Is ITunes Succumbing To The Music Industry's Death Wish? - InformationWeek

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Is ITunes Succumbing To The Music Industry's Death Wish?

I can't decide whether Apple's announcement yesterday that it's going to sell DRM-free songs at variable prices is a good thing, or a really dumb idea.

I can't decide whether Apple's announcement yesterday that it's going to sell DRM-free songs at variable prices is a good thing, or a really dumb idea.The music companies haven't figured out what to do about digital transmission. It's not because they're stupid, or haven't tried to innovate or, for that matter, haven't produced some notable and directionally-intriguing successes. They know that the very structure of their companies, from office facilities to people and processes, depends on consumers buying a lot of packaged content (well-known artist), via a packaged good (CD), for use on a dedicated technology device (player).

They also know that their business model is kaput, and that nothing they do translates well into the new world of digital everything.

iTunes was the rare example of how to make the transition. It was easy to use, song offerings were configured to earn customer loyalty, and the consistent $.99 price built a sense of trust. The fact that iTunes works seamlessly with iPods meant that the deal was actually better, faster, easier, and cheaper than buying CDs. And it made money, although not as much as the labels wanted.

So they lobbied to break it.

Now a variety of players and gizmos can vie for the songs downloaded via the iTunes store, totally blowing up the simplicity and ease-of-use brand benefits. More important, customers will encounter the same bass-ackwards pricing model that hopes to exploit customer need instead of rewarding it (by charging higher prices for new releases, which is no more strategic than Gap stacking sweaters with price tags that every consumer knows will have a red line drawn through them in a matter of weeks).

Such approaches give brands bad names, or at least lessen their value.

We can debate the abstract issue of DRM on entertainment content -- as I'm sure we will in the comments to this post -- and I know that a lot of people plainly just don't like the fact that Apple had sort of cornered the market with its digital distribution solution. I'll even give on the idea that albums are "total concepts" of artwork, even though I don't really believe it.

But are the changes to iTunes really going to help anybody, or are they examples of the music industry inflicting its death wish on an otherwise healthy service?

Jonathan Salem Baskin writes the Dim Bulb blog and is the author of Branding Only Works On Cattle.

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