Apple pressures music labels to abandon Amazon MP3 Daily Deal

Posted:
in iPod + iTunes + AppleTV edited January 2014
A new report claims Apple has attempted to push music publishers away from participating in Amazon's MP3 Daily Deal promotion, which features timed exclusives for popular tracks.



According to an executive who spoke with Billboard, the Daily Deal has been around since mid-2008, but it was in 2009, when Amazon asked labels to provide a one-day exclusive before an album's street date in order to be featured in the promotion, that Apple became unhappy. Granting 24-hour exclusivity gave the album promotion across the Web, on various Web sites and social networking feeds.



The labels reportedly paid nothing for the promotion, but simply exchanged the temporary exclusivity for increased exposure. With the deal potentially taking customers away from Apple's own iTunes Music Store, the report said that the iPod maker decided to intervene.



"Sources say that iTunes representatives have been urging labels to rethink their participation in the Amazon promotion and that they have backed up those warnings by withdrawing marketing support for certain releases featured as Daily Deals," the report said.



Apple's alleged approach has apparently worked: Major labels decided not to include high-profile releases such as "Need You Now" by Lady Antebellum and "Animal" by Ke$ha in Amazon's Daily Deal.



The first participant in the Amazon promotion, which started Apple's displeasure, was reportedly Mariah Carey's "Memoirs of an Imperfect Angel," which sold for $5.99 a day before its Sept. 29 street date last year.



Amazon, however, has not been idle as Apple has allegedly become more aggressive with publishers. Bloomberg reported that Amazon has been "fine-tuning its Daily Deal pitch" for new titles, "agreeing, for instance, to forgo the one-day exclusive window on certain ones." Apple, however, allegedly remains upset with the Daily Deal promotion.



A week ago, Apple's iTunes sold its 10 billionth song, achieving the milestone nearly seven years after the online download destination was introduced. Recent figures have found iTunes to represent a quarter of all U.S. music sales, making the service the largest single music retailer in the nation. Digital downloads make up an estimated 35 percent of total music sales, and iTunes accounts for 69 percent of those.



Apple, in the past, has had heated negotiations with music labels over content on iTunes. In early 2009, Apple convinced record labels to remove digital rights management from its music downloads, but in the process it conceded price flexibility. Starting last April, some popular tracks saw a 30 percent increase in price, from 99 cents to $1.29.



As prices were increased in the midst of a recession, annual growth of digital music sales has slowed, but remains a net positive for the major labels. However, one label executive recently conceded that a 30 percent price increase during an economic slump was not the best move.
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Comments

  • Reply 1 of 55
    gfizgfiz Posts: 32member
    So let me get this straight. Apple wants me to pay more for e-books, and not get any daily deals on music from Amazon? Careful Apple, eventually it might set in you're trying to screw me.
  • Reply 2 of 55
    sheffsheff Posts: 1,407member
    Very interesting. For now its Amazon and Apple bullying the music industry, but what if the industry pits them against each other and starts bullying them. Saying things like whoever offers the best deal (takes the least in terms of revenues) will get exclusive content AND an early release. This will start a race to the bottom and will hurt both. Thus increasing prices for us (cause the price of tunes is not gonna go down obviously).



    I'm not saying Apple shouldn't be mad, but they should make deals with Amazon not trying to pressure the music industry into compliance, cause as I said it could turn out bad.
  • Reply 3 of 55
    yesicanyesican Posts: 46member
    Is this thinking BIG as in being the new bully on the block?

    1.) Flash

    2.) eBooks

    3.) Music



    and Apple wonders why Hollywood wants no part of their cloud?
  • Reply 4 of 55
    crebcreb Posts: 276member
    Quote:
    Originally Posted by gFiz View Post


    So let me get this straight. Apple wants me to pay more for e-books, and not get any daily deals on music from Amazon? Careful Apple, eventually it might set in you're trying to screw me.



    I agree entirely. Apple is becoming just like every other large corporation. Climbing in bed with AT&T tells me they are also becoming more political too. (Who knows what lobbyists Apple is hiring these days?) Having been an Apple user for twenty-six years I am keeping my eye out for the new players in tech. I am sure the Apple shills will jump in here shortly and try to convince us that increased prices are a good thing...remember when the record industry transitioned to CDs and how they told us the prices would go down? Apple is effective increasing all the pricing and becoming one of the oligopoly players in the scheme of things.
  • Reply 5 of 55


    Apparently Apple is the new Microsoft.
  • Reply 6 of 55
    woohoo!woohoo! Posts: 291member
    Quote:

    However, one label executive recently conceded that a 30 percent price increase during an economic slump was not the best move.



    Not only that, deviating from the one set price for all songs just tells people a song is good or bad.



    People will naturally try to save money and buy all the good songs, knowing it's going to cost them 30¢ more and avoid the 99¢ songs.



    Before when all the songs were 99¢, people would judge each song and decide, tending to add more songs from a artist they like before moving to another one.



    Now it's easy, just go to each artist you like and only download the $1.29 songs.







    I have over 8000 songs in my library, about 3,500 of them are hit songs, about 2000 are good songs, but not hits, and about 2500 I still haven't rated yet.



    Now if I had a clue ahead of time, I would have likely only bought the 3,500 songs at $1.29 each for $4515.



    Instead I bought all my songs for 99¢ each and spent about $8000.



    No wonder the music industry is losing money. They are fools.
  • Reply 7 of 55
    I love you Apple - but you are showing signs of using your market power in ways not really helping you.



    Sometimes you should let other have their ways and instead let your own quality show the way. You can't have 100% of the market anyway. In this case I think Amazon had a good idea. Apple may feel soar, but don't bully your important source - the music industry. They won't like it in the long run!
  • Reply 8 of 55
    Is this any surprise? Apparently people actually think Apple and Steve Jobs are their friends. Steve Jobs is loyal to Mrs. Jobs, his kids, the shareholders, his dog, and pet turtle, and not necessarily in that order. Grow up and see Apple for what they are. Just another corporation that happens to make pretty good products.
  • Reply 9 of 55
    ghostface147ghostface147 Posts: 1,629member
    Quit being a big baby Apple. One day isn't going to kill iTunes. Get over it. Is Chairman Mao that upset someone took his candy?
  • Reply 10 of 55
    "Sources say that iTunes representatives have been urging labels to rethink their participation in the Amazon promotion and that they have backed up those warnings by withdrawing marketing support for certain releases featured as Daily Deals," the report said.



    Really? I am both not surprised by this (bc that is what business is about) and I am surprised by this (bc it doesn't sound like traditional Apple). Now I am starting to wonder.



    I love the fact that Apple has consistently (and successfully) redefined how business is done in certain markets. But Apple needs to stay focused on the ball and the ball is not becoming 'all world Apple'. Unfortunately companies that have experienced large scale success often cannot resist the temptation of trying to be all things to all people. Moreover, they begin leveraging their power and influence to benefit themselves under the guise of helping the people - which is what Apple is starting to sound like to me. Obviously, they are a profit seeking, publicly traded company - I get that. But I would be greatly disappointed if their business practices began to follow the paths of the traditional mega corporation.



    Maybe it is too late...?
  • Reply 11 of 55
    Quote:
    Originally Posted by Woohoo! View Post


    Not only that, deviating from the one set price for all songs just tells people a song is good or bad.



    People will naturally try to save money and buy all the good songs, blah, blah, blah



    Do you have this post saved some where so you can post it every time AI regurgitates that record executive quote?



    If you're so much of a mindless sheep that you think only the $1.29 songs are good, then you deserve all the crappy songs you own. Or maybe you just have lousy taste in music.
  • Reply 12 of 55
    woohoo!woohoo! Posts: 291member
    Nice personal attack there caliminius. Bye now.
  • Reply 13 of 55
    jeffdmjeffdm Posts: 12,949member
    Quote:
    Originally Posted by caliminius View Post


    Do you have this post saved some where so you can post it every time AI regurgitates that record executive quote?



    If you're so much of a mindless sheep that you think only the $1.29 songs are good, then you deserve all the crappy songs you own. Or maybe you just have lousy taste in music.



    Yeah, price doesn't always correlate so well with quality. However, I bet all twelve of the $0.69 tracks on iTunes aren't worth the asking price.



    The wrangling over three dimes seems a bit much. For most people, I think that $1.29 is going to net hours of play over a lifetime, three dimes seems pretty insignificant compared to that.



    But if the music execs think it's a mistake, I imagine that they still have the opportunity to roll them back.
  • Reply 14 of 55
    dluxdlux Posts: 666member
    Are people that impulsive that they simply have to buy their media the moment it becomes available? (This also applies to movie and TV shows.) I don't agree with Apple trying to manipulate the market, if that's indeed what's going on here*, but this teapot tempest also says something about the buying public who fuels this sort of behavior.



    * Remember all the outrage when it was initially reported that Apple would be charging $10k to anyone who wanted to produce their album in iTunes LP format? Much ado about nothing.
  • Reply 15 of 55
    jeffdmjeffdm Posts: 12,949member
    It sounds petty, but we don't know if it's actually true. Rumors can be manufactured, we don't know who these unnamed people are or how well these sites vet their sources.
  • Reply 16 of 55
    cubertcubert Posts: 728member
    Justice Department meet Steve Jobs.

    Steve Jobs meet the Justice Department.
  • Reply 17 of 55
    freddychfreddych Posts: 266member
    the rumors must be false. apple is a better company than this that cares about it's customers. i know, i have an iphone.
  • Reply 18 of 55
    ilogicilogic Posts: 298member
    Quote:
    Originally Posted by JeffDM View Post


    It sounds petty, but we don't know if it's actually true. Rumors can be manufactured, we don't know who these unnamed people are or how well these sites vet their sources.



    Yeah exactly, who are these folks, how do you know it isn't Amazon itself twisting a half truth in response to it's loss of leverage on the publisher deals going on with Apple's iBook store on the upcoming iPad?



    :deep breath:
  • Reply 19 of 55
    mobilitymobility Posts: 135member
    Quote:
    Originally Posted by Cubert View Post


    Justice Department meet Steve Jobs.

    Steve Jobs meet the Justice Department.



    Doesn't apply here, at all
  • Reply 20 of 55
    Quote:
    Originally Posted by sheff View Post


    Very interesting. For now its Amazon and Apple bullying the music industry, but what if the industry pits them against each other and starts bullying them.



    I guess I'm missing where Amazon is pressuring the music industry. It sounds like Amazon offered the studios a great promotional opportunity and they jumped at it. Not to mention, they've been unhappy with iTunes' lock on the download market. From the article:



    "Granting 24-hour exclusivity gave the album promotion across the Web, on various Web sites and social networking feeds."



    That is pretty much free press for the studios. Amazon's mp3 deal of the day shows up on quite a few deal sites. It's a double whammy for Apple since not only can you get it a day earlier, you get it cheaper than Apple's price (and since it is a day earlier if you happen to have it pre-ordered from iTunes you still have time to cancel your order).



    Personally, I think the studios should tell Apple to F___ off. At the end of the day, if Apple does nothing to promote big new releases it's Apple that gets hurt not the studios. People will just go elsewhere to buy the music. And if it's a major release, it's going to end up in Apple's list of top selling albums and tracks so it's not like Apple can really bury it.



    Quote:
    Originally Posted by Woohoo! View Post


    Nice personal attack there caliminius. Bye now.



    I do what I can. Baaahye.
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