As major labels quietly lobby Apple to bring variable pricing to its iTunes store, some indies are taking matters into their own hands.
As major labels quietly lobby Apple to bring variable pricing to its iTunes store, some indies are taking matters into their own hands. Last week, New York-based hip-hop label Definitive Jux launched its own download store. The site follows in the footsteps of other such indies as Warp Records and Arts & Crafts, allowing the labels to sell directly to fans and set their own prices.
Def Jux co-owner Amaechi Uzoigwe says the label was motivated to open its own download store as it watched its payments from iTunes grow each month. While not revealing a specific number, Uzoigwe says Def Jux earns "in the six figures, annually," from iTunes. "If we're clearing that kind of money on iTunes, we're onto something here," he says.
The Def Jux MP3 downloads will not contain any digital rights management encoding. The site will also highlight exclusive content, and Uzoigwe envisions a time when the label's artists -- which include El-P, Company Flow, Mr. Lif, RJD2 and Aesop Rock -- will upload new tracks and freestyles to the site on a monthly basis.
Of course, all of these label-centric stores could leave traditional retailers a bit uneasy. Uzoigwe admits that, with exclusive content going straight to the Def Jux Web store, the label's physical distribution partners "hate it." But Uzoigwe believes the site will position Def Jux to be at the forefront of a new business model. New artists, for instance, will get digital-only trial runs before a single CD is pressed, saving a slow-selling artist up to $100,000 in unrecoupable debt.
"Retailers been making a lot of money off of record labels, and it's a bad business model," Uzoigwe says. "We're not antagonizing them. Our great relationships with a lot of retailers aren't going to stop. But for anyone to think if we ignore the Internet it will help retailers, that's nuts. It's delusional. The Internet is happening."