As soon as today at Macworld, Apple will announce that iTunes is expanding its DRM offering to include all of the major labels and will add variable pricing according to cNet. Over the aor downloads are also part of the deals which were concluded last week. Leaked details appear to match many of the label demands that
Songs will be priced in three tiers: 69-79 cents for older catalog, 99 cents for midline product and slightly higher for some new hit tracks. Depending on how much of iTune's catalog is priced at 79 cents, Jobs may have bested Amazon and WalMart.com who have used price as part of their strategy to whittle away at Apple's dominate 70%+ download market share. How the costs and profits of the price changes will be shared between Apple and the labels is not yet public.
Who Is The Winner?
Labels got higher prices on hit product, but lowered them on catalog. Fans got DRM free msuic and over the air downloads, but have to pay more for hit product.
For two years afer calling for DRM free and over the protests of labels who publically decry his dominance, Steve Jobs negotiated an agreement that should extend his regin. If early reports prove correct, Jobs has trumped the competition with lower prices and broadened the Apple/iTunes/iPod ecosystem to include OTA downloads to the iPhone. Why would music fans want to buy their music anywhere else?
