Apple And Apple's Challenges In The Music Industry

Improved Essays
ITunes music (Apple) store entered into the music market in 2003. However, prior to Apple 's entry into the digital world of music, the industry was fighting this new wave of music getting released to customers. However, with Apple 's release of its iPod digital-media player (2001) and adding the iTunes Store in 2003, they became the gatekeeper of digital downloads. Consequently, they promptly became supreme inside this new swim lane of the music industry. The key player that allow this was the iPod, MP3 players, and Apple 's own iTunes software which all interfaced, thus making them one of the industry most popular amongst technology favorites and consumers. However, the music companies did not take too kindly to this, they were at odds …show more content…
The heavyweights of the music industry cried out, saying Apple was fouled and yelled infringement and pricing violations. Now, the reason was that Apple had brought a new way to purchase music and overpriced CDs were rapidly becoming ancient with this new arrival in the market to consumers. Clearly Apple recognizes the need for this technology because the music was being illegally shared through service such as peer-to-peer file sharing networks. Therefore, acknowledging that music was being compressed, new techniques were being developed to take a bit out of this sharing by those with an interest in earning a profit. Yes, Apple was changing the delivery of music, but the dilemma for the industry and what they were facing was to decide if they should allow piracy to continue its effect on variable pricing alternatives. What this paper will attempt to do is take a look at alternative pricing presented in the case study observation, iTunes music pricing. Hopefully by the conclusion, variable pricing will be a bit clearer and this paper will have delivered and understanding of variable pricing policies and the decision why it is …show more content…
What types of songs do you think Apple tends to sell at the lower prices?
A business is in the market to make money and they are always looking for ways to increase their profit margin. Therefore, if you consider that Apple entry this market in 2003 that now six years later they would be thinking of ways to make more money. So, if you lower the prices of music sold online, you get more people to buy that music, but music sold through other means would take a hit. However, to counter that you would offer the music you sell through other services either cheaper or just a low as that you are selling online. The age of digital music brought about such a change, but with all the content that was still available for music, you have to have a way to move that as sell because your before time stores were taking a heavy hit as a result of digital download. In additional they had to do something to sell their much bigger files and other various formats that customers had as well. Example: I have over 6000 thousand mp3 but they are all on CD, so if you offer that in other formats that I can purchase equation or convert at a lower cost – I am going to be open to that because I do not want to have purchased music I already have. So, Apple knows this they offered these price

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