Text 9420, 102 rader
Skriven 2006-01-28 12:42:22 av Glenn Meadows (1:379/45)
   Kommentar till text 9412 av Rich Gauszka (1:379/45)
Ärende: Re: iPod business
=========================
From: "Glenn Meadows" <gmeadow@comcast.net>

And, when you remove the physical media costs from CD sales, as well as the
distribution costs to get the CD's into stores, and just compare the "content
cost/content revenue", the actual sale of a song via download nets the record
companies less per song than a physical CD sale does.

It's NOT a "windfall" for either side.  I've seen the internal numbers, and
believe me, the record companies WANT to believe that it's more profitable to
sell online. It's just not the case.  There's less revenue coming back in to
support the creation of new talent, or artist development.  That's partly why
the new music is getting fewer choices, people taking fewer chances, because
there's less money to roll the dice with.

It's a very low percentage of released product that recovers the invested
$$$$'s to get it out to the street.

--

Glenn M.
"Rich Gauszka" <gauszka@hotmail.com> wrote in message
news:43db93f5$1@w3.nls.net...
> Last estimate I saw was a profit margin of $0.04 a song and 27 percent on
> the iPod. That would make the hardware end look quite attractive to MS
>
> http://www.redherring.com/Article.aspx?a=15505&hed=Google+May+Sing+iTunes%E2%
80%99+Song&sector=Industries&subsector=EntertainmentAndMedia
>
> Besides, said Mr. Goodman, the online music business-especially
> pay-per-track downloads-is simply not very profitable. The average profit
> on a $0.99 download is $0.04, he said, whereas iPod margins are about 27
> percent.
>
>
>
>
>
> "Glenn Meadows" <gmeadow@comcast.net> wrote in message
> news:43db9005$1@w3.nls.net...
>> John,
>>
>> I've got to side with Rich on this.  Apple does NOT make any appreciable
>> profit on the store.  2/3 of the revenue from the sale of a track goes to
>> the label who owns the copyright (actually it's going up another few
>> percent shortly).  Then from that, Apple has to pay the full staff that
>> runs the store, does all the previewing of the music, etc. Plus, they pay
>> the (Apple pays) the CC processing fees from their portion, as wall as
>> all the bandwidth costs, customer support calls,etc.  And, for most of
>> the majors, they do all the encoding and processing of the new material
>> (at least they did for the first year to get it going).
>>
>> Within the industry, it's fairly well known, that Apple makes virtually
>> nothing on the sale of the music, it's the drive of the content to sell
>> iPods.  I believe that a recent news story I read said that they're
>> making as much, or more on iPod sales, than they are on computer hardware
>> sales.
>>
>> The iPod profit is a very large margin all the way through the retail
>> chain is suspect.
>>
>> --
>>
>> Glenn M.
>> "John Oellrich" <john@oellrich.us> wrote in message
>> news:43db849c$1@w3.nls.net...
>> Rich,
>>
>> Nope it is the other way around. Well they do probably make a profit on
>> the iPod, but it has no where near the margin of iTunes.
>>
>> --
>> john
>>
>> john@oellrich.us
>>  "Rich" <@> wrote in message news:43db18e3$1@w3.nls.net...
>>     Doesn't apple make money on the ipod hardware and little to none on
>> the itunes store?
>>
>>  Rich
>>
>>    "John Oellrich" <john@oellrich.us> wrote in message
>> news:43da8441@w3.nls.net...
>>    Talk about stupid! Yet another money losing piece of hardware where
>> they will try to make it up in the volume ;->
>>
>>    ...
>>
>>    I would suggest that MS might be better off working with Creative if
>> they want to blunt Apple's dominance in this arena. Get Windows Media 10
>> ported to the device, and then MS could use MSN for the delivery vehicle
>> for the purchased media which is where the real money is.
>>
>>    --
>>    john
>>
>>
>>
>
>

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