iTunes Sales Slump With Tiered Pricing

[Jeff Campbell]

<div class='os_post_top_link'><a href='http://www.tuaw.com/2010/02/10/act-surprised-higher-itunes-prices-mean-slower-sales/' target='_blank'>http://www.tuaw.com/2010/02/10/act-...n-slower-sales/</a><br /><br /></div><p><em>"Warner Music revealed on Tuesday something we've all long suspected: music sales have witnessed a growth slump on iTunes since the record labels pushed Apple to implement a variable or tiered pricing model."</em></p><p><img src="http://images.thoughtsmedia.com/resizer/thumbs/size/600/zt/auto/1265815145.usr105634.jpg" /></p><p>Price goes up, demand goes down, not sure why they thought it would be any different with music than other goods in the mostly free market economy they operate under. Warner saw a 50% decline in revenue for their quarter ending in December 2009 so perhaps they will rethink their pricing. I have my doubts based on how they have done things in the past. I'm interested to see how this will work in the e-book field over the next year though.&nbsp;</p>

[davidnicholls]

Warner didn't see a 50% revenue slump. They say a 50% growth slump. Revenues were still up on last year (by 5%) but last year they were up 10%

[doogald]

To be fair, it isn't that sales have slowed, it's that the GROWTH of sales has slowed, at Warner Records in particular. At some point that was bound to happen anyway. Sales are still growing - they were up 5% the past quarter over the prior year, vs. up 10% and up 11% the previous two quarters.

And it could also have been (though I honestly don't know) that Warner's new music catalog this quarter sucked compared to last year.