists make 13 times more money on CDs than they do on itunes, what does that tell you about efficiencies in the music marketplace?

Re:The business model isn't completely dead with t (2, Insightful)

clone53421 (1310749) | more than 4 years ago | (#31537692)

Nothing.

To judge efficiencies, I’d have to also know how many CDs were sold vs. how many digital downloads were sold.

Re:The business model isn't completely dead with t (1)

ZOmegaZ (687142) | more than 4 years ago | (#31537796)

Weird Al Yankovic stated that he was happy for either avenue his customers used to buy music, but his take per track on iTunes was about two cents a track and his take on CDs was about 26 cents- which is pretty major if you want to support the artist.

Of course, if you're buying tracks off the CDs they don't make any more, it's the difference between some profit and none.

Too late (3, Interesting)

Junior J. Junior III (192702) | more than 4 years ago | (#31537026)

This would have been a great strategy for the late 1990's, when the CD was still a relevant media (and, for that matter, when consumers were demanding that prices be lowered, both through their words and through their actions -- which the industry by and large ignored completely).

I'm not sure I'd call CDs relevant still. We've moved on to solid state media, writeable storage decoupled from the content. You could discount 8-track tapes and they wouldn't sell today. CD's don't have the same analog appeal that vinyl records to, either. I expect that eventually they'll just stop making CDs, and all music will be distributed via the network.

This price reduction merely indicates that we're a little bit closer to that day. I doubt it'll do much to boost sales at this point.

Normal price here. And still way overpriced. (4, Interesting)

wvmarle (1070040) | more than 4 years ago | (#31537192)

In Hong Kong a typical release CD of some local artist costs around USD 10 already. That's been since I moved here 7, 8 years ago. Older releases cost less. Import from US is typically USD 8-12 for a CD.

Now there are a few differences: the entertainment world lives on a smaller budget and the top artists are at a level that wouldn't even make it into American Idol. That says more about the cantopop than about American Idol.

Movies on DVD cost about USD 20 (new releases), older movies are sold at far cheaper prices. On VCD one can buy a movie for a few dollars.

The above prices are for the official media, not for the pirated ones. Those are far cheaper.

Still I think US$10 for a CD is overpriced. Pirated CD's are selling for well under USD 1 each. So that is a $9.something mark-up for what? Recording and artist's share?

Both pirated CD's and official CD's have to be manufactured and distributed. That incurs costs that are independent of the content. The only difference is the actual recording and the marketing. Even the shops selling pirated disks are in the same expensive locations as the official outlets, so even there is no difference: they both have to make the same profit to survive. Both shop's suppliers have to run their trucks and pay their drivers and workers and run their CD/DVD machines.

Official releases have better quality CD (technical: play guaranteed, last longer than a few years) and come in jewel case instead of paper sleeve. That may add $0.20-0.30 to manufacturing. Even when selling at USD 2.50 each the label should be able to make a USD 1.00 gross profit on each. And at that price level it becomes vending machine material, and volume may skyrocket due to all those impulse buys. Sell a million disks, make a million in gross profit. If a million dollars is not enough to cover recording, marketing, and a fat profit, then you're doing something terribly wrong.

Songwriter's share of the royalties (1)

tepples (727027) | more than 4 years ago | (#31537372)

Even when selling at USD 2.50 each the label should be able to make a USD 1.00 gross profit on each.

The songwriter (who is often not the recording artist) would disagree with that. The US copyright royalty board has set a statutory rate of about 9 cents per track split between the songwriter and his music publisher, tied to the Consumer Price Index.

Re:Songwriter's share of the royalties (1)

wvmarle (1070040) | more than 4 years ago | (#31537680)

Then where does the rest of the money go?

USD 10 retail price

20% for the shop: USD 2, shop pays distributor $8 each.

$0.50 each for distribution (let's be generous), USD 7.50 to the CD manufacturer.

$1.50 for manufacturing of the disk, case, booklet (I'm in a generous mood tonight), $6.00 left.

$0.09 for royalties: $5.91 gross profit for label? For recording costs? Marketing costs? Even liberally applying other costs on the CD process there is stil a lot of money unaccounted for.

Besides I wonder wtf some "copyright royalty board" has to do with setting rates. Isn't such a rate decided as a matter of negotiation between artist and publisher?

Re:Songwriter's share of the royalties (1)

NeoSkandranon (515696) | more than 4 years ago | (#31538110)

Marketing. Promotion. Paying off radio stations to play the song seven or eight times a day.

Re:Normal price here. And still way overpriced. (0)

Anonymous Coward | more than 4 years ago | (#31537522)

Wow.. I want what you're smoking. Maybe you should start a band and make a million dollars with your burnt/sleeved CDs.

"privately, some appeared annoyed." (0)

Anonymous Coward | more than 4 years ago | (#31537224)

Doesn't this just imply collusion, when we have executives at other companies "annoyed" when UMG lowers prices? What right do they have to tell UMG what prices to set?

price fixing? (3, Insightful)

eagl (86459) | more than 4 years ago | (#31537238)

If the other music groups complain or retaliate in any way, doesn't that constitute illegal price fixing?

Good job guys (1)

Taibhsear (1286214) | more than 4 years ago | (#31537272)

Welcome to the 21st century. *cough* [independent.co.uk]

"Single CD's" will have the suggested list prices (1)

VShael (62735) | more than 4 years ago | (#31537326)

Am I the only one that read that and said "Oh, so the album CDs will still be 25 bucks?"

Re:"Single CD's" will have the suggested list pric (1)

keeboo (724305) | more than 4 years ago | (#31537874)

That's not the worst.
What about things like 40 y.o. Beatles albums? Wasn't everyone paid properly already?

Perhaps not... I mean, it seems that Paul McCartney is still unable to afford buying meat, after all those years!

'Single' CD's? What are those(Must be getting old) (0)

Anonymous Coward | more than 4 years ago | (#31537424)

Do they mean like a regular album? Did they ever release singles that are the equivalent of 45rpm records? Don't look at me like that.

Did they ever release a single song CD to promote the song as a single? Maybe that partly explains why they missed the boat. They were saying buy the whole thing, can't have just a taste for under $5. Hello, anybody home. This is the 80s calling, we want our business model back.

The Music Industry 'Gets it' (1)

tpstigers (1075021) | more than 4 years ago | (#31537456)

Every time the price of music comes up, I read dozens of comments that say, in a nutshell, that the music industry 'doesn't get it'. And yet, they're still up to their necks in money. While the music industry (and the film industry) seem to be doing everything in their power to resist the onslaught of the internet, their continued profits would argue that their resistance is not exactly futile.

Huh? (2, Funny)

Fnord666 (889225) | more than 4 years ago | (#31537524)

What's a CD? Some sort of offline backup of the originally seeded songs?

Bad marketing decision (0)

Anonymous Coward | more than 4 years ago | (#31537694)

CD's priced at $9.99, $8.99, $7.99, $6.99, and $5.99 would sell a lot better.

Price according to quality. (2, Insightful)

FlyingBishop (1293238) | more than 4 years ago | (#31537714)

There are quite a few artists whose new albums I want to pay $20 for. The majority however is cheap cookie-cutter crap.

so, (0, Redundant)

syrinx (106469) | more than 4 years ago | (#31537788)

what is the price of buggy whips nowadays?

Maybe it will push down used CDs too. (1)

stomv (80392) | more than 4 years ago | (#31537798)

I buy about 100-150 CDs each year, and the only ones which come shrink wrapped are local bands who self-publish. The rest of my CDs all come used -- local shops, eBay, amazon, GoodWill, friends, whatever. I've got a long list of music I'd like to own, and I'm in no hurry to buy any particular album, so I rarely pay more than $3 for a CD (including shipping). Since I listen to music from mp3 files 100% of the time, a slightly damaged jewel case or booklet doesn't matter to me.

It costs me less to own more, I'm not giving any money to the MPAA, and I'm not involved in creating more plastic waste -- we Americans own enough crap already. If this helps depress the price of used CDs too, that's ab-fab!

Premium vs Discount Format (4, Interesting)

BlueBoxSW.com (745855) | more than 4 years ago | (#31537852)

I see this as a really important shift.

Previously, the CD was the premium format, with all it's uncompressed audio glory. And it is fairly portable, playable in most consumer electronic devices found in the living room or car.

The MP3/AAC format was the discount format. Compressed with some audio loss, and playable in less devices. Also encumbered in some cases with DRM.

The premium format carried a 50% markup, with most MP3 albums costing around $10, and CD's costing around $15.

With CD's potentially costing LESS than MP3/AAC formats, this signifies the market is placing premium on the MP3/AAC format over the CD. This could be because the format is now supported in more devices, or consumers find it friendlier to deal with, perhaps because there's no need to fight the packaging then burn it on your own.

Physical media is obsolete (1)

Trip6 (1184883) | more than 4 years ago | (#31538076)

Except for the DRM, which Mr. Jobs has mostly figured out, physical media has no reason to exist. It's a shame that the most popular formats are so compressed, but that will improve with more bandwidth and Moore's law. Ultimately, the quality of your DAC and transducers (i.e. speakers) determines the quality of your playback level. Vinyl has a certain appealing sound characteristic when enough money is spent on the playback but will never become mainstream again, relegated to hobby status.

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