Universal announces plan to lower CD prices to under $10. Too little too late?
Universal Music Group has announced a plan designed to lower the prices of CDs to $10 or less. Apparently they've clued in that the things are too expensive.
Billboard.biz (found via Rolling Stone) is reporting that Universal plans to test lower CD prices ranging from $6 to $10.
Billboard says, "To accommodate the lower pricing, UMG labels also plan to step up deluxe versions of albums that can sell at higher prices for the more devout music fans and collectors. UMG is also banking that the lower price points will at the least be offset by increasing CD sales volume."
It's not yet clear when it will begin.
"We think [the new pricing program] will really bring new life into the physical format," Universal Music Group Distribution president/CEO Jim Urie reportedly said.
The new pricing structure will apparently carry a 25% profit margin, "which means that $10 list CDs will wholesale for $7.50; $9 for $6.75, $8 for $6, and so on." And so, says Billboard, retailers who buy from wholesalers will likely be not so enthusiastic about the move.
Billboard also says execs at other majors are nervous and annoyed. Oh, those dinosaurs. So hard to teach them new tricks, even on their way to extinction.
Interestingly, the article mentions $10 as the magic price point, which will get consumers to buy more CDs, pointing out that iTunes retails albums for $9.99.
Seems logical. Buuuut...see, the thing about iTunes is you don't have to leave your house. It's so easy. And, while some may prefer the actual physical disc complete with jewel case, I think many of us are equally pleased with digital copy that doesn't pile up and collect dust. Because, when you have a lot of cds, those things are everywhere.
I actually live in a divided household, in which my husband buys CDs and I download everything. So relieved to be storing it on the computer! He never even balks at price and will pay $30-$40 for a disc while I don't think I'd buy one for $5 if I could get it online with decent sound quality.** And did I mention his CDs are everywhere?
So, will the move actually make a difference in my house? Probably not. I'm not going to go back to buying physical copies. How about you? Will you buy more CDs if they're cheaper?
Posted by Elizabeth B.
**By which I mean buy it on iTunes, where you "download" things. That's how you buy them. Sorry. Didn't realize that needed explaining. Anyway, "filesharing," which is something else, though it still involves "downloading" is technically not illegal in Canada, last time I checked (or so I understand it). But that's a fuzzy area and a WHOLE other discussion. To wit: "downloading" is not synonymous with "stealing."
Universal Music Group has announced a plan designed to lower the prices of CDs to $10 or less. Apparently they've clued in that the things are too expensive.
Billboard.biz (found via Rolling Stone) is reporting that Universal plans to test lower CD prices ranging from $6 to $10.
Billboard says, "To accommodate the lower pricing, UMG labels also plan to step up deluxe versions of albums that can sell at higher prices for the more devout music fans and collectors. UMG is also banking that the lower price points will at the least be offset by increasing CD sales volume."
It's not yet clear when it will begin.
"We think [the new pricing program] will really bring new life into the physical format," Universal Music Group Distribution president/CEO Jim Urie reportedly said.
The new pricing structure will apparently carry a 25% profit margin, "which means that $10 list CDs will wholesale for $7.50; $9 for $6.75, $8 for $6, and so on." And so, says Billboard, retailers who buy from wholesalers will likely be not so enthusiastic about the move.
Billboard also says execs at other majors are nervous and annoyed. Oh, those dinosaurs. So hard to teach them new tricks, even on their way to extinction.
Interestingly, the article mentions $10 as the magic price point, which will get consumers to buy more CDs, pointing out that iTunes retails albums for $9.99.
Seems logical. Buuuut...see, the thing about iTunes is you don't have to leave your house. It's so easy. And, while some may prefer the actual physical disc complete with jewel case, I think many of us are equally pleased with digital copy that doesn't pile up and collect dust. Because, when you have a lot of cds, those things are everywhere.
I actually live in a divided household, in which my husband buys CDs and I download everything. So relieved to be storing it on the computer! He never even balks at price and will pay $30-$40 for a disc while I don't think I'd buy one for $5 if I could get it online with decent sound quality.** And did I mention his CDs are everywhere?
So, will the move actually make a difference in my house? Probably not. I'm not going to go back to buying physical copies. How about you? Will you buy more CDs if they're cheaper?
Posted by Elizabeth B.
**By which I mean buy it on iTunes, where you "download" things. That's how you buy them. Sorry. Didn't realize that needed explaining. Anyway, "filesharing," which is something else, though it still involves "downloading" is technically not illegal in Canada, last time I checked (or so I understand it). But that's a fuzzy area and a WHOLE other discussion. To wit: "downloading" is not synonymous with "stealing."
