Royalty Rate Unchanged, Apple's iTunes Safe For Now
Few took the threat seriously, but CNet reports that the Copyright Royalty Board decided to keep royalty rates at 9.1 cents. Music publishers had been pushing for an increase to 15 cents per track, while Apple was insisting that the price increase would not be tolerated by the market.
The 9.1 cents/track rate is now set for the next five years. An Apple spokesperson stated they were very pleased with the decision.
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The three-member board that sets statutory copyright licenses e-mailed the Digital Media Association (DiMA), the National Music Publishers' Association, Apple, and other download stores with its decision to keep the royalty rate at 9.1 cents a song. The board also set the same rate for CDs and established a 24-cent rate for ringtones.
An Apple spokesperson said stated they were very pleased with the decision.
heh, I bet they were.
There is big news in that article - the rates for downloadable songs and CDs may have remained unchanged, but a rate of _24 cents_ has been established for ringtones. :eek:
I don't get it? What is so special about a ringtone? 'Hey, let's buy a 20 second snippet of a song for about 5x the price of the whole song itself'.
I don't get it? What is so special about a ringtone? 'Hey, let's buy a 20 second snippet of a song for about 5x the price of the whole song itself'.
That's what's so special. The fact that it's just a snippet. There's very little additional work for the middlemen, so they're entitled to a smaller cut (even though it's still too big), leaving more for the composer.
Remarkably sensible decision.
*edit* Oh, and the Music Store was never in threat. That statement was Apple's way of saying that they would ensure that any royalty increases would be paid out of the record companies' profits, rather than the music-buying public's pocket.
Seen in that light, leaving the download-able rate untouched seems like rather a poor decision.
Wait, so if a song is $0.99, 90 cents goes to Apple? If not - what exactly is this royalty about?
No, I think apple keeps around 30%. The rest, of which this royalty is a part, goes to the record labels. They then pay this royalty. The problem Apple saw (as I understand it) was that they would be expected to up that 70% to cover the extra royalty but what they really wanted was for the record label to pay the extra out of the 70% they already get.
So, actually, it's the record labels being greedy.
When you ask for a salary increase and your boss tells you is either u keep working for the same money or the street it is for you, and basically there's not many options that offer what u already have u will definitely just shut up and keep working.
In a way good that iTunes have the power to make things stay the way they are I really can't care less how they divide the money people pay por the tracks.
less than that, iTunes is there to persuade people to buy iPods not so much fill their pockets.
I don't get it? What is so special about a ringtone? 'Hey, let's buy a 20 second snippet of a song for about 5x the price of the whole song itself'.
Clearly writing a snippet of a song is much harder than writing a complete song.
Seriously, who is still paying high prices for ringtones, when most phones will just let you use files that you already have?
Sensible decision though, perhaps if they'd asked for a bit less than a 66% hike, they might have got an increase.
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