The National Music Publishers Association wants more money from digital downloads, asking for “9 cents to 15 cents a track – a 66% hike.” Apple pays out around 70 cents per download to record labels — a whopping .09 cents of which goes to the bands. What did iTunes vice president Eddy Cue say about this last year?

“If the [iTunes music store] was forced to absorb any increase in the … royalty rate, the result would be to significantly increase the likelihood of the store operating at a financial loss – which is no alternative at all.”

So what might Apple do? Close the iTunes store. They’re the #1 retailer of legal music in the US, and they’re threatening to shut down. And guess what, Mr. Record Label? Apple will still be selling plenty of iPods.

Photo by Tracy Olson.

23 Responses to “Apple Might Close iTunes Store, Laugh At Record Labels”

1. On 10/1/08 2:13 PM, buddy said:

   

   this is quite possibly the funniest thing I’ve ever read on BG. Even the people making the money aren’t making money. God i love music.

2. On 10/1/08 3:02 PM, tAlex said:

   

   Empty threat… Apple needs iTunes to sell iPods.

3. On 10/1/08 3:08 PM, andy said:

   

   But they don’t need the iTunes store…
   peace
   Andy
   went 2 years w/ an iPod before buying an album on iTunes.

4. On 10/1/08 3:29 PM, tAlex said:

   

   I’ve never purchased an album on iTunes and have owned an iPod since 2004. I feel as though they wouldn’t be holding onto 70% of the Digital Music player market share without iTunes.

   They’re working hard to beef up iTunes in order to sell more iPods. How else would you explain the fact that they offer free podcasts? Now everyone with a podcast is directing their listeners to iTunes to get their subscription. There are PLENTY of non-tech savvy people who will think they need an iPod to listen to these.

5. On 10/1/08 3:42 PM, Josh Mock said:

   

   Maybe Apple will just convince all bands to abandon their contracts and sign exclusive distribution through iTunes.

   “Sign with us and we’ll give every member of your band a free iPod!”

6. On 10/1/08 3:50 PM, MikeyS said:

   

   I would never sell my musical soul for an ipod!!

   if it were an iphone, we could talk though

7. On 10/1/08 3:59 PM, tAlex said:

   

   Yeah, and then all bands would have crappy home recorded albums no one would want to buy. Not all bands are like Radiohead and can finance a professionally recorded album.

8. On 10/1/08 4:17 PM, matthew said:

   

   Oh Snap! Good One Seth! Somebody might need to take “the music biz” to the BURN unit. Ouch, yall!

9. On 10/1/08 4:23 PM, matthew said:

   

   hey, where did my freakin gravatar go?

10. On 10/1/08 4:45 PM, andy said:

    

    You don’t need a lot of money to make a great sounding record.

    Actually Josh, that is a great idea. I would sign an exclusive deal w/ iTunes in a heartbeat. They’re like, the only ones who can actually sell music now a days.

11. On 10/1/08 9:29 PM, Seth Werkheiser said:

    

    @ tAlex “How else would you explain the fact that they offer free podcasts?”

    Yea, since all those hipster kids / chicks in Ug boots / Abercrombie & Fitch kiddies are subscribing to podcasts like crazy. Come on!

12. On 10/2/08 6:43 AM, tAlex said:

    

    “Yea, since all those hipster kids / chicks in Ug boots / Abercrombie & Fitch kiddies are subscribing to podcasts like crazy.”

    All those hipsters already have iPods. Apple is probably trying to get the 30+ crowd to stick white ear buds into their ears now since everyone under that already does.

    I work with mostly 40+ people and they are very non-tech savvy. I showed one of my co-workers some podcasts and she went out that same day and purchased a shuffle.

13. On 10/2/08 11:24 AM, Jordan said:

    

    podcasts on shuffle haha.

14. On 10/2/08 12:23 PM, Michael said:

    

    It’s all about the money. Record companies take in too much money as it is and they still want more. Greedy bastards.

15. On 10/2/08 12:35 PM, Jay DiNitto said:

    

    Labels actually lose a LOT of money on most of their roster because there’s no guarantee of return or an even break, even moreso than in other industries. They dole out money and take a huge risk and collect revenue calculated on that risk.

    There’s nothing forcing bands to sign to a label or not stay independent and make the same kind of risks and reaping the rewards on their own. If contracts are so bad then bands shouldn’t be signing them, otherwise it’s their own fault.

16. On 10/2/08 1:09 PM, Jordan Butcher said:

    

    I would be really ok with itunes shutting down. you laze douches would have to get off your butts and go to the record store!

17. On 10/2/08 1:45 PM, Jordan said:

    

    or… the torrent sites. If legal downloading takes this big of a hit I’m sure you’ll see it replaced with even more illegal activity.

18. On 10/2/08 2:20 PM, tAlex said:

    

    I toughly agree with Jay on this one. Labels lose money on 8 out of every 9 albums they release. They get paid a lot but they do lose a lot. When a band cannot recoup their debt, it’s forgiven (ie:don’t have to pay the label back).

    Even hit bands never recoup their debt. Semisonic never broke even with their label despite having the huge radio support of ‘Closing Time’ and going platinum.

19. On 10/2/08 2:23 PM, Cool dude said:

    

    Wow this is sad. The only downloading that can be justified might close. Lost of people will be upset also

20. On 10/2/08 6:01 PM, Lucas said:

    

    The National Music Publishers Association is not the RIAA. this just deals with publishing rights which, depending on what bands sign, the label may or may not have. i can’t stand the recording industry as much as the next guy, but lets not confuse record labels with the NMPA. also, why the hell do people download songs off of itunes anymore when you can download the same song/album(in most cases) for the same price, and it’s DRM free. i say good riddance to the itunes store(for music anyways).

21. On 10/3/08 3:00 AM, Howard said:

    

    They should call Apple’s bluff.
    There’s plenty of money to be made but Apple’s getting all Sopranos on the music biz.
    Would Apple really be doing this if they weren’t making any dough? Doubtful. These are the people who invented giving you the bare minimum for the premium market share and highest profit margin.
    Call their bluff and wait for someone else to say: I’ll take a piece of that!

    If the record biz were as smart as it was EVIL (basically, if it was just… Steve Jobs), they’d have started their own online store and out-promoted iTunes anyway.
    Greedy and lazy? Haha. How’s them 360º deals working out?

22. On 10/3/08 11:49 PM, Lucas said:

    

    i just realized i didnt mention that i was referring to the amazon mp3 store in regards to the drm free downloads.

23. On 10/4/08 11:50 AM, Sergio said:

    

    The NMPA’s request was shot down.

    Let’s all celebrate by downloading the new P!NK single.

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