There appears to be a stalmate in which Apple may threaten to shutdown iTunes due to an increase in royalty fees. What is also unsure is exactly who may end up paying for the increase. Someone will need to absorb the cost either by the music industry itself, Apple or you the consumer. So will Apple close down iTunes? That is highly unlikely. According to the article it states that:
The National Music Publishers’ Association wants rates increased from 66 percent, from 9 cents to 15 cents per track. Digital music stores, represented by the Digital Media Association, wants the rate lowered to 4.8 cents per track. Apple pays an estimated 70 percent of digital music revenue to record companies, who pass on a percentage to artists. That percentage is what’s being adjusted Thursday.
If the royalty rate is increased, someone — either Apple, the record companies or the consumer — will have to pay for it. Apple believes that an increase in price because of a rise in royalty fees “would lower total music purchases at the store.” So, Apple doesn’t want to increase the price and the record companies are highly unlikely to pick up the cost on their end. “If the [iTunes store] was forced to absorb any increase in the … royalty rate, the result would be to significantly increase the likelihood of the store operating at a financial loss — which is no alternative at all,” said Cue. “Apple has repeatedly made it clear that it is in this business to make money, and most likely would not continue to operate [the store] if it were no longer possible to do so profitably.“
This is just another example of greed in America. Does anyone really doubt that we the consumer will end up paying for the increase? Part of the problem, which has been exhibited during the past few weeks, is that greed by individuals and our political leaders is now having a devastating affect on the average American.
I don’t know about you but I am disgusted with the way greed has over taken our entire society. What do you think? Are you a happy camper?