Daily Archives: March 4, 2008

Wal-Mart and the Music Companies

It is interesting that there has been much discussion about conflict between Apple and the music companies. Well, Wal-Mart is only going to make life more difficult for them. According to this article, Wal-Mart stirs CD pricing pot with multi-tiered plan – Yahoo! News/Reuters

“The major music companies have been resistant to lowering their price on CDs, but now they may be dragged to that point: Wal-Mart, the largest retailer of music with an estimated 22 percent market share, has proposed a five-tiered pricing scheme that would allow the discounter to sell albums at even lower prices and require the labels to bear more of the costs.According to sources, the Wal-Mart proposal would allow for a promotional program that could comprise the top 15 to 20 hottest titles, each at $10. The rest of the pricing structure, according to several music executives who spoke with Billboard, would have hits and current titles retailing for $12, top catalog at $9, midline catalog at $7 and budget product at $5. The move would also shift the store’s pricing from its $9.88 and $13.88 model to rounder sales prices”

The music companies are caught between a rock (Wal-mart) and a hard place (Apple). This could be an opportunity to see them respond in a better manner than continuing to sue people for downloading free music. Let’s see if they can. Otherwise the future of recorded music will be decided by someone other than themselves.