iTunes Sees Fall in Sales After New Pricing Structure
According to an article published by Digital Music News, the iTunes Store has seen a fall in sales since the introduction of its new variable pricing structure. Executives from top record labels, who have asked for their identities to be kept under wraps, have indicated that the tiered pricing model in force at the iTunes Store now seems to be having a negative impact. Commenting on the recently gathered data, one anonymous executive said, "It's back to the abacus to figure out the best mix."
The iTunes Store's new system has three price points for purchasing music tracks, which are $0.69, $0.99, and $1.29. Although this seems like a sensible spread of prices on the surface, in practice the new model is looking flawed. For example, if you want to purchase songs for $0.69, then they are practically non-existent, which makes a mockery of the new system. Looking at the top-end of the pricing scale, asking $1.29 to download top selling tracks, such as Boom Boom Pow by Black Eyed Peas, seems way off base considering you can get the same track from Amazon MP3 for $0.99.
It's still early days at the moment to say for sure if sales will continue to decline, but with a growing marketplace of more affordable online music services, it could be a trend that is set to continue - unless the top record labels dust off their abacuses once more and come up with a fairer and more competitive formula.
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Comments
You had to believe that iTunes sales would drop – it was inevitable. 20 cents may not seems like a lot more, but when you keep buying songs at that price, it quickly adds up. And with the way the economy is, people are trying to find ways to save money. Saving 20 cents here and there will quickly add up! Besides that, Amazon also has tons of other great deals like their $5 Friday deals and their daily mp3 deals which usually is around $2 or $3 for an entire album. You need to be patient and wait for albums you want, but its worth it to save money while still building up a nice collection. I use the following page to track their daily deal (the mp3 deal is the first listed one):
http://www.frugalgadgets.com/