Last week, Apple finally agreed to offer a variable pricing policy for music tracks on the iTunes Store, breaking the past 0.99 USD/track strategy to make Music Majors happy. If one will have to search hard to find music tracks with lower than 0.99 USD price tag, as supposed to be according to the PR from Music Majors, everyone noticed the large price increased applied to many artists. The US website Billboard publishes the Top 100 ranking for both songs and artist, and specifically analzed which ones were affected among its Top 100 panel over the first 48 hours following the price increase.
Figures are quite clear and ranking is directly affected by the price change. In average 1.29 USD tracks have lost 5.3 positions, and it will be translated into lower revenue for hte corresponding artist/Music Majors. The foloowing scheme indicated the lsot of revenue following the price increase:
In other words, a decrease of 20% of sales, makes the price increase per song ineffective in raising up revenues. As most of hte hit are often purchase aalone, and not the entire album, high-price tag might not be the right answer, and Music majors will have a hard time in fighting against thsoe figures.
So, the current cinclusion of this experiment is quite simple: customers willing to purchase music are not ready to buy at any cost, and the current strategy followed by music mjors might well be the worst decision taken in the past years in this industry. By increasing the price tag, Music mjoars have successfully decreased the average purchasing budget of customers, and might even pushed others to turn to the P2P network for getting their music tracks. In all cases, sales will decrease for Music Majors, as well as revenues.
This is quite amazing to see those companies not able to "re-Think Different" their business model and not being able to adapt their physical music offers to virtual offer at lower cost. One could purchase the entire album at lower cost than download it from onlien stores. Why they did not think of decreasing the price of their song catalog, increasing sales might have also be translated into increased revenues. It is maybe time to change the way those companies "think"...
Is this thing on?
Filed under: TUAW Business
My first Mac was a second-hand G3 PowerMac that I received as a birthday gift about 5 years ago, which has since been upgraded to a white MacBook that I use for absolutely everything (and my kids use as a coaster). I have a first-generation iPhone because I've convinced myself that EDGE is just fine -- or something.
Apple stuff aside, I'm a husband and dad, a web developer, tattoo collector and coffee enthusiast (meaning I roast it myself in my garage). I'm also something of a recovering productivity nerd, so don't be surprised if you see my name at the top of posts ogling over the latest list management application. Yes, it's a sickness.
I've been doing various blogging bits for a few years now (mostly in the realm of personal organization and "lifehacks", as it were), but nothing quite as high profile as this, that's for sure. I'm very excited to be a part of this stellar team and I look forward to presenting you with many thought-provoking, interesting posts, as well as more than a little poorly-executed humor.
Like most of the cool kids, I'm on the Twitter and would love it if you'd say hello. Thanks for having me!
TUAWIs this thing on? originally appeared on The Unofficial Apple Weblog (TUAW) on Tue, 14 Apr 2009 10:00:00 EST. Please see our terms for use of feeds.
Apple's Tiny iPod Shuffle Cost a Mere 28% of Retail Price
A teardown by researchers shows the device's components cost a mere 28% of its retail price—a fat profit margin. Biggest supplier: Samsung
New iPod Shuffle: 72% Margin for Apple!?
As usual, iSupply has dissected the component used in the new iPod Shuffle in order to evaluate its true manufacturing cost as well as Apple's margin. According to their evaluation, Apple could save 72% out of the current retail price. In details, the 4 GB memory chip will cost 6 USD, while the entire electronic part will be less than 6 USD. Once assembled, equipped with the earphones and properly packed, it should not cost more than 22 USD... So it is a rather substantial margin for Apple, even if you add the not evaluated shipping, localization, design and R&D costs. For sure such figures will give ammunition to the usual suspects prone to attack Apple for any piece of information. We indeed would have preferred to have a cheaper new iPod Shuffle if Apple's margin is so ... substantial...
Verdict on Consumer Reports iPhone app: Helpful but incomplete
Filed under: iPhone, App Store, iPod touch, App Review
I enjoy Consumer Reports magazine, even though sometimes the camera and electronics reviews drive me crazy. The ratings seem sometimes arbitrary, and don't always take what I think are the 'right' features into account and don't weigh those features the same way I would. Nevertheless, I find their reviews useful and another data point to throw in when I'm about to make a purchase.Some months, ago, Consumer Reports launched an iPhone/ iPod touch app, and updated it again recently. The app, appropriately called Consumer Reports, [App Store link] is free, and has a lot of interesting info, but you don't really get links to the wealth of data back at the magazine. Even if you are a subscriber, you can't log in from the app and see magazine content.
You do get a lot of worthwhile news about consumer products, leaning heavily toward Electronics, Cars and products or services for the Home. You also get videos that are sometimes interesting, sometimes bizarre. I didn't make it all the way through the toilet paper tests.
There is some up to date reporting on topics of interest to consumers, like retailer bankruptcies, and what I would call 'tip' articles, like how to shoot a panoramic photo or tips on buying a Netbook.
There is a bit of Mac coverage, most recently a test to see if the MacBook Pro really lasted for 8 hours running on batteries. It didn't in the CR test.
Strangely, the app doesn't have any kind of search function, so if you are looking for just news about Mac laptops, for example, you're out of luck.
I still find the app full of beneficial news, and I give it a browse a couple of times a week. I wonder how Consumer Reports would rate this app? 'Recommended', 'predicted reliability good', but 'could be much better with a few changes'. On the app store users gave it an average rating of 2 stars out of 5. A bit harsh, perhaps. It's generally downgraded because there is no access to the magazine content.
Also interesting is that CR has not been a great fan of the iPhone, complaining, for example, about call quality when it first came out, but they did feel compelled to do this iPhone app. Funny old world.
Here are some screen captures:
TUAWVerdict on Consumer Reports iPhone app: Helpful but incomplete originally appeared on The Unofficial Apple Weblog (TUAW) on Mon, 13 Apr 2009 18:30:00 EST. Please see our terms for use of feeds.
iPhone vs. Windows Phone: It's in the Way That You Use It
When an iPhone fan picks up a Windows phone, his or her first impression may go something like this: "It's difficult to find various features, it's kind of ugly, the hardware doesn't quite match the software, and it's generally user-unfriendly." Vice-versa, when a die-hard Windows Mobile user picks up an iPhone, he or she might think, "This is a locked-up, inflexible platform designed mainly to get you to buy more stuff from Apple, like movies, music and apps."
Increased Price per Tracks on Online Music Stores: The Worst Strategy?
Last week, Apple finally agreed to offer a variable pricing policy for music tracks on the iTunes Store, breaking the past 0.99 USD/track strategy to make Music Majors happy. If one will have to search hard to find music tracks with lower than 0.99 USD price tag, as supposed to be according to the PR from Music Majors, everyone noticed the large price increased applied to many artists. The US website Billboard publishes the Top 100 ranking for both songs and artist, and specifically analzed which ones were affected among its Top 100 panel over the first 48 hours following the price increase.
Figures are quite clear and ranking is directly affected by the price change. In average 1.29 USD tracks have lost 5.3 positions, and it will be translated into lower revenue for hte corresponding artist/Music Majors. The foloowing scheme indicated the lsot of revenue following the price increase:
In other words, a decrease of 20% of sales, makes the price increase per song ineffective in raising up revenues. As most of hte hit are often purchase aalone, and not the entire album, high-price tag might not be the right answer, and Music majors will have a hard time in fighting against thsoe figures.
So, the current cinclusion of this experiment is quite simple: customers willing to purchase music are not ready to buy at any cost, and the current strategy followed by music mjors might well be the worst decision taken in the past years in this industry. By increasing the price tag, Music mjoars have successfully decreased the average purchasing budget of customers, and might even pushed others to turn to the P2P network for getting their music tracks. In all cases, sales will decrease for Music Majors, as well as revenues.
This is quite amazing to see those companies not able to "re-Think Different" their business model and not being able to adapt their physical music offers to virtual offer at lower cost. One could purchase the entire album at lower cost than download it from onlien stores. Why they did not think of decreasing the price of their song catalog, increasing sales might have also be translated into increased revenues. It is maybe time to change the way those companies "think"...
Is this thing on?
Filed under: TUAW Business
My first Mac was a second-hand G3 PowerMac that I received as a birthday gift about 5 years ago, which has since been upgraded to a white MacBook that I use for absolutely everything (and my kids use as a coaster). I have a first-generation iPhone because I've convinced myself that EDGE is just fine -- or something.
Apple stuff aside, I'm a husband and dad, a web developer, tattoo collector and coffee enthusiast (meaning I roast it myself in my garage). I'm also something of a recovering productivity nerd, so don't be surprised if you see my name at the top of posts ogling over the latest list management application. Yes, it's a sickness.
I've been doing various blogging bits for a few years now (mostly in the realm of personal organization and "lifehacks", as it were), but nothing quite as high profile as this, that's for sure. I'm very excited to be a part of this stellar team and I look forward to presenting you with many thought-provoking, interesting posts, as well as more than a little poorly-executed humor.
Like most of the cool kids, I'm on the Twitter and would love it if you'd say hello. Thanks for having me!
TUAWIs this thing on? originally appeared on The Unofficial Apple Weblog (TUAW) on Tue, 14 Apr 2009 10:00:00 EST. Please see our terms for use of feeds.
Apple's Tiny iPod Shuffle Cost a Mere 28% of Retail Price
A teardown by researchers shows the device's components cost a mere 28% of its retail price—a fat profit margin. Biggest supplier: Samsung
New iPod Shuffle: 72% Margin for Apple!?
As usual, iSupply has dissected the component used in the new iPod Shuffle in order to evaluate its true manufacturing cost as well as Apple's margin. According to their evaluation, Apple could save 72% out of the current retail price. In details, the 4 GB memory chip will cost 6 USD, while the entire electronic part will be less than 6 USD. Once assembled, equipped with the earphones and properly packed, it should not cost more than 22 USD... So it is a rather substantial margin for Apple, even if you add the not evaluated shipping, localization, design and R&D costs. For sure such figures will give ammunition to the usual suspects prone to attack Apple for any piece of information. We indeed would have preferred to have a cheaper new iPod Shuffle if Apple's margin is so ... substantial...
Verdict on Consumer Reports iPhone app: Helpful but incomplete
Filed under: iPhone, App Store, iPod touch, App Review
I enjoy Consumer Reports magazine, even though sometimes the camera and electronics reviews drive me crazy. The ratings seem sometimes arbitrary, and don't always take what I think are the 'right' features into account and don't weigh those features the same way I would. Nevertheless, I find their reviews useful and another data point to throw in when I'm about to make a purchase.Some months, ago, Consumer Reports launched an iPhone/ iPod touch app, and updated it again recently. The app, appropriately called Consumer Reports, [App Store link] is free, and has a lot of interesting info, but you don't really get links to the wealth of data back at the magazine. Even if you are a subscriber, you can't log in from the app and see magazine content.
You do get a lot of worthwhile news about consumer products, leaning heavily toward Electronics, Cars and products or services for the Home. You also get videos that are sometimes interesting, sometimes bizarre. I didn't make it all the way through the toilet paper tests.
There is some up to date reporting on topics of interest to consumers, like retailer bankruptcies, and what I would call 'tip' articles, like how to shoot a panoramic photo or tips on buying a Netbook.
There is a bit of Mac coverage, most recently a test to see if the MacBook Pro really lasted for 8 hours running on batteries. It didn't in the CR test.
Strangely, the app doesn't have any kind of search function, so if you are looking for just news about Mac laptops, for example, you're out of luck.
I still find the app full of beneficial news, and I give it a browse a couple of times a week. I wonder how Consumer Reports would rate this app? 'Recommended', 'predicted reliability good', but 'could be much better with a few changes'. On the app store users gave it an average rating of 2 stars out of 5. A bit harsh, perhaps. It's generally downgraded because there is no access to the magazine content.
Also interesting is that CR has not been a great fan of the iPhone, complaining, for example, about call quality when it first came out, but they did feel compelled to do this iPhone app. Funny old world.
Here are some screen captures:
TUAWVerdict on Consumer Reports iPhone app: Helpful but incomplete originally appeared on The Unofficial Apple Weblog (TUAW) on Mon, 13 Apr 2009 18:30:00 EST. Please see our terms for use of feeds.
iPhone vs. Windows Phone: It's in the Way That You Use It
When an iPhone fan picks up a Windows phone, his or her first impression may go something like this: "It's difficult to find various features, it's kind of ugly, the hardware doesn't quite match the software, and it's generally user-unfriendly." Vice-versa, when a die-hard Windows Mobile user picks up an iPhone, he or she might think, "This is a locked-up, inflexible platform designed mainly to get you to buy more stuff from Apple, like movies, music and apps."
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