James Delahunty
3 Oct 2005 12:57
Apple's iTunes is once again coming under fire from the same music industry that thanked it just two years ago for providing a real alternative to P2P piracy for consumers. This time it is artists' managers and royalty collectors that are taking a shot at iTunes. The belief basically is that Apple is not properly re-compensating artists. The Music Managers Forum (MMF) is complaining about the 4.5p performers receive from 79p download sales at iTunes in the UK.
That's about 6% of the cost of the download, less than half what the performers get from single sales on physical media. “Sale prices and royalties have gradually been eroded to the point where an artist needs to sell in excess of 1.5m units before they can show a profit, after paying for recording time and tour support," Jazz Summers, MMF chairman and manager of Snow Patrol, told the Times newspaper. Also the Mechanical Copyright Protection Society (MCPS) and the Performing Rights Society (PRS) want to increase the royalties for writers to 12% from the 8.5% rate of today.
Recently, Tim Clark, co-founder of ie:music, said that iTunes was only giving artists about 3-4p for every music download. However, is Clark complaining about the right people? Actually he is not. iTunes, Napster, Wippit, Virgin etc. are all just retailers whereas performance royalties are negotiated by labels and artists' managers. Summers however understand this fact and said that the record labels had been caught with their pants down when they accepted the pricing policies put forward to them by Apple.
He believes the labels accepted it due to fear of the massive amounts of illegal music sharing on the Internet. We reported also last month that Edger Bronfman, Warner Music CEO, said that Apple's prices were unfair and that the company should open up to variable pricing models instead of the current 99c (79p) pricing policy being safe guarded by Apple. He was responding to comments made by Steve Jobs that accused the labels of being greedy by wanting to increase the price of music downloads.
Jobs warned that such a move would be enough to push many of the legal music downloaders back to P2P networks to download music free again.
Source:
The Register