January 31, 2007

The biggest thing driving prices to $9.99 is iTunes. Physical retailers are pressuring the labels downward on price (of course, Wal-Mart is the biggest culprit) because they don't want to be undercut by iTunes 9.99 on all single albums. We're rapidly moving to a 9.99 world on the big sellers (the ones stocked in Target and Wal-Mart and Best Buy).

To accomplish this, I am told, particularly on new releases, the labels are doing what they historically did in the physical world and buying into "retail" programs -- in essence, paying for price and positioning or other marketing tools on Amazon by giving them functional breaks.

January 30, 2007

I checked my Blackberry to find that iTunes has an exclusive with the Decemberists. It is an in store recorded at the swank (with all due respect) Soho location a few months ago. Now, this is a band that has LIVED at indie retail forever. Even at Capitol, we have made a very important contribution to the sales of The Crane's Wife. Our Capitol folks have been very supportive. We have been pounding the Decemberist's management and label for the same type of cool product for the past two years. I even cornered the lead singer, at LaGuardia for a few hours to explain our game. Guess what? Seems EMI UK has this policy that exclusive content only can be granted as DIGITAL content. Oh, I see. It is easier to deal with the retailers who are paying a small increment of your income instead of the retailers who are paying the bulk. It is also amazing that you would grant exclusive content to the very channel that is NOT replacing your lost income dollar for dollar. Keystone Cops indeed.

On the digital side, we fully intend to sell music. However, we have watched one idea after another throw tons of money at the concept with only one winner -- Apple. We are only interested in launching a digital service that is DRM free. Hopefully we will get on the map in the coming year with our ideas. One thing is for sure; we have amazing brands in many parts of the country. Trusted brands that will continue to be a filter for fans of music. Even though the Internet is world wide, we find that many people are using it locally. I hear constantly from owners who report amazing response to their email blasts about what is happening in the stores and from customers who actually check stock levels online before driving to their favorite music emporium.

January 29, 2007

I have purchased about 600 songs off of the iTunes Store, 2 movies, 56 music videos, two TV series (season 10 of South Park and season 2 of Ghost Hunters), and one game. I think I have spent around $800 on purchased items. Then again, I started purchasing songs back in 2003 so some of them are pretty old.

January 26, 2007

January 25, 2007

January 24, 2007

Meanwhile, a back door has appeared in the Music Store itself: While iTunes Japan pegs foreign undesirables from their credit card numbers, it can't screen fake Japanese addresses provided by prepaid iTunes Card users. There's a small but ardent underground economy among Americans in dummy addresses and e-mailed scans of Japanese iTunes Cards, picked up by friends in Tokyo convenience stores or openly sold online.

January 23, 2007

The bigger picture, however, only grows fuzzier. As young people choose to discover, share and collect music via iTunes, blogs and MySpace, decades of music research suddenly seem irrelevant. If listeners can create their own music stations, what will radio's role be?

Wrong question, many radio executives contend: Choice is overrated; most people don't want to spend their leisure time sifting through hours of mediocre tunes in search of their new favorite. They just want someone to deliver the music they love. The trick for radio is to find a way to capture the spirit of the Web -- the interactivity, the flattened hierarchy, the sense of empowerment -- while maintaining radio's traditional authority ("The hits from coast to coast," "The hits just keep on coming").

Bowie, Md: Imagine if the restaurant industry operated like the radio industry. All we would have to eat is hamburgers, hot dogs, and pizza.

Marc Fisher: All too true.

January 22, 2007

Personally, I like it better this way: Many musicians have a sublime song or two in them; not nearly as many can pull off a great album. And in the CD era, albums have become too long -- when I was a kid, an LP that lasted more than 45 minutes was rare and, truth be told, somewhat annoying. (It took up more than one side of a 90-minute cassette tape, meaning you had to cut a song.) CDs are great for reissuing old albums with additional tracks, but with new albums they seem to encourage bloat: Songs that once would have been left in the studio now clutter up the works. (Your mileage may vary, of course -- like I said, I'm a song guy.)

January 19, 2007

The Apple iPod and Microsoft Zune digital media players do not currently support protected WMA-format files, and will not play Wal-Mart Music Downloads.

Walmart.com has a large selection of WMA-/DRM-compatible digital music players available at great prices.

January 18, 2007

As a "long tail" Internet retailer Amazon already sells a lot of music from independent labels, certainly significantly more than the three retailers ahead of it in terms of overall market share (Wal-Mart, Best Buy, and Target). Amazon thus already has a built-in audience for selling digital downloads from independent labels, and thus the lack of major label content would not hurt it as much as it would others.

January 17, 2007

In his blog, Cisco General Counsel Mark Chandler plays to the gallery with talk about mom-and-Apple-pie values such as "interoperability" and "open" standards. He says Cisco's goal is not to shake loose some money, but to start a "collaboration." Of course, if such a partnership were appealing to anybody but Cisco, Cisco would hardly need to extort Apple's agreement by putting a gun to the head of its six little hostages. Because that's all Cisco has to offer -- those six little letters. In return, it wants a piece of the wholly owned money machine that Apple has created by convincing so many consumers to lock themselves into Apple's world and pay a hefty markup for the privilege. Collaboration is not Apple's game -- the company has been determinedly building its present prosperity on the closed standards of the iPod and iTunes. Cisco's proffer, in other words, is the equivalent of slipping and falling on Mick Jagger's sidewalk, then trying to parlay it into a place in the band (with royalties, of course).

January 11, 2007

As for gift cards -- well, let's just say there is good reason that they are known within the retail industry as a stored-value product: they store their value very well, and often permanently. The financial-services research firm TowerGroup estimates that of the $80 billion spent on gift cards in 2006, roughly $8 billion will never be redeemed -- "a bigger impact on consumers," Tower notes, "than the combined total of both debit- and credit-card fraud." A survey by Marketing Workshop Inc. found that only 30 percent of recipients use a gift card within a month of receiving it, while Consumer Reports estimates that 19 percent of the people who received a gift card in 2005 never used it.

Labels: Apple, digital breakage, gift card economics, gift cards, iTunes

January 04, 2007

The device was as elegant as an old cigarette case and not much larger than a child's palm. I was holding a video iPod, poised at the frontier of a new digital age, a new platform for movies, a new convenience that will annihilate old paradigms. Last spring and summer, when I visited a number of executives and tech guys in big-studio Hollywood, I kept hearing disdain for the mall cinemas and the multiplexes -- the theatres in which most Americans see movies. And I heard a new mantra: "Content on demand -- when you want it, where you want it, and how you want it." By the end of the summer, movies were beginning to flow into homes and portable devices through the Internet. In September, Apple began offering previously released Disney movies through its iTunes Store. I downloaded the first "Pirates of the Caribbean" onto my hard drive, then put it onto a video iPod. The screen was only two inches across.

If you are sitting down, the natural place for an iPod is in your lap; that way, your arms don't get tired. At that distance, however, I couldn't focus on the image. So I rested the iPod on my stomach. And there it sat, riding up and down every time I took a breath. I was on the Black Pearl, all right, standing on her foredeck like a drunken sailor as she plowed through heavy seas. The horizon line kept pitching and heaving, and I had trouble seeing much of anything. "Pirates" has lots of wide vistas and noisy tumult -- a vast ocean under the dazzling sun and nighttime roughhousing in colonial towns, with deep-cleavaged prostitutes and toothless drunks. What I saw, mainly, was a looming ship the size of a twig, patches of sparkling blue, and a face or a skull flashing by. The interiors were as dark as caves. My ears, fed by headphones, were filled with such details as the chafing of hawsers and feet stomping on straw, but there below me Johnny Depp and Orlando Bloom were duelling like two angry mosquitoes in a jar.

January 03, 2007