The Bleak Numbers in Selling Digital Music in UK

(sub. req.): In an otherwise famliar story on iPod/iTunes etc, FT breaks out some figures on the margins in digital song sales in UK: “In the UK, online sales delivered from an EU-based computer server are also subject to 17.5 per cent VAT. A further 8 per cent is payable to the MCPS and the PRS, the bodies which collect song-writing royalties. If, as expected, UK downloads are widely priced at 99p a go or less, as on UK site mycokemusic. com, which sells them from 80p, then retailers are looking at running a small-margin, high-volume business to cover their start-up costs and turn a profit. Selling downloads in greater volume or together with other products would spread the overhead, but the outlook is tough for small music retailers which plan to invest in the area but lack Apple’s marketing clout or user base.”

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