Business Matters: EMI/iTunes '69-Cent Songs' Promotion A Hit At iTunes
Business Matters: EMI/iTunes '69-Cent Songs' Promotion A Hit At iTunes

Lots Of Love For EMI/iTunes '69-Cent Songs' Promotion

-- Usually it's rare to see a lot of songs priced under $1.29 on iTunes' list of its current top 200 tracks. Earlier this week, however, 32 songs priced at $0.69 were on the store's top songs list.

What were all those inexpensive songs doing mingling with more expensive -- and more current -- hits? On March 14, iTunes launched a series of various artist compilations containing EMI music priced at $0.69 per track. The "69-Cent Songs" promotion got prime placement as well as a dedicated page that collects the 12 collections with titles such as "69-cent Pop Songs" and "69-cent One-Hit Wonders."

How are their sales? Because the promotion started just a few days ago, there won't be SoundScan sales data for another week and a half. But there's little doubt the promotion is giving a nice sales boost to these mostly catalog songs. Five of the songs, including Katy Perry's "Teenage Dream" (#56) and John Lennon's "Imagine" (#77), were ranked in the top 100. That left 27 others to fall between #100 and #200. Some tracks were current hits, such as Keith Urban's "Put You in a Song" (#153), but most were older classics like Vanilla Ice's "Ice Ice Baby" (#134) and UB40's cover of Neil Diamond's "Red Red Wine" (#165).

What's not clear is how these songs would sell if they were always priced at $0.69. When consumers feel they have a limited time to acquire something at a discount, they tend to stock up. And the fact that the cheaper tracks gained valuable impressions through prominent placement cannot be overlooked. Perhaps tracks would sell better if they were permanently priced at $0.69, but they might not jump up the rankings like these have.

In the end, $1.29 tracks continue to rule. Five tracks -- not part of this promotion -- in the top 200 were priced at $0.99. That left 163 out of 200 tracks (82%) priced at $1.29. The top 52 songs were all priced at $1.29. The top $0.99 track ranked #75. And since there is a very sharp drop off after the top 5, it's clear that many consumers prefer in-demand, current hit over a lower-priced classic.

Territorial Distribution Blues

-- Is Five Weeks a Long Time to Wait for a U.S. Release? On February 8, Fred Wilson from Union Square Ventures posted a blog entry about his frustration that an album by a U.K. artist was unavailable for purchase in the U.S. Five weeks later, that album hit U.S. retail.

Wilson sought the Streets' "Computers and Blues" from U.S. download stores after hearing it at SoundCloud (a legal upload, by the way, but streaming only). But no U.S. download stores had the album. Amazon was selling only an expensive import CD. He tried buying it at Amazon's U.K. site but he would have needed to pay extra to acquire a U.K. I.P address.

So instead of either waiting or spending the time on a workaround, Wilson downloaded the album in "less than a minute" from a torrent site. "This is f---ed up," he wrote. "I want to pay for music. I value the content. But selling it to some people in some countries and not selling it to others is messed up. And selling it in CD only format is messed up. And posting the entire record on the web for streaming without making the content available for purchase is messed up."

Is a five-week gap between a U.K. street date and a U.S. street date either a long time or a bad thing? If you've worked in music for a while you might just think that's how it goes. You understand that music comes with territorial rights. And you might just accept it for what it is. Compared to some long waits for a foreign artist's album to arrive in the U.S., five weeks isn't much.

But when buying music is an increasingly optional practice, five weeks is a long time to ask fans to wait. Consumers don't care about the "inside baseball" aspect of territorial distribution rights. They just want to buy music when the desire strikes them.

It's not difficult to imagine a scenario in which likely sales were lost to illegal downloads. In that five-week period, the Streets' more serious fans probably knew the album was available. With email, social media and ubiquitous news, it's easy to keep track of one's favorite artists. And the more they wanted it, the more likely they may have been to get it illegally. That's a shame because the serious fans are the most likely to part with their money. Five weeks later, the people most likely to buy the record had become the less serious fans who hadn't already acquired it illegally. As for the most serious fans, some of the more well-meaning ones may have both acquired it illegally and bought it this week. Maybe. But should record labels rely on the idealism of music fans when setting release dates? (A VC)