Indie labels plan to pull out of digital service (EMusic)

Bizarre! To the guys at those labels: it's not eMusic ist's the USERS who are demanding these prices per song, and therefore impacting how much you are making. Ask THEM to pay you more - not eMusic. iTunes pays more because IT SELLS IPODS on the back of your music, and therefore does not care to make real $ with selling it. Wake up and smell.... the flat rate, which is your best possible future.

Indie labels plan to pull out of digital service - Yahoo! News.

Victory Records' Tony Brummel first raised the issue in early April when he pulled his catalog from the service after eMusic introduced the Connoisseur Plan, which offers existing customers 300 downloads a month for $75 -- or about 25 cents apiece. The most eMusic subscribers pay per track is 33 cents under its plan that charges $10 per month for 30 downloads.

After factoring in distribution costs and other expenses, some labels receive as little as 12 cents per song in profit, sources say -- far less than the 60 cents to 65 cents per track received from iTunes.

The service counts more than 13,000 indie labels as partners, and, at the moment, complaints about the revenue share seem constrained to a disgruntled few

Comments

[Simon Higgs]

@ frank: you completely missed my point. My comment about rentals is about consumer attitudes to subscription services. Archival and storage is less important if next month's subscription allows you to buy/rent/download exactly the same songs all over again like on-demand radio. It doesn't specifically apply to eMusic. Also, I have read the eMusic contract and this isn't about competition for the consumer. It's all about competition & choice for the label making a decision about which online music stores to work. Big (huge) difference.

[frank]

@ simon: emusic's flat rate is not a rent rate. their customers own the songs the buy. obviously you don't know emusic's buisiness model. a little research before commenting wouldn't do any harm.

[frank]

@ simon: emusic's flat rate is not a rent rate. their customers own the songs the buy. obviously you don't know emusic's buisiness model. a little research before commenting wouldn't do any harm.

[Jonny Goldberg]

I am an avid fan of eMusic and their excellent service, like most of the indie music community and I suggest everyone go read what their CEO David Pakman has posted in response to this, a really terrific read - go check it out now on the eMusic blog at:

http://17dots.com/2007/05/07/its-a-brave-new-world-out-there/

[Simon Higgs]

It's eMusic that determines eMusic's pricing. Plus the iPod is a big fat red herring. The revenue from iTMS and iPod are separate. Sure the iPod services a fractional proportion of the music sold in iTMS and there is synergy but it's not a deciding factor (and what was the figure Jobs quoted? - 22 songs sold per iPod sold).

Out of the 99 cents the consumer pays for a track, iTunes makes around 29 cents per download (less a 5 cent affiliate commission if applicable). When eMusic grosses less than 33 cents per download before it splits revenue and pays out to the labels, who exactly is kidding who?

Consumers want to buy their music outright DRM-free. They don't want to rent the same music over and over each month. Flat rate is an old worn out 78rpm.