"Justin Ulysses Morse" wrote in message
...
George wrote:

My general experiance is that making things cheaper does not make
them more profitable maybe more affordable but not more profitable
at 99 cents this is well below what the market will support, we just
need to have a product people find value in when you can still "file
share " music what is the point in paying for it stopping free file
sharing should be the highest priority in the music industry at this
time only once we stop giving away what is not ours to give will
people reluctantly begin paying what it is worth

This is not what's happening at all though. There's no shortage of
people paying for downloads. Jobs wasn't lamenting a lack of business.
He was only saying that he wasn't making a net profit on that business.

only once we stop giving away what is not ours to give will
people reluctantly begin paying what it is worth

Wrong, it has proven to be the other way around. Only once they
started charging money for what people want did they stop taking it for
free. It's true there are still people filesharing but that has not
been an obstacle to the success of paid downloads whatsoever.

I disagree
I ALWAYS look for the freeware or share ware before shelling out for the
full price version it works the same for music
george

I ALWAYS look for the freeware or share ware before shelling out for the
full price version it works the same for music

Right. It's called radio, video, personal appreances and TV appearances by the
artists.

Add to that the listening station at many retailers.

There are many ways to preview music before deciding to buy.



---------------------------------------
"I know enough to know I don't know enough"

Hey, how a company makes its money isn't always obvious. McDonald's doesn't
make anything on hamburgers; they're basically a soda stand selling burgers as
loss leaders to make people thirsty.

Peace,
Paul

"EggHd" wrote in message
...
So now it's time to pass the savings to the artists that make the music
happen.

Explain.


If the cost of distribution is near zero, and in the case of electronic
distribution that's the case, then artists contracts should reflect that.
I'm under the impression that while a record company may save money on
'e-distribution', the artists are actually seeing less of the proceeds from
it.

jb

EggHd wrote:

I believe it bodes very well. THRY have cut out the traditional retail store.
THEY don't have to do artwork etc.

People are still doing Art, but you have an option to download it or not.

PLUS they are mainly selling catalog which
makes it even more profitable.

Everyone sells mostly catolog don't they?

--
Cheers and All
Nathan

" Elementary chaos theory tells us that all of Cakewalk will eventually turn
against their masters and run amok in an orgy of blood and kicking and the biting
with the metal teeth and the hurting and shoving."
-Professor Frink

"EggHd" wrote in message
...
So now it's time to pass the savings to the artists that make the music
happen.

Explain.


Oh, nevermind. 12 percent is pretty good, if the itunes scale is comparable.
But it would be interesting to know if this is being held from artists who
haven't recouped costs - the costs here are lower.

jb

reddred wrote:

I believe him. Just imagine the overhead. The music is a promo for ipods.
What's wrong with selling ipods?

Nothing is wrong with it. But the overhead of online music sales is very small
compared to ramping up for a hardware run. It maybe that hardware has a more
obvious revenue/fixed cost flow than music does, which in turn might be a bit
more attractive to Apple.
But I think something else is afoot here, and it smells like a accounting move
to adjust for the stock holders at the quarters close.
--
Cheers and All
Nathan

" Elementary chaos theory tells us that all of Cakewalk will eventually turn
against their masters and run amok in an orgy of blood and kicking and the
biting with the metal teeth and the hurting and shoving."
-Professor Frink

But it would be interesting to know if this is being held from artists who
haven't recouped costs - the costs here are lower.

How can a label recoup costs that aren't there?



---------------------------------------
"I know enough to know I don't know enough"

In article writes:

Hey, how a company makes its money isn't always obvious. McDonald's doesn't
make anything on hamburgers; they're basically a soda stand selling burgers as
loss leaders to make people thirsty.

I guess that's why sodas cost more than the hamburgers, and why when I
ask for a cup for water, I get one about the size of a shot glass.



--
I'm really Mike Rivers - )
However, until the spam goes away or Hell freezes over,
lots of IP addresses are blocked from this system. If
you e-mail me and it bounces, use your secret decoder ring
and reach me he double-m-eleven-double-zero at yahoo

"EggHd" wrote in message
...
But it would be interesting to know if this is being held from artists
who
haven't recouped costs - the costs here are lower.

How can a label recoup costs that aren't there?


My point exactly.

jb

Do you think this Apple move might have a negative effect long term on
the industry?

I was thinking of the selling soda analogy above and wondering appart
from Ipods what Apple can sell along with music... and then I thought,
you cant see a picture of Mariah Cary on an Ipod...

Sex sells....

Can you sell sex on an Ipod?

MP3 players with "picures" or videos HAVE to be next.

Cheery thought! People get mugged al the time for cel phones here in
Europe, I wonder if Imuggers will emerge, the white headphone cords
are a dead give-a-way.

Toodles!

Arny Krueger wrote:

"reddred" wrote in message

"Kurt Albershardt" wrote in message
...
Nathan West wrote:

Artie Turner wrote:


Now this is sad: even at 99 cents per tune, Jobs can't show a
profit with online music. I had high hopes for iTunes, but it
looks like the music has just become a gimmick to sell iPods and
sugar water.


I don't believe him for a minute. He would of know the deal going
into it before he signed Apple to be a distributor. Maybe he is
looking for a write off and is setting it up now.

Maybe he's looking to discourage potential competitors from entering
the market?


I believe him. Just imagine the overhead. The music is a promo for
ipods. What's wrong with selling ipods?

I believe that this analysis agrees with the ones currently being published
in the business trade magazines. Apple is setting up a new line of
business - portable media players. They need a legitiamte source of program
material for their players to play.

And King Gillette is rolling in his grave.
--
Les Cargill

Justin Ulysses Morse wrote:

Les Cargill wrote:

I just odn't think he had a lot of margin left, after paying for the
Internet infrastructure to support iTunes. Same error as always - people
underestimate the plant costs.

I didn't get the impression that Jobs ever underestimated anything. He
said that there's no money in online distribution. He didn't say he
just found this out though.

Point well taken.

My understanding is he knew going into the
deal that it wasn't a money maker, but that he could sell a giant pile
of iPods if he made content for them widely available. Which is what
he's doing.


So he's giving the blades away, and selling the razors? Ummmm....

ulysses


--
Les Cargill

Andrea wrote:

(EggHd) wrote in message ...
Royalties for the song composition itself
are something around 7¢ a song. Credit card fees are what, 3 or 4%. So how
much are the royalties for the recording?

The artist royalty will be the same % they normally get. 16 to 24% depening on
the deal the artist made (and how much leverage they had when making the deal)

Either:
1. the record companies are making out like bandits

What is the apple cut and the record company cut? Remember this is just a
another retailer. the record company still has to market the record to the
public, the single most expense in the record biz.


---------------------------------------
"I know enough to know I don't know enough"

Here is the link to that pie chart, Apple, according to the pie chart
was supposed to get 40% of the 99cent downloads, the artist only gets
12%.

Who did Apple forfeit thier 40% share of the proceeds to?

http://www.deeperwants.com/cul1/home...es/001645.html

It is a horrible,inhumane,and sucky deal for the artist to only get
12%, without the artists, they would have nothing to sell.
Andrea

12% isn't bad ROI for anybody, even if the artists contributed 100% of
the capital to get it. A good accountant can lay out all the capital as
expenses, which are like promissory notes on other revenue.

--
Les Cargill

reddred wrote:

"EggHd" wrote in message
...
So now it's time to pass the savings to the artists that make the music
happen.

Explain.


If the cost of distribution is near zero,

.... if only...

and in the case of electronic
distribution that's the case, then artists contracts should reflect that.
I'm under the impression that while a record company may save money on
'e-distribution', the artists are actually seeing less of the proceeds from
it.

I think this remains to be seen.


jb


--
Les Cargill

Do you think this Apple move might have a negative effect long term on
the industry?

It's a new type of retailer. The industry is already hurting from piracy so
this can only help.



---------------------------------------
"I know enough to know I don't know enough"

(Tom Paul) wrote in message . com...

[Magnatune rules]

I really hope magnatune a lot of success in starting a new path to the
market.

Well, I've bought a couple of albums from them and plan to buy more.
No bogus DRM, nice choice of formats, fair pricing, good karma -- what's
not to like, aside from wishing for a bigger catalog?

Preview tracks are the key to sales, I think. Baen Books seems to think
freebies are good for book sales too:

http://www.baen.com/library/

They've been doing it for years now, so it must be working for them.
One of the points they make is that there will always be a place for
editors since they perform a valuable service in separating the wheat
from the chaff. Music publishers, if they are truly doing their jobs
instead of just trying to cash in on the next trend, have a place too
for the same reason.

-DrBoom

In article ,
(Julian Standen) wrote:

MP3 players with "picures" or videos HAVE to be next.

Once you get to the point where memory is cheaper and more efficient I
think it is inevitable that you'll have a sitution where you'll be
downloading some new file format that has the audio AND a video of some
kind to go along with it.

I think you're absolutely correct that audio/video iPod-style delivery
is the next logical step.

When I can work out on the stairmaster at my gym while watching "U2 Live
From Boston", that'll be a really cool day.

CT

In article ,

Andrea wrote:
It is a horrible,inhumane,and sucky deal for the artist to only get
12%, without the artists, they would have nothing to sell.

I'm sure egghead will address this better than I could, but 12% is HUGE.
I'd be thrilled to get 12% of the money when Apple has to deal with
marketing (through the iTunes website and advertising in other media)
and distribution.

What comparable music-distribution deal can you point to where an artist
gets more?

CT

In article ,
(EggHd) wrote:

Do you think this Apple move might have a negative effect long term on
the industry?

It's a new type of retailer. The industry is already hurting from piracy so
this can only help.

Amen.

Again, I think too many people forget what they're comparing. The
comparison isn't "iTunes or buying the CD in a store". Those days are
gone. The comparison is now "iTunes or download it illegally for free".

Which do you think is better for the music industry?

CT

Charles Thomas wrote:
In article ,

Andrea wrote:

It is a horrible,inhumane,and sucky deal for the artist to only get
12%, without the artists, they would have nothing to sell.


I'm sure egghead will address this better than I could, but 12% is HUGE.
I'd be thrilled to get 12% of the money when Apple has to deal with
marketing (through the iTunes website and advertising in other media)
and distribution.

What comparable music-distribution deal can you point to where an artist
gets more?

I'll admit I'm not familiar with the terms of the iTunes/Big Labels
deal, (I'm not sure the terms were made public) but the way Steven St.
Croix described it in a recent Mix, Apple just paid a big lump sum up
front to use a limited part of the labels' catalogs.

How the labels redistributed that lump sum to the individual copyright
owners/artists is anybody's guess.

AT

CT

I'm sure egghead will address this better than I could, but 12% is HUGE.
I'd be thrilled to get 12% of the money when Apple has to deal with
marketing (through the iTunes website and advertising in other media)
and distribution.

I'm only going by what I am reading which is not that complete.





---------------------------------------
"I know enough to know I don't know enough"

Actually there's probably more than enough money to go around, once the idea
comes about that there's more music out there than the majors represent.
Let's face it, in times of old would Britney have sold 23 million albums?
Today would the Beatles have sold 23 million albums? It depends on what's
being hyped, doesn't it? If we start talking about indies going million
sellers then we'd be talking about something. And then there's probably
some money in it, as Mr. Jobs seems to argue against.

Yeah, what's needed is an all ecompassing distribution method and yes, just
as certainly, it doesn't include all the majors anymore. After all, since
they aren't signing up new talent, they don't any longer have the strangle
hold on new talent, and they have a specific amount of time that their
copyrights still hold. The beginning of the end for the majors, and I
daresay, the beginning of music as artists. A true beginning of musicians
as artists. No contracts and no patrons. Everybody gets to say what they
want.

--


Roger W. Norman
SirMusic Studio
Purchase your copy of the Fifth of RAP CD set at www.recaudiopro.net.
See how far $20 really goes.




"Justin Ulysses Morse" wrote in message
...
Roger W. Norman wrote:

"Justin Ulysses Morse" wrote in message
...
The trick to making this thing profitable will have to be cutting out
the middle-men, or at least reducing the cut that goes to the middle
men.

So you'd relegate Apple to an Indie label distribution house? You can't
cut
out the middleman on Bruce Springsteen or Little Richard unless they've
recouped their rights to the songs, as in the Eagles members thing about
their songs. So if you bypass the majors, you don't have major artists,
or
you have catalog that is old and been through the "another format" wars
so
much that people no longer want to purchase. Makes no sense to me to
even
view the problem that way.

What about new artists who haven't gotten themselves entangled with a
label yet? Couldn't they become "major artists"? And I wasn't
necessarily suggesting that Apple specifically cut the labels out. Why
couldn't the labels cut Apple out? The point is there isn't enough
money to go around when you have this many interested parties. But
there are still a whole lot of interested parties that are essentially
dead weight.

ulysses

Exactly.

--


Roger W. Norman
SirMusic Studio
Purchase your copy of the Fifth of RAP CD set at www.recaudiopro.net.
See how far $20 really goes.




"EggHd" wrote in message
...
What about new artists who haven't gotten themselves entangled with a
label yet? Couldn't they become "major artists"?

If they have the resources to market their releases. The ITunes store is
just
that. A store is not a marketing and promotion company.

The good news is that there is no restriction on shelf space. The bad
news is
there is no restriction on shelf space.



---------------------------------------
"I know enough to know I don't know enough"

Sex sells....

Can you sell sex on an Ipod?


That would be killer. I'm for it all. Mobile sin box. Then I can
take my stolen music AND porn everywhere I go.

The iPod possibilities go on and on and on. It's a hard drive, very
compact, tough, with a really slick little interface. It could
eventual act as a music player, address book, pocket recorder, web
browser, video player, camera, video camera, etc.

I believe those profit margins. Apple isn't in the music biz, they're
a computer company. They are selling little hard drives. It's very
simple.

-bh

reddred wrote:

If the cost of distribution is near zero, and in the case of electronic
distribution that's the case


Whoah, hold on there. People talk about the thieving record labels
greedily taking $16 for the sale of a CD and only giving $1 or whatever
to the artist, because they're failing to consider the $8 that goes to
the retail store (which in turm pays employees), the truck drivers and
warehouse workers, the manufacturing and printing and promoters etc. I
think you understand this. You don't seem to realize that the online
distribution scheme costs money too. A lot of money. All those
dot-coms wouldn't have gone belly-up if they didn't have any expenses.
Aside from the obvious things like hardware and administration and
networking, you've got the promotion costs. The cost of promoting a
band and a record and a company haven't gone away, and now they've got
the cost of promoting a brand-new distribution technology on top of
everything else. And what do you think it costs to build and run a
website capable of delivering a million or more secure, paid 3MB
downloads in a week? That's at least 15 terabytes monthly. That's an
insanely large bandwidth. You don't call up Roadrunner for a
connection like that. Remember they're doing the work that a worldwide
P2P network has been doing, not including the payment handling.

ulysses

Justin Ulysses Morse wrote:

What about new artists who haven't gotten themselves entangled with a
label yet? Couldn't they become "major artists"?

Only if their "fans" think it makes sense to pay for music, instead of
P2P'ing it because it's supposed to be "free". That mioght turn out to
be a problem.

--
ha

This is out of online distro, but check out The Stones, a huge brand name
promoting a huge brand name DVD 40 Licks DVD.

The Stones are doing this themselves only going thru Best Buy so there really
is no distribution just pack and ship to one chain.

Have you seen what they are spending on advertising?

Full page ads in major market newspapers, radio and TV advertising, they must
be spending 3 million or more.

Even the Stones can't take a new piece of product and put it out somewhere
without letting their fans know it's there.

Think about the rest of us.


---------------------------------------
"I know enough to know I don't know enough"

EggHd wrote:

Full page ads in major market newspapers, radio and TV advertising, they must
be spending 3 million or more.

Brand management is expensive. Toys R Us spends more than that on Take Out during
a marketing session.

Even the Stones can't take a new piece of product and put it out somewhere
without letting their fans know it's there.

Neither can Pepsi or Macdonalds.

Think about the rest of us.

The Stones are competing against Shania and the like....just not most of us. I'm
sure Dave Mathews gives them an itch or two as well. It comes down to knowing
your market, your budget, your supporters, and your banker.

--
Cheers and All
Nathan

" Elementary chaos theory tells us that all of Cakewalk will eventually turn
against their masters and run amok in an orgy of blood and kicking and the biting
with the metal teeth and the hurting and shoving."
-Professor Frink

Brand management is expensive.

It is.

The Stones are competing against Shania and the like....just not most of us


That's everyone's competition going into the marketplace.

It comes down to knowing
your market, your budget, your supporters, and your banker.

Exactly. How many units can you sell and what should you spend marketing to
the audience. It's same for everyone.




---------------------------------------
"I know enough to know I don't know enough"

"Justin Ulysses Morse" wrote in message
...
reddred wrote:

If the cost of distribution is near zero, and in the case of electronic
distribution that's the case


Whoah, hold on there. People talk about the thieving record labels
greedily taking $16 for the sale of a CD and only giving $1 or whatever
to the artist, because they're failing to consider the $8 that goes to
the retail store (which in turm pays employees), the truck drivers and
warehouse workers, the manufacturing and printing and promoters etc. I
think you understand this. You don't seem to realize that the online
distribution scheme costs money too. A lot of money. All those
dot-coms wouldn't have gone belly-up if they didn't have any expenses.
Aside from the obvious things like hardware and administration and
networking, you've got the promotion costs. The cost of promoting a
band and a record and a company haven't gone away, and now they've got
the cost of promoting a brand-new distribution technology on top of
everything else. And what do you think it costs to build and run a
website capable of delivering a million or more secure, paid 3MB
downloads in a week? That's at least 15 terabytes monthly. That's an
insanely large bandwidth. You don't call up Roadrunner for a
connection like that. Remember they're doing the work that a worldwide
P2P network has been doing, not including the payment handling.

ulysses

Maybe I wasn't concise. I understand all too well the costs involved, it's
just a question of who is paying those costs. If the media conglomerates
will no longer be vertically integrated with distribution, and don't foot
the bill for electronic distribution, this has implications for artist
contracts.

jb

If the media conglomerates
will no longer be vertically integrated with distribution, and don't foot
the bill for electronic distribution, this has implications for artist
contracts.

But it's not anything compared to the marketing costs. Many indie labels only
spend 12 to 15% on distribution fees.



---------------------------------------
"I know enough to know I don't know enough"

reddred wrote:

Maybe I wasn't concise. I understand all too well the costs involved, it's
just a question of who is paying those costs. If the media conglomerates
will no longer be vertically integrated with distribution, and don't foot
the bill for electronic distribution, this has implications for artist
contracts.

You'd like to think, but you have to look at the numbers as they're
adding up so far. It'll certainly be different, but I can't say
exactly how at this point. We'll see how it all shakes out.


ulysses

"Justin Ulysses Morse" wrote in message
...
reddred wrote:

Maybe I wasn't concise. I understand all too well the costs involved,
it's
just a question of who is paying those costs. If the media conglomerates
will no longer be vertically integrated with distribution, and don't
foot
the bill for electronic distribution, this has implications for artist
contracts.

You'd like to think, but you have to look at the numbers as they're
adding up so far. It'll certainly be different, but I can't say
exactly how at this point. We'll see how it all shakes out.


ulysses

We'll have to see what present/future model ends up being most succesful.
Apple can sell iPods, that pretty much enables the whole thing, but that may
not be true of other distributors. The thing that looks cool to me about the
deal with Apple is that distribution has become a revenue source in and of
itself as opposed to an expense.

jb

"Julian Standen" wrote in message
om...
Do you think this Apple move might have a negative effect long term on
the industry?

I was thinking of the selling soda analogy above and wondering appart
from Ipods what Apple can sell along with music... and then I thought,
you cant see a picture of Mariah Cary on an Ipod...

Sex sells....

Can you sell sex on an Ipod?

MP3 players with "picures" or videos HAVE to be next.


Cell phones with pictures and mp3 players are here, as are pda's with mp3
players and pictures, as are cell phones with mp3's.... the iPod is a
conservative offer right now in this arena, but it wouldn't be a good
product if there weren't years of future upgrades and slow price reductions.

There is mail, pictures, movies, iDisk access, calendar, it goes on and
on... Apple has been shoveling money into these subscription services (and
servers and bandwidth for them) and it looks like eventually they will all
be accessed from an iPod. Which, most likely, will be the remote for your
television as well.

Music is just the first application that is driving things like media
subscription services and p2p.

jb

The thing that looks cool to me about the
deal with Apple is that distribution has become a revenue source in and of
itself as opposed to an expense.

But the reality is that the artists who are marketed and promoted well will be
the ones that sell.

This is going to be be just another retail chain.



---------------------------------------
"I know enough to know I don't know enough"

But the reality is that the artists who are marketed and promoted well will
be
the ones that sell.

This is going to be be just another retail chain.

Even though my tunes are either now or soon to be up on Rhapsody, Emusic,
AOL-MusicNet, MusicMatch, BuyMusic, AudioLunchbox, the new Napster, and iTunes
(all through CDBaby's efforts in this arena); I have a feeling you're right...
in terms of marketing, it's going to take the $$$ that the majors have to break
through all the noise. I've had varied results from web advertising - some
worthless, some not too bad, none outrageously great; but it'll be interesting
to see if there's any way for an "indie" to break through the clutter on the
sites mentioned above.

NeilH

(all through CDBaby's efforts in this arena)

They are really a class act.

I've had varied results from web advertising - some
worthless, some not too bad, none outrageously great; but it'll be interesting
to see if there's any way for an "indie" to break through the clutter on the
sites mentioned above.

Here's the "problem" with national web distribution. In most cases promotion
and marketing is "local" and reactive to heat in the marketplace.

It's very difficult for an indie act to even think nationally or globally let
alone market that way.

The majors go market by market via radio, touring local press and then take it
nationally when markets start to break.

Take your home market and get heat going there through live gigs, local press
around those and even local specialty radio shows. You can then tell the story
to other markets and get more exposure area by area.





---------------------------------------
"I know enough to know I don't know enough"

The record biz has a very small margin? Oh give me a break. They've
been recycling their old catalog for years... adding a 'unique' cut to
the reconstituted compilations in order to try to get the public to
purchase the same music they own, once again.

On 11 Nov 2003 00:52:59 GMT, (EggHd) wrote:

Maybe he's looking to discourage potential competitors from entering the
market?

Or maybe what's making money for Apple is different than what record companies
make. The record biz has a very small margin.


---------------------------------------
"I know enough to know I don't know enough"

TC wrote:

The record biz has a very small margin? Oh give me a break. They've
been recycling their old catalog for years... adding a 'unique' cut to
the reconstituted compilations in order to try to get the public to
purchase the same music they own, once again.

That's right. The record business has a very small margin. If you knew
something about it you'd know that already.

--
ha