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.

Advertisements