What Price Music?

As musical recordings have increasingly shed their physical form, the record industry and its customers have been at odds over what it all should cost….The standard charge has become 99 cents a track. Albums that cost between $12 and $18 on CD now sell for about $10 online. And the next months are expected to bring price wars — in both the usual and a more figurative sense of the term.

On RealNetworks’ Rahpsody’s six-week experiment with 49 cent downloads: “Simple logic would say, ‘Well, duh, you’d make more money if you price tracks at 49 cents, or maybe less,'” said Rob Glaser, CEO of RealNetworks. “The problem is you can’t prove to these guys that the 49-cent price does not cannibalize CD sales. The experiment was successful, but the patient was worried about the side-effects.”

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