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Claire Bennet and the rest of the Heroes gang may be leaving iTunes
NBC Universal says "good-bye" to iTunes

Apple is very protective of its iTunes store and the pricing model used to distribute music and video. That tight grip over pricing has caused NBC Universal to break ties with Apple.

NBC Universal will not renew its contract with Apple to sell TV shows on iTunes. Popular NBC Universal shows made available on iTunes include "Heroes," “30 Rock” and "The Office." In fact, NBC Universal is currently the number one provider of video downloads on iTunes and accounts for 40 percent of video downloads (roughly 1,500 hours or programming).

NBC Universal's two-year contract ends in December, so content will still be available on iTunes until that time. Apple and NBC Universal could still come to an agreement before the end of the contract, but it appears -- for the moment at least -- that neither side is willing to budge on the matter.

NBC Universal feels that it should receive a larger cut of iTunes downloads and have the ability to package content together. Apple on the other hand has stood its ground with regards to pricing and contends that packaging video content would lead to confusion for buyers and decrease demand.

This isn't the first time that Apple has run into pricing issues with one of its content providers. In July, Universal Media Group decided not to renew its iTunes contract over similar pricing concerns.

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RE: About time!!
By akugami on 8/31/2007 1:32:53 PM , Rating: 2
Considering that it costs the labels, indie or not, a one time production fee to record and produce the song and it costs Apple continual fees to host and provide the song I'm not exactly anti Apple over this.

Don't get me wrong, I'd love for the indies to make a larger amount of the music pie. Maybe we can get some better music going. I have not bought a CD in years though a few songs here and there over the years have been great, which I buy as a single. The fact is 99% of mainstream music simply bores the tears out of me. That's why most people are not buying CD's now. For the few songs they want, they just either illegally download or copy it from a friend or get it through a service like iTunes.

I'm not up to snuff on what costs are incurred by the people producing music but you'd have to rent studio time. Costs of music instruments and hiring any musicians needed to fill in spots that your normal band doesn't play. You can cut out mastering costs since you can keep lossless audio files of your music on a DVD and have a few backups for just in case. Considering technology today, most of the mastering costs and mixing can be done by your band or by the indie label.

This still costs a bundle but it's greatly reduced so that indies can survive. Unlike back in the day when it was almost required to be with a major label in order to produce good final copies of your music. I'm sure there are other costs involved but I would think that most of the costs I've brought up is the majority of what it costs to make a song. The main thing is that even if there are major costs I don't know about, they are almost all one time charges for the most part. So aside from admiistrative costs, once the song is done, it's done. That's how much it costs and that's that.

As for Apple, it costs them time and money to write the software that is Quicktime and iTunes that is required to get the iTunes Music Store running. It also costs money to update and maintain the iTunes store. Not to mention bandwidth costs that they pay out whether they sell a song or not. You might preview half a dozen songs before buying one. Apple has to pay the costs to provide demos of the songs whether you buy it or not. Then when you buy it, they have to pay for the bandwidth to upload the song to you as well.

If sales are bad at Apple, not only do they not make money, they will lose money due to their overhead. For indies, if their songs are not selling well, they may not make any money but they aren't going to go much deeper into the red since the majority of their costs are one time charges.

It's been speculated over and over that Apple makes roughly a nickle to a dime on each 99 cent song. I don't find that unreasonable though I do not know how much the major and indie labels make per song after costs are taken out.

Mom and Pop outfits (selling CD's) were not destroyed by Apple. Large chains such as Best Buys and Wal Mart destroyed them. Adding to the misery was the cheap cost of blank CD's and the proliferation of easy to access, though illegal, music on the internet. Factor in also the mass produced music that I and others find to be absolute donkey crap and you have drops in sales. It's a wonder and testament to the power of the major labels that music sales haven't dropped faster than this.

There is also the fact that if you are not happy with Apple's iTunes, take it and sell it on Real, Walmart, Microsoft or one of the other music stores. There is choice out there. Apple has decided they don't want music to sell for higher than $1, except for the DRM free ones which are $1.29. As a distributor that's their choice. There are other distributors if you are not happy with that pricing model. Or as others have said, make your own indie web store and sell it on your own website for $2 or $3.

I hope you are successful, I am playing devil's advocate to your points and at the same time, I genuinely don't feel that iTunes is destroying music. The record labels have been doing everything they can to drive away customers for years.

"A lot of people pay zero for the cellphone ... That's what it's worth." -- Apple Chief Operating Officer Timothy Cook

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