By: Arthur Cooper
Submitted: 2011-03-08 03:24:42 | Word Count: 664
According to a Bloomberg report, Apple has been negotiating an agreement with major record companies to enable music purchasers to be able to download music unlimitedly. The key record labels involved are Sony Music Entertainment, Universal Music Group, Warner Music and EMI. These four companies control about 99 percent of the music we buy and listen to everyday. The problem is based on the fact that in the current format, if you purchase and download a song from iTunes, you can only have access to that song via the particular device that you are using.
As Apple increases its market share of devices with music playback ability, there is more of a demand for unlimited downloads for each device. When you download a song to your iPod, you must purchase it again to download it to your iPhone or iPad, costing users more and more money. No one wants to pay for a song more than once. Apple wants to ensure that users of any one of their devices can play whatever song they have already paid for or songs that they will purchase on multiple devices. Apple is no doubt worried that some of their products have and will become obsolete. If you have to buy music for each device, users may just choose to use one.
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The record companies involved have a huge decision to make. They will likely choose a path that they view to be the most profitable. I wonder if this is a collective negotiation or if each record company will decide on an individual basis. This could be a problem for users who will then have to figure out which songs are unlimited and which ones are not. Music companies and artists will want to compete on a level playing field with each other. Songs that are available unlimitedly will surely be more enticing for users to purchase.
The results could go either way for the record companies. If they decide to allow multiple downloads per purchase, they stand to lose money. There are so many Apple product users that rely on having music on each of the devices that they own. Users that may have purchased a song a couple of times will no longer do so. If the record companies decide not comply with Apple’s request, they may see a decline in sales via iTunes as users have other options for getting their music fix. There are other methods of listening to and acquiring music, some are even free. Now that users have so many Apple devices, they may give up on the idea of downloading music altogether.
In recent times the music industry has seen a decline in album sales across the board. They have desperately been trying to hold on to old methods of gaining profits and creating innovate ways to do the same. Many recording artists have turned to digital formats to remain relevant and maintain their financially stability. I’m sure that iPod, iPad and iPhone users will be overjoyed if this deal is successfully brokered.
