Media Gets Download Price Increase Story Wrong
Amazon, Wal-Mart Follow Apple,
Raise Prices On Some Top-Selling Tracks
– Washington Post
Amazon Follows iTunes To $1.29
– cNet
Amazon, Wal-Mart Follow iTunes,
Ups MP3 Prices
– PC Magazine
Why'd You Do it Amazon?
– Motley Fool
UPDATED: Mainstream media reporting on variable download pricing and companion
price increases at Amazon and WalMart.com missed the most of the story.
Not only did a much smaller number of tracks at these two retailers rise to $1.29, but virtually all those tracks came from labels owned or distributed by Sony. Unlike UMG, WMG, EMI and others who deliver tracks to digital stores at wholesale for resale, Sony delivers using the agency model. This means that Sony is selling tracks direct to consumers with the retailers just acting as middleman; and as the seller Sony, unlike most labels, can dictate pricing.
Also missed by the media was the fact that, thus far, EMI has chosen not to raise any prices; even on iTunes.
