iTunes Tiered Pricing Set for April 7?
The recording industry has had a love affair with the idea of variably priced music for years. As a tool, it’s a way to manage supply or even manipulate demand. If an album (or single) isn’t selling or there’s excess inventory, for example, the price can be trimmed and the bargain used as a lure. If sales are good, or an album is starting to climb a key ratings chart, price adjustments can tweak the momentum.
The practices are common but in the digital world, some retailers have fought against it. For the better part of six years, Apple’s resisted its use at iTunes but that’s changing.
Steve Jobs had originally argued that pricing needed to be “fair” to offset the temptation of downloading a pirated song. Raising prices too high, he argued would drive customers away. He also lobbied that the simplicity of a single price was part of the appeal that’s made iTunes so successful. In 2005, he went so far as to say it was “greedy” of the labels to ask for more.
This past January, Apple shifted course. In what was an apparent horse-trade to bring DRM-free music to iTunes, the company agreed to allow a limited form of variable pricing. As a result of the concession, DRM-Free songs in the future, Apple announced, would sell at one of three prices: 69 cents, 99 cents or $1.29.
That future, according to a new report from the LA Times will begin April 7th. The date’s not been officially confirmed, but sources inside the music industry with a reasonable basis for knowing the details are cited.
It’s not yet clear how the prices will be applied. Apple said at Macworld that more songs would be priced at .69 than $1.29 but, ultimately, the shift will be “based on what the music labels charge.”
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