930 Forums
=> GENERAL DISCUSSION => Topic started by: markie on September 04, 2003, 11:13:00 am
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iTunes eBay auction 'treads murky legal ground'
September 3 - 19:55 EDTÂ Â In a move that could test the legalities of Internet music resale rights, George Hotelling on Tuesday night put a digital song he purchased on Apple's iTunes Music Store up for auction on eBay. "Hotelling said he isn't all that concerned about getting his money back for the song, 'Double Dutch Bus,' which cost him 99 cents," reports CNET News.com. "Instead, he said he's using the attempted sale to probe some thorny consumer issues stemming from commercial online music services, in particular, technology known as digital rights management that's used to prevent unauthorized copying."
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linkage?
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http://JUST FOR BOmBaY DoDORs (http://www.macminute.com/)
HE NevEr TrusTS mE (http://news.com.com/2100-1025_3-5071108.html)
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I wanted the ebay link?!
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I believe it is in the second link.
But the second linked article says that the auction contravenes ebay rules of supply of services over the internet, so it will get pulled.
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Hmmm, but what's interesting is that the iTunes files are limited to playing on designated computers, and only up to three.
Apparently you can burn them on CDs as often as you like, but I couldn't put my Yeah Yeah Yeahs purchase on a data CD as MP3s.
Even beyond the legal issues, wonder how all this works.
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Originally posted by bags:
Even beyond the legal issues, wonder how all this works.
Its something to do with why they switched from MP3 to AAC files.
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I don't get that MP3/AAC issue. I'm really, really bad with computer stuff, though I have a MAC, iTunes and iPod (which is why I'm bad; I don't need to know much!).
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Originally posted by bags:
I don't get that MP3/AAC issue.
MP# and AAC use different compression algorhythms. But AAC also keeps track of copies that are made of itself. That way it can limit the number of copies made in some ways.
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Who makes the money on digital downloads?
http://www.business2.com/subscribers/articles/mag/0,1640,49472,00.html (http://www.business2.com/subscribers/articles/mag/0,1640,49472,00.html)
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Originally posted by ggwâ?¢:
Who makes the money on digital downloads?
http://www.business2.com/subscribers/articles/mag/0,1640,49472,00.html (http://www.business2.com/subscribers/articles/mag/0,1640,49472,00.html)
Want to read more? You need to be a subscriber!
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Originally posted by Anton Newcombe:
Originally posted by ggwâ?¢:
Who makes the money on digital downloads?
http://www.business2.com/subscribers/articles/mag/0,1640,49472,00.html (http://www.business2.com/subscribers/articles/mag/0,1640,49472,00.html)
Want to read more? You need to be a subscriber! [/b]
Well that's odd.
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WHO GETS WHAT
The MP3 Economy
How labels and artists divvy up your MP3 dollar.
By Nancy Einhart, June 2003 Issue
The going rate for downloading songs from online music services like Apple's (AAPL) iTunes Music Store, MusicNet, Pressplay, and Rhapsody is about $1 a pop. Yet the economics of recorded music sales haven't changed much since the vinyl era -- despite the fact that digital files cost very little to produce and distribute. So how much of your buck makes its way back to the artists? Not much, though it's clearly a better deal than they get from piracy.
The Site's Cut (40%)
The biggest chunk of your dollar goes to the online music provider. This explains why sites like Rhapsody can offer promotional discounts: When you buy a song for 49 cents, the site sacrifices its profit but the label still gets paid.
The Publisher's Cut (8%)
This sliver goes to the music publisher in the form of "mechanical royalties," the amount paid to license the written music. While other fees can vary from artist to artist, mechanical royalties are always a flat-fee transaction.
The Label's Cut (30%)
The record company receives "performance royalties" that are paid to license an actual recording (not the written music). That explains why some performers, like alt-rocker Aimee Mann, run their own labels -- it allows them to keep a larger share of these royalties for themselves.
The Middlemen's Cut (10%)
A small portion is reserved for various other intermediaries. Sites like Liquid Audio, MusicNet, and Rhapsody often sell their services through secondary distributors like Amazon and AOL, so they, too, get a cut.
The Artist's Cut (12%)
Twelve percent is average, but successful bands often hammer out better contracts. In many major-label contracts, charges for "packaging" and promotional copies are subtracted from the artist's cut, leaving the talent with a measly 8 percent. BMG, Universal, and Warner have announced plans to do away with such deductions for digital downloads.
<img src="http://images.business2.com/images/mag/jun2003_30b_143x330.jpg" alt=" - " />
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thanks GGW.
So bands would do well to sell their own MP3s from their own site. There is more money to be made from being a retailer. But thhat has always been the case. How much do stores make on a CD, I would wager that it is at least 40%, and more like 50%-60%.
does itunes really take 40% of the cut? somehow I thought it was a smaller amount.
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Originally posted by Anton Newcombe:
does itunes really take 40% of the cut? somehow I thought it was a smaller amount.
'Tis true. Your beloved Apple is just another money-grubbing corporation.
Originally posted by Anton Newcombe:
How much do stores make on a CD, I would wager that it is at least 40%, and more like 50%-60%.
If you go by the new Universal pricing policy, retailers mark-up albums 43% over the wholesale price.
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Originally posted by ggwâ?¢:
'Tis true. Your beloved Apple is just another money-grubbing corporation.
If you go by the new Universal pricing policy, retailers mark-up albums 43% over the wholesale price.
I know apple is there just to make money, but it hardly ever makes much of a profit, despite having $4 billion in the bank.
Where do you get the universal pricing policy from? And If that is the case why is tower $5 more expensive than nice record store?
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Originally posted by Anton Newcombe:
Where do you get the universal pricing policy from? And If that is the case why is tower $5 more expensive than nice record store?
Current: Wholesale - $12.02; MSRP - $18.98
Mark-up = 58%
Proposed: Wholesale - $9.09; MSRP - $12.98
Mark-up = 43%
http://story.news.yahoo.com/news?tmpl=story&cid=495&ncid=689&e=1&u=/ap/20030904/ap_en_mu/universal_music_cds (http://story.news.yahoo.com/news?tmpl=story&cid=495&ncid=689&e=1&u=/ap/20030904/ap_en_mu/universal_music_cds)
Retailers can charge whatever they want. Tower thinks they can get a higher price because they're Tower. Of course, they're closing stores left and right now.
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Originally posted by ggwâ?¢:
Retailers can charge whatever they want. Tower thinks they can get a higher price because they're Tower. Of course, they're closing stores left and right now.
Oh, thanks GGW.
So no wonder record shops have such a hard time with such a modest mark-up and the huge value of stock they have to keep on the floor.
Most other retail establishments seem to run on trying to double or treble the wholesale price. I guess that is all tower is tring to do. I thought with their bulk purchasing they would access cheaper prices from the labels.........
maybe tower isnt evil afterall.
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Originally posted by Anton Newcombe:
I thought with their bulk purchasing they would access cheaper prices from the labels.........
maybe tower isnt evil afterall.
Big stores get rebates from the labels for advertising. Labels also pay for spots on the listening stations. I would assume they also pay for placement in those racks at the end of the aisles.
But Tower, unlike Best Buy and Circuit City, probably can't run a loss leader on CDs as a way of luring you into the store in the hopes that you buy a high-margin stereo and a mega-margin "extended service plan."