Apple To Shut Down iTunes?

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Apple To Shut Down iTunes?

Postby Genuine_Indian_Guru » Thu Oct 02, 2008 8:01 pm ... tunes.html

Apple could shut down its iTunes music store this week, if a verdict from the US Copyright Royalty Board forces the company to pay higher royalty rates.

A ruling is expected by the board today (October 2) on an application by the National Music Publishers' Association to raise the royalty fees paid to its members on songs purchased from online music stores including iTunes.

The association wants to increase rates by 66 per cent, from nine cents to 15 cents per track, whereas Apple wants a decrease to 4.8 cents per track, reports CNN.

In a statement submitted to the board last year, iTunes vice president Eddy Cue said that Apple would not stand for an increase:

"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," the statement read.

Cue added that Apple would have no qualms about shutting iTunes down if it was not making enough money.

"Apple has repeatedly made it clear that it is in this business to make money," he said, "and most likely would not continue to operate [the iTunes store] if it were no longer possible to do so profitably."

Research analysts Piper Jaffray predict that Apple will have an 85 per cent share of the digital music market this year.

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Re: Apple To Shut Down iTunes?

Postby tristanjblythe » Fri Oct 03, 2008 4:52 am

I think this a bit of an empty threat.

The publishers want more royalties but Apple are saying if you try that then you'll get none. Given the rise in online purchasing of music (and Apple's massive share of that market) I think they are gambling that the companies will not want to lose it all and so will accept what they currently get - note they say the shut down threat seems only to refer to if an increase not if same.
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Re: Apple To Shut Down iTunes?

Postby wildlife74 » Fri Oct 03, 2008 8:03 am

It won't happen.

Publishers have been trying this tactic for years to get money for artists from electronic means of music broadcast and circulation.
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