At Date: Wed, 23 May 2007 22:00:43 Bob wrote:

>Jaimie, what I was getting at was this: the price iTunes charges per song 
>doesn't entice anyone I know to download whole albums' worth of songs on a 
>regular basis . I know a few who will stump up for the odd song now and 
>again, but that's it.  Do any Auditeers download albums from iTunes 
>regularly?   I can't remember  exactly how many songs you can fit (on 
>average) onto a 30GB iPod - is it 15,000 or so?  If so, that means it would 
>cost $15,000 dollars to fill your iPod, assuming you bought all the music 
>from Apple.
>
>Say an average album has 10 tracks - that means $10 to download it.  By 
>your reckoning, you would see $8.60 of that.  How does that compare with a 
>CD?

It doesn't work that way. If you want the WHOLE album there's a price point 
for that too....it's the equivalent to 10 songs max. If the album has 15 
songs....you get it for the 10 song price. Maximum a consumer pays for a 
whole SINGLE album's worth of tracks is $9.99. Balk at it all you want, but 
that's a hell of a better deal than $15.99 to $24.99 at retail for the same 
thing (regardless of the extra packaging/booklet).

>I suppose what I am saying in essence is that I agree with the guy in the 
>Chicago Tribune article - 25 cents does seem a fairer price for me to pay 
>for mere downloads as opposed to CDs.   And if Apple charged a quarter of 
>the current price, would they then maybe sell more than 4 times as many 
>tracks?   I don't know the answer to that of course, all I am trying to do 
>is tell it from a consumer's viewpoint (my own and people I know).

Guess you missed the conversation that kicked off the eMusic debate. In a 
nutshell:

iTunes CAN'T sell it for $0.25 because there would be zero profit. 
Mechanical royalties alone are $0.085 per download paid to songwriters right 
off the top. That would leave $0.165 per download to divvy up between the 
label/artist and iTunes. It would take hundreds of thousands of downloads 
per song just for anyone to make enough money to register a viable revenue 
stream (iTunes, the label AND/OR the artist). Volume sales in this case is 
inconsequential because there's so much music that few acts would be in the 
upper tier where that many downloads would occur.

If I agreed to such a ridiculously low cost from which iTunes takes their 
mandatory 13 to 15% and my broker gets another 10% for digitizing and 
administering my material (independent acts and labels cannot deal with the 
large portals direct -- the MUST have a broker/aggragate as middle 
man....though 6 labels opting out of eMusic are doing so to start their own 
brokerage firm and avoid the middle...by BECOMING the middle man, but I 
digress).....we'd make $0.132 per download....which is split in half with 
our acts AFTER their debt is recouped. Bullseye maintains one of the highest 
artist royalty rates in the industry for artists, BTW.

100,000 downloads of one track at that rate would net approximately $13, 
200.

This number is improbable. In fact, the average download of an independent 
track, even a popular one, resides below 500 downloads over a 5 year period 
(which is all the data that exists so far for the download industry). That's 
$66 in 5 years for one song.

With the current iTunes model we net $310 over 5 years per song. And that's 
still not enough to keep my business afloat, you dig?



Jaimie Vernon,
President, Bullseye Records
http://www.bullseyecanada.com

SWAG:
http://www.cafepress.com/bullseyecanada
BULLSEYE LIVE 365 RADIO:
http://www.live365.com/stations/bullseyerecords

Author, Canadian Pop Music Encyclopedia
http://jam.canoe.ca/Music/Pop_Encyclopedia/

http://www.myspace.com/jaimievernonsmovingtargetz

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