Paid digital downloads gain momentum.

iTunes has started the revolution. There's growing confidence amongst record companies and artists that the pay-per-track download scheme popularised by iTunes earlier this year, and now being used by similar sites and applications like BuyMusic, Musicmatch and Napster 2.0 (and which has been the model at the site I help admin - amplifier.co.nz - for over a couple of years) might actually be the way forward for retail music.

Although kazaa, soulseek and their ilk still offer up much the same catalogue (in fact, probably more tunes than all the legitimate stores put together, and then some), the legality of the online stores, the fact that they're relatively easy-to-use, and the good karma that comes from knowing that some of the US$0.99 you pay for any given track might actually work its way back to the artist, should see the pay services start to snaffle away at least the more respectable and mature users of the free p2p networks. Particularly as the growth of p2p virii on kazaa becomes more rampant, and parents with music downloading kids make a vague attempt at keeping their offspring away from the truckloads of porn that infest that and most other similar free p2p apps (try doing a general search for Britney on Kazaa - not the sort of thing you want your 14yo daughter to be downloading, really).

And hopefully the US$0.99 'standard' price-per-track that seems to have sprung up will become a bit more flexible over time. Really, if you want to download a 12-track album, it's gonna cost you US$11.88 (about NZ$20). For NZ$24 I can probably get the same album from smokecds.com, with jewel-case, artwork and in the full hi-fi format, not some 'good-but-not-perfect' mp3. And if it's really popular, it's probably even cheaper down at the Warehouse.

Paul Boutin over at Slate has investigated the various issues around the pricing of tracks. It's interesting what conclusions he comes to: his original thought was that charging more for popular tracks and less for 'the crap' (William Shatner and Milli Vanilli are dragged out as wholly suitable examples of the latter genre) would be the way to go. Turns out the opposite is more likely true: using hit tracks as a loss leader to get people into the store, and then charging 'normal' prices for everything else - just like the traditional bricks'n'mortar store. Although, he does point out that Rhapsody's sales tripled when the store slashed its burn-to-disc price to 49 cents (for all tracks) as a test run, so, perhaps, online stores won't quite follow the same business models as their real-world counterparts.

No doubt these issues will be resolved over the next couple of years, as the big record companies crunch the numbers that (they hope) will see them selling their tracks for the optimum return. The problem seems to be, at present, that the major labels are still charging US$0.70 to US$0.80 cents per song wholesale to the online stores. That's just insane, really, and the catalyst for change may actually come from the infamously exploited artists, who are starting to see how cutting out some of the middle-men might benefit everyone (except the middle-men, obviously). Moby's got it sussed, in this article from the Economist he asks "Why is a record company any more qualified to send an MP3 to iTunes than I am?"

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