iTunes Tracks May Increase in Price

By Ed Oswald, BetaNews

November 16, 2005, 12:51 PM

For several months now, the record industry has become more and more vocal over the issue of pricing on the iTunes Music Store. On Wednesday, the first indications of a possible variable pricing structure coming to iTunes became apparent.

The Wall Street Journal reported that EMI Music CEO Alain Levy told attendees of a London press conference that he had held talks with Apple CEO Steve Jobs over the issue.

"There is a common understanding that we will have to come to a variable pricing structure. The issue is when," the paper quoted Levy as saying to reporters. "There is a case for superstars to have a higher price."

Right now, iTunes charges 99 cents for all songs in its catalog. However, the record industry would like to charge more for bigger artists while dropping the price on smaller acts.

But most critics view the demand as an affront to raise prices across the board, while only lowering the price on acts that very few listeners will purchase.

Some smaller labels have gone even further in voicing their disapproval, saying such a move could kill the digital music business altogether and wipe out indie labels that are already struggling in a tough industry.

"My main concern is that if we increase prices now, it obviously isn't going to increase the number of downloads and, in fact, might stall the whole market," David Falman, Managing Director of Odessa Mama Records recently wrote in an guest column featured on BetaNews.

According to EMI's Levy, such a change would likely take place in the next 12 months. Apple's contracts with many of the record labels expire in 2006 and are currently up for negotiation.

Apple has so far not commented on the reports.