What I find interesting (in a sad way) is that the music business and the cell phone business just don't get it. They seem to be looking at old economic models and stand in the wasy of technological advancement. Do you make more money selling 100 songs for $2.50 or 500 songs for $0.99?
... Sprint and the record labels have decided to spoil their breakthrough service by setting a stratospheric new price for the legal download of a single song: $2.50. That's 2.5 times the 99 cents that Apple and others charge on their online stores for a better-quality version of the very same song. Right now, Sprint is offering the first five downloads free, but starting with the sixth song, the $2.50-a-song price kicks in. The charges show up on your cellphone bill.Ok, I can sort of understand charging $2.50 for a song because there are some capital costs the need to be recouped AND the record companies need to be paid, but that's not what they're using for justification. They're using the convenience factor argument. However, buying a hot dog at Fenway Park for $3.00 is no a simple convenience, it's necessary if you want to each a hot dog and watch the Red Sox. You can't bring your own. (Though that does bring me back to that Oscar Meyer commercial of the 70's where the father pulls a hot dog on a bun out of his briefcase and hands it to his son. Let's have a weiner roast, you don't have to build a fire, all you need is Oscar Meyer...)
Sprint says its higher price is justified by the convenience factor, the ability to buy a song on the go, when the impulse strikes. The company compares this to paying more than usual for milk at an all-night convenience store, or for hot dogs at a ballpark. Also, Sprint contends, there are many people who find PC-based music stores too hard to use, and they will be willing to pay more for something simpler.
I believe something else is at work here: a lethal combination of two industries many consumers believe typically charge too much. One is the bumbling record industry, which has been seeking to raise prices in the fledgling legal downloading market even as it continues to bleed from free, illegal downloading. The other is the cellphone carriers, or, as I like to call them, "the Soviet ministries," which too often treat their customers as captive and refuse to allow open competition for services they offer over their networks.
Anyone else wnat to comment on the stupid statement that a cell phone based music store is easier to use or simpler than a computer based store like, I don't know, ITMS? I know there are other stores out there whose interfaces aren't as good as the one iTunes has, but really, how bad of a designer do you have to be to lose out to a cell phone? I just don't buy it. If you can't figure out how to use a music store on a computer, I really don't think you have the cognitive skills to use one on a cell phone much less buy the right phone and purchase the right service. I don't think there's much of a "dumb people" market for Sprint|Nextel to tap into. Then again, people do pay $2.99 for ringtones, which are, for all intents and purposes, parts of songs.
Also, if you want that song you just downloaded onto your cell phone on your computer? You need to download it again (no extra charge!!) ON YOUR COMPUTER which was too difficult for you to use in the first place. Hmmm. Your're dumb, just dumb enough to buy our crap!
The high costs don't stop there. The new music store can be accessed -- so far -- on only two new high-end phones, from Sanyo and Samsung, which cost more than $200, even after rebates. Even then, if you want to store more than about 32 songs on your phone, you'll have to spring for a larger memory card, which costs anywhere from $25 to $100. You have to pay at least $15 a month for a data plan that allows you just to access the music store, though you also get other services.I really don't think I will be buying one of these phones. Besides, I am an online music success story! I've purchased more music from iTunes in the past year than I had CDs or Vinyl in my life. I'm saving the record labels tons of money on distribution. They should thank me.
Now get out of my pocket.