Blog Post

$10,000 LPs Now Playing at the iTunes Store

itunes_lp_10000Introduced by none other than Steve Jobs at the Apple Music Event last month, the iTunes LP adds content like lyrics, liner notes, animation, and video interviews to the traditional album for a little more money, at least for the consumer. It turns out Apple (s aapl) is charging artists $10,000 in production costs for creating an iTunes LP.

That’s what Brian McKinney of indie label Chocolate Lab Records told Gizmodo. McKinney sought information on how one went about making an iTunes LP, and it was relayed to him from an iTunes Store representative that “LPs aren’t being offered to indies and that there are only about 12 LPs being offered right now.” And that Apple is charging $10,000 in production fees.

If that sounds a tad high for your average indie band practically living out of the back of a van, perhaps that’s why there are so few iTunes LPs available a month after format was introduced. To contrast that with another Apple initiative, the App Store, it opened with 500 apps, and less than a week later had nearly a thousand.

If you are looking for a rationale as to why it’s impossible to put together some songs, videos, and lyrics for less than $10,000, don’t look at me. AppleInsider has some steroidal-strength apologia on the topic, though, something about “quality assurance” and that Apple doesn’t “want the new format associated with music the mainstream market doesn’t care about.” It will be great later, though, “open standards” and all that. Let’s hope so, because right now it looks like Apple is channeling the ghost of Sony’s proprietary standards past.

When Steve Jobs introduced the iTunes LP, he remarked that “some of us here are old enough that we actually bought LPs.” Some of us also remember sifting through boxes of LPs in record stores for hours and the joy of finding new music unlike anything we’d heard before. Unless Apple changes its policy, you’ll never have to worry about losing yourself among the virtual LPs at the iTunes Store.

18 Responses to “$10,000 LPs Now Playing at the iTunes Store”

  1. Scarhawk

    The only reason these LPs exist is that Steve Jobs promised the major labels some help in selling more full albums, since the mp3 single is rapidly killing the album model. It’s an attempt to create something proprietary that the labels can lock up with DRM and sell for a premium price. If the format takes off, you can bet that the hottest tracks will be locked up inside these albums for some exclusivity period before they become available as mp3 singles (if they do at all). Labels get to force you to buy whole albums again, Apple gets to force you to buy a newer iPod/iPhone that supports them.

    The $10,000 is just Jobs’ way of saying to the labels, I’ll create your stupid format, and I’ll make money on it either way. If it sells, Apple gets its percentage, and if not, Apple still gets a big fee. Since the indies aren’t really complaining to Apple that they want DRM back, they’re not in on the deal. Maybe the majors hope to charge the indies a licensing fee for using the format.

  2. I just don’t get people’s outrage on the price. Have you ever outsourced web development. A web developer makes about 80K per year throw in perks and the company pays 100K per year with 2000 hrs of work that is 50 per hour or with overhead maybe 150 labor hours. I have no idea how long it takes Apple to put an LP out but they are basically a self contained web site so if the indie group has a web developer on the cheap I’m sure down the road they will be able to produce an LP. I don’t think Apple will stay in the LP creation business, but since they created the standard they are providing the service to early adopters.

  3. Adam Jackson

    In my opinion, Apple should charge that much for a few reasons. they’re #1. If the app store is any example, the iTunes LP will be flooded with thousands of these things and some may be crap or buggy. i’m guessing Apple is paying people to internally to work with labels to create custom CSS w/ HTML5 standards iTunes LPs that are attractive and appealing.

    The 10K entry fee is something that we can scoff at but it filters out the people who might waste apple’s time. Yeah, it’s easy to bitch about Apple closing out the indies and smaller labels but iTunes LP, in my opinion is a waste of money and is never going to do very well. If the 10K at least keeps teh quality high with groups that are mainstream, the format might survive longer than my personal estimates.

    iTunes LP is a waste. I got it for free by purchasing the jay-Z BP3 deluxe album and it’s a waste. I’m not gonna use it

  4. Ask your local web guy to put something like this together and see what costs. Probably more than $50. For Apple, or any big company to do it, it’s a reasonable cost. But Apple doesn’t say you can’t have someone else put it together for you. So indie labels who are savvy enough can still do it themselves for a lot less.

    $10K will get you one day in a top recording studio, so this is small change to big companies.

  5. iTunes LP is for free for the customers, so I think it should be a little cheaper for the artists to create such a LP. But for the bigger artists it shouldn’t be a problem. When a studio for 1 month costs 300.000$, 10.000 is nothing : P

  6. If you really want to kill the format, just make it a $10… $5 upcharge just to play a format nine out of ten users won’t give half a crap about. Ten grand isn’t so bad compared to the cost of running off a set of lushly-packaged vinyl.

  7. ok, and just what do you guys think would be the average going rate for a company of Apple’s stature to charge for putting together something as slick and in depth as the iTunes LP’s that are available right now? This is clearly a case of major music labels being offered the opportunity to have one of their albums be one of the first of this kind, and therefore probably get massively more downloads because of the new novelty of it. They can afford to pay that fee, and it’s probably worth it to them. It makes sense for Apple not even to offer this to small indie artists initially because A) they know they can’t afford the current development cost and will therefore feed the anti-apple arguments and B) they don’t have such broad appeal and therefore won’t sell well and return the investment from both the artist and apple.

    Give it time. After these initial pilot albums Apple will provide tools for indie artists to build their own LP’s and there will probably just be a small fee at most for the added bandwidth, hosting, etc.

    Just my opinion..

  8. iTunes is still one of the best thing to happen for indie labels, I sure as heck have found a lot more indie stuff because of that. I don’t see the big deal that they don’t get the high sheen polished options that an established artist gets. That’s the benefit of being an established artist, you have the funds to put together things like the LPs. Cause frankly, $10,000 isn’t really a whole for an established artist to put together (assuming it’s a one time fee). I don’t even think it’s remotely bad. If they were charging that much to get on the store, then it’d be a problem. But it’s for a special feature on the store that isn’t intended for every artist under the sun.

    Yes, it’s higher for an indie label, but why would they want that anyway? I don’t mind buying a few tracks from a band I’ve never heard of, but I’m not going to buy an entire LP from them.

  9. Why is Apple even producing this content at all. They aren’t a content company, they’re a software and media distribution company. Charging $10,000 in “production costs” will likely guarantee the death of the format. It’s quite likely that a number of these LPs will probably never even make $10,000 for the course of their entire lifetimes. So, why would a label or group then put up the money to create one? Simple answer: they probably wouldn’t.

    It would be much better if they really were using open standards (better yet, open source it) and then took a percentage of sales. Let individual companies produce the LP content. The major labels do have departments that specialise in this sort of thing. And if Apple has concerns about quality, they could then reject them at the time of distribution.

    But this is Apple we’re talking about and in Apple land things don’t necessarily have to make sense.