More on the iTunes Pricing Fight

After iTunes saves market, music companies chafe at pricing [pdf]

Now, however, some labels feel hamstrung by Jobs’s insistence on pricing all tracks at 99 cents. With the labels expected to enter into music licensing discussions with Apple this year, any moves by Apple to abandon uniform pricing will test whether music fans are willing to pay more to download music that many acquired for free only a few years ago.

”The labels really want to be able to boost up the price for downloads on new releases,” said Matt Kleinschmit, a digital music analyst with the Ipsos Insight market research firm. ”The question is: Are we at a time now that we want to experiment with variable pricing?”

Recording labels make about 70 cents per download, but could pocket significantly more by increasing retail prices by just a few cents.

[…] Last fall, Edgar Bronfman Jr., chief executive of Warner Music Group Corp., suggested that Apple should allow different download prices for songs and even give the labels a cut of iPod sales.

[…] Jobs has argued that recording companies already make more profit by selling a song through iTunes than on a CD, which carries extra marketing and manufacturing costs. ”So if they want to raise the prices, it just means they’re getting a little greedy,” he said at Apple Expo in Paris in September.

The push by labels reflects an industrywide scramble to reap the most from a business model that only three years ago seemed unlikely to survive amid overwhelming online piracy.

Virtual Theft in China

China stands by verdict on virtual property thief [pdf]

China has upheld a guilty verdict and fine against a man who stole and sold players’ games IDs and online equipment amid growing calls for more concrete virtual property laws, state media said on Monday.

A court in Guangzhou, the provincial capital of China’s southern province of Guangdong, dismissed an appeal by Yan Yifan, 20, found guilty of selling stolen passwords and online equipment from 30 players of the online historical quest game, “Da Xihua Xiyou,” last year.

[…] More and more virtual property disputes are being brought before China’s courts, prompting calls from intellectual property rights lawyers for more strongly defined virtual property laws, the China Daily reported.

The Guangzhou ruling follows a suspended death sentence delivered to a Shanghai online game player last year for stabbing a competitor to death for selling his virtual cyber-sword.

More on the Claria Foray Into Clickstream Monitoring

E-Commerce Report: Every Click You Make, They’ll Be Watching You

WOULD you trust a company enough to let it follow your every click online?

Claria, a company once vilified for raining pop-up advertisements across the Internet through its Gator software, is betting its business that the answer is yes. Claria said it would announce Monday the release of PersonalWeb, a service that will let people download a piece of tracking software and receive a home page filled with news stories and other information tailored to their interests.

[…] Claria says that because those ads are so closely aligned to the user’s interests and recent behavior, marketers will be willing to pay more than they might on other sites for the ability to reach PersonalWeb users.

That part of Claria’s plan is convincing enough for some analysts, and privacy advocates appear satisfied that Claria will stand by its pledge to track only the computer (whose owner it does not identify), not the personal information of the user. Whether many consumers will use the service anyway — and give marketers an audience worth pursuing — is the big question.

“I’m not convinced that consumers will place enough of a value on personalization that they’ll be willing to download a piece of software and change their home page just to try it,” said Kenneth Cassar, an analyst with Nielsen/NetRatings, an Internet consultancy. “And it remains to be seen whether Claria’s personalization will yield something that much better than the typical home page of today.”

[…] “Claria’s likely to make a lot of people uneasy when they realize how much of their personal life is exposed through their Web surfing,” said Marc Rotenberg, executive director of the Electronic Privacy Information Center, an advocacy group.

While other companies are stopping short of asking consumers to expose their complete surfing habits, they are considerably more interested in personalizing their sites for consumers than they were a few years ago, said Michael Strickman, chief technology officer of ChoiceStream, which helps companies like Yahoo, America Online and others personalize the products or content they show to consumers.

Media Competition: New Paradigms or Just Reemergence of Old Ones?

Death by Smiley Face: When Rivals Disdain Profit

There is another breed of rival lurking online for traditional media, and it is perhaps the most vexing yet: call it purpose-driven media, with a shout-out to Rick Warren, the author of “A Purpose-Driven Life,” for borrowing his catchphrase.

These are new-media ventures that leave the competition scratching their heads because they don’t really aim to compete in the first place; their creators are merely taking advantage of the economics of the online medium to do something that they feel good about. They would certainly like to cover their costs and maybe make a buck or two, but really, they’re not in it for the money. By purely commercial measures, they are illogical. If your name were, say, Rupert or Sumner, they would represent the kind of terror that might keep you up at night: death by smiley face.

Probably the best-known practitioner is, the online listing site. Although it is routinely described as a competitor with — and the bane of — newspaper classified ads, the site is mostly a free listings service that acts as a community resource.

DataPoint: Disruptive Technology (2)

Composing Music Using Apple Computer’s GarageBand Software

I’M not a musician, but I recently composed and recorded a song. More than that, in a Paul McCartneyesque fit of post-Beatles hubris, I played all the instruments and produced and engineered the entire thing, even though I have no experience producing and engineering anything more complicated than a Bombay martini.


There’s just one thing: I didn’t compose “Eventide” any more than Ashlee Simpson sang “Pieces of Me” on “Saturday Night Live.” The song sprang from computer-sampled snippets of musical instruments that I stitched together using Apple Computer’s GarageBand software. GarageBand is a denatured version of industry-standard recording software that allows amateurs to cobble together a song using nothing but the program’s digital instruments. You preview the samples from a Chinese-menu-like array, drag them into a virtual mixing console, push them this way and that, and voilà! The software automatically renders the composition into a tidy audio file that can be posted to Web sites like, which teems with thousands of MP3 files from would-be Coldplays and Alicia Keyses.

The process is so seamless and absorbing that I can’t really recall how “Eventide” came together. […] It was like watching a Polaroid photograph develop, except that I could fuss with the image as it came into focus. By then I had stacked up seven instruments I didn’t know how to play into a song I didn’t know how to write.

Given my total inexperience at composing, the result should have sounded ridiculous; instead, it sounded pretty cool. […]

DataPoint: Disruptive Technology

For all who though that Dean was somehow a one-shot deal: Internet Injects Sweeping Change Into U.S. Politics

This means, aides said, rethinking every assumption about running a campaign: how to reach different segments of voters, how to get voters to the polls, how to raise money, and the best way to have a candidate interact with the public. In 2004, John Edwards, a former Democratic senator from North Carolina and his party’s vice presidential candidate, spent much of his time talking to voters in living rooms in New Hampshire and Iowa; now he is putting aside hours every week to videotape responses to videotaped questions, the entire exchange posted on his blog.

“The effect of the Internet on politics will be every bit as transformational as television was,” said Ken Mehlman, the Republican national chairman. “If you want to get your message out, the old way of paying someone to make a TV ad is insufficient: You need your message out through the Internet, through e-mail, through talk radio.”

Michael Cornfield, a political science professor at George Washington University who studies politics and the Internet, said campaigns were actually late in coming to the game. “Politicians are having a hard time reconciling themselves to a medium where they can’t control the message,” Professor Cornfield said. “Politics is lagging, but politics is not going to be immune to the digital revolution.”

If there was any resistance, it is rapidly melting away.