iTunes: Variable Pricing Was Cost of Over the Air Downloads?
What finally made Apple and Steve Jobs relent on their previously locked-in-stone $0.99 single price for single songs iTunes business model? Many suspected it was the lure of DRM-free music, which the record labels (except EMI) had been withholding from Apple and providing competitors like Amazon MP3 in an attempt to break the iTunes juggernaut.
the key negotiating component was over-the-air downloads for the iPhone. The record companies held out on allowing users to download songs on the 3G and EDGE networks (instead of just WiFi) until Apple relented.
While this might seem strange, technically many users probably don't care (or don't even know about DRM) unless they run into the old 5-machine limit or try to move their protected music outside the iPod ecosystem. However, anyone hitting the iTunes icon on the iPhone and getting the message to switch to WiFi likely suffers a bad user experience. Then again, strange is normal in a strange industry filled with strange old media dinosaurs, innit?
Higher prices, according to the article, are also intended to make discounted song bundles seem like better values.
How important is 3G or EDGE downloads to you? Worth the potential cost bump for premium "hot" singles? Mitigated at all by the thought of cheapo bundles of the same? Let us know!