Thoughts on Digital Music

One thing I’ve disliked about online music sales is the price.  At first, 99 cents for a song seems like a bargain.  But, when you start purchasing a lot of songs, it starts to add up.  Buying an album on iTunes is almost the same price as buying a CD!  Why on Earth would you buy an album on iTunes when you could get the CD for almost the same price?  A CD would free you from the effects of DRM and give you a physical copy, all in better quality than iTunes.  The only situation in which it makes sense to buy songs on iTunes is when you’re buying a single.  The situation is still the same when you’re buying from other online services, such as Amazon.  Even though Amazon has no DRM, the tracks are still compressed.  If you buy a CD, you have the tracks in an uncompressed format.

This isn’t the merchant’s fault either; it’s the record labels fault.  They are getting the most profit from the online music sales, somewhere in the neighborhood of 70 cents per song.  The rest of the money goes to bandwidth and other costs associated with selling music online.  This gives the merchants only a few cents profit.

Think about it.  The current 80 GB iPod Classic can hold up to 20,000 songs.  That’s twenty-thousand!  Going by the iTunes store price, that would cost you around $20,000 to fill up.  Nobody is going to pay $20,000 to fill up their iPod!

If the record labels would stop demanding so much of the money from each song sold, I bet they would sell many more songs.  If the price of a song was only 33 cents, people would buy much more.  The record companies would make up for the lost profit in no time because sales would rapidly increase!  Three songs for a Dollar!  That sounds great!  Not to mention the reduction in piracy.

I think that the record labels will eventually realize that 99 cents is too much.  Give it a few years and I think things will become more reasonable.  Eventually people will stop buying CDs and just download online, once the price is right and the process is simple enough.

Apple Releases New iPhone and iPod Touch Models

Today, Apple announced the availability of two new products.  The first is an upgraded iPod touch that has 32 GB of storage space.  The second is a new iPhone that has 16 GB of storage.  Both new models are priced at $499.  The only changes in these devices are the storage capacities, everything else remains the same.  These new products are available now and should be arriving in stores in a few days.  The lower-capacity versions of these products (the 8 and 16 GB iPod Touch and the 8 GB iPhone) do still exist, though they incurred no change in price.

The upgraded capacity of the iPod touch should make some people happy, as it makes the iPod Touch a strong competitor to other portable video players.  Before, with only 16 GB of space, despite being a beautiful device with a very nice screen, the iPod Touch couldn’t hold much content.  But now, with the upgraded 32 GB, the iPod Touch now has more than sufficient storage for movies, music, and more.

The upgraded capacity on the iPhone is nice too, but I’d still like to see new features added, such as 3G and Flash support.  I suspect that an upgraded iPhone with these features will make an appearance later this year, but we’ll just have to wait and see.

One thing that bugged me was the fact that Apple didn’t reduce the price of the lower-capacity iPod Touch models.  $399 for the 16 GB iPod Touch isn’t cheap, and $250 for an 8 GB version isn’t great either.  Similarly priced competitor models exist with more storage (namely the Archos 604 with 30 GB of storage), thus making the iPod Touch a less-attractive buy.

Maybe Apple will reduce the prices of these models, in the same way as their infamous iPhone price cut.  Or maybe they won’t.  We’ll just have to wait and see.

Amazon MP3 Store Gets Even Better

Amazon’s MP3 store has grown quite a bit since its initial launch back in September. At first, due to their DRM-free nature, they didn’t have the support of all of the Big 4 record labels. But when Sony BMG declared that they would begin to offer their music on Amazon without DRM, Amazon finally got the boost they needed to start dominating digital music sales. They now offer a vast majority of music from all of the Big 4.

You might be thinking, “Well, iTunes is doing this already, so what’s the big deal?” Well, Amazon has a few key advantages over the iTunes Music Store. First, the prices are the same or in some cases lower than iTunes. Second, Amazon’s store is compatible with all MP3 players, due to its music being in the universal MP3 format. Third, Amazon offers higher quality files than iTunes, with music files encoded in 256 kilobit MP3, verses iTunes paltry 128 kilobit AAC. Fourth, Amazon’s store is easier to access than the iTunes store. Since it’s web-based, you can get to their store from any computer with just a web browser and start downloading instantly. You can’t do that with iTunes, since iTunes requires you to download a program to browse its store. This will open up the music downloading world to a vast amount of people who previously would not have downloaded digital audio files, either because they don’t own an iPod or for some other reason. There’s no reason to download content from the iTunes Store if you don’t own an iPod, right? That’s not the case with the Amazon store.

As if that wasn’t enough, Amazon has now said that they are going to acquire Audible. This will make Amazon your one-stop shop for all your audio needs. This, combined with Amazon’s excellent Unbox Video service, will make Amazon a force to be reckoned with in the digital media realm.

Since Amazon is going to acquire Audible, you can probably say goodbye to Audible downloads on iTunes. iTunes is really going to take a beating from Amazon because of all this. If I were Apple, I’d be scared.