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Sony raised prices on Whitney Houston’s digital music 30 minutes after her death
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#31
14th February 2012
Old 14th February 2012
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Quote:
Originally Posted by aroundtheworld View Post
Sorry, chrisso, but I don't understand the point you're making here. As you yourself note, there is no finite element of supply when it comes to digital products. What is the relevance of physical shelves being stripped bare?
It's a METAPHOR.

Do you understand metaphor?
#32
14th February 2012
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Quote:
Originally Posted by chrisso View Post
Just the illustration of an expected feeding frenzy.
I guess in the expected feeding frenzy, Sony might look at the Steam example and think they could make even more money by discounting Houston's digital catalogue. However, they are probably just as happy to respond to the spike in sales by increasing their price and seeing quite a few dollars roll in.
Apart from 'Steam', that is the accepted business model for many, many products.
High demand: keep pricing up, even if supply isn't an issue (see Apple's iPhone for clear evidence of that).
Slump in demand: reduce pricing to stimulate more sales.
Steam's products don't become more popular when they die. In fact, when they die pretty much nobody is interested in them anymore.
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#33
14th February 2012
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Quote:
Originally Posted by tvsky View Post
good point but I think he is talking about the steams success in discounting vs sonys price gouging tactics

its a good indication of the general mindset of a new growing business model vs on old irrelevant and dying one
No, it's not.

When a music star dies, public interest INCREASES.

When a computer game dies, public interest dies too.

Two totally different marketing situations.

When Whitney gets strung out and starts blowing concerts then public interest drops and prices of her work drops - but when she actually croaks public interest PEAKS so prices go through the roof. Simple economics.

Apologies for the indelicacy.
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14th February 2012
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Jeez loueez guys...

Yes it was slightly off-topic. It didn't relate 100% to the death and exploitation of a musical artist.

But this thread (I didn't read the actual article linked) also highlighted the fact that Sony raised their prices of digital delivery hoping to profit from the given situation and as such I find aroundtheworld's post very informative.

I know nothing about Steam or the gaming industry but as a businessman as well as an artist I find their observations about discounting very interesting.

You KNOW that discounting affects sales. And I'm pretty sure it affects digital sales just as much as physical sales nowadays too. Or it will soon enough. How many bands in the Top 10 have we've seen with discounted albums in Tesco, Walmart or HMV? The idea of "It's selling. Let's drop the price and push it to all those sitting on the fence" is very old.

You talk about the increased sales flowing back to Whitneys estate and daughter?

Imagine if the Steam-findings where applicable to music sales? (And there's no point in arguing that it's NOT applicable because until it's been examined we just don't know...)

To make things easy (very easy) let's say Whitney makes $0.50 per digital album sale.

1000 Sales = $500

Now say they discount the album by 75% (dropping here royalty to $0.125 per album) but increase their sales 40 FOLD.

40,000 Sales = $5,000 (God it's too early for my maths...)

If they're going to gouge (for whatever reason) at least let them (us?) find the most effective way to profit from it.

I find that very interesting and have only discovered this information by reading this thread.

We don't ALWAYS need to the forum police to protect us from the evils of off-topic, you know?

Back on-topic: The whole Whitney story is still so sad in so many ways...
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#35
14th February 2012
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Classy.
#36
14th February 2012
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Quote:
Originally Posted by tvsky View Post
planned obsolescence is totally factored into music

wax cylinder -> vinyl -> 8 track -> compact cassette -> CD -> Mp3 -> next thing . minus a few odds and ends and freak formats along the way.
Firstly, most of the time it isn't planned.
I entered the music business in the vinyl era and no one, but no one was thinking about CD.
Neither 8 track or cassette replaced vinyl. They were more like portable additions, especially for car audio.
Finally, no one forced you to buy anything new.
Many people still enjoy their vinyl collections. Vinyl records are still available to buy.
MP3 hasn't replaced CD. CD's still sell quite well. Your whole timeline of obsolescence is wrong.
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#37
14th February 2012
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I still gotta say....



BOOOOOO!!!! SONY!

Shameful exploitation......
#38
14th February 2012
Old 14th February 2012
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Quote:
Originally Posted by John Eppstein View Post
When a music star dies, public interest INCREASES.

When a computer game dies, public interest dies too.
Quote:
Originally Posted by John Eppstein View Post
Steam's products don't become more popular when they die. In fact, when they die pretty much nobody is interested in them anymore.
Computer games don't die. In fact, the longevity of computer games is one of the most significant differences between the console and PC markets: console games show big sales early on and quickly drop to insignificance; PC games sell less immediately, but have a drastically larger and deeper long tail. User mods, user maps, user content, and stronger communities are a few of the key differences in this phenomenon.

Planned obsolescence? That's for consoles; not PCs.

Quote:
Originally Posted by John Eppstein View Post
When Whitney gets strung out and starts blowing concerts then public interest drops and prices of her work drops - but when she actually croaks public interest PEAKS so prices go through the roof. Simple economics.
I'm sorry that you missed one of the points I was hoping to impress upon the reader, John, but I will reiterate it:

Quote:
Originally Posted by aroundtheworld View Post
[Steam tends] to use current events and hype related to titles they offer as cause to reduce price, rather than increase it. And it's not surprising, given what they report happens to their earnings!
In the physical world, it makes a lot of sense to increase prices when you anticipate a surge in demand (following a death, as an example). But in the digital world, when one does not worry about bare shelves and inadequate supply, Steam makes a compelling case that the conventional real-world-retail practice may not always be the most profitable.

Now, if you are still obstinate in your objection to the relating of Steam to the discussion of modern digital distribution practices, I am afraid that the failing may be yours.
#39
15th February 2012
Old 15th February 2012
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Quote:
Originally Posted by The MPCist View Post
I still gotta say....



BOOOOOO!!!! SONY!

Shameful exploitation......
Yeah, the big companies are making the independents look bad. Doesn't play well in the big picture of things. More propaganda for the Googlemonster to use.
#40
15th February 2012
Old 15th February 2012
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Quote:
Originally Posted by Ol' Betsey View Post
Jeez loueez guys...

Yes it was slightly off-topic. It didn't relate 100% to the death and exploitation of a musical artist.

But this thread (I didn't read the actual article linked) also highlighted the fact that Sony raised their prices of digital delivery hoping to profit from the given situation and as such I find aroundtheworld's post very informative.

I know nothing about Steam or the gaming industry but as a businessman as well as an artist I find their observations about discounting very interesting.

You KNOW that discounting affects sales. And I'm pretty sure it affects digital sales just as much as physical sales nowadays too. Or it will soon enough. How many bands in the Top 10 have we've seen with discounted albums in Tesco, Walmart or HMV? The idea of "It's selling. Let's drop the price and push it to all those sitting on the fence" is very old.

You talk about the increased sales flowing back to Whitneys estate and daughter?

Imagine if the Steam-findings where applicable to music sales? (And there's no point in arguing that it's NOT applicable because until it's been examined we just don't know...)

To make things easy (very easy) let's say Whitney makes $0.50 per digital album sale.

1000 Sales = $500

Now say they discount the album by 75% (dropping here royalty to $0.125 per album) but increase their sales 40 FOLD.

40,000 Sales = $5,000 (God it's too early for my maths...)

If they're going to gouge (for whatever reason) at least let them (us?) find the most effective way to profit from it.

I find that very interesting and have only discovered this information by reading this thread.

We don't ALWAYS need to the forum police to protect us from the evils of off-topic, you know?

Back on-topic: The whole Whitney story is still so sad in so many ways...
But it doesn't work that way.

Dropping the price of Whitney's albums would not increase sales one iota.

Right now sales are up because of the fan base feeding frenzy surrounding her death. Those people will buy at any halfway reasonable price - halfway reasonable in this case being as much as 2X the previous price when she was alive and significantly more for "special memorial editions, blah-blah-blah". Dropping the price now would have only one effect - cutting profits. And let's face it, no responsibly run business is going to deliberately cut profits in a windfall situation. Businesses are not sentiment driven.

Labels only drop the price of an artist's records when that artist is no longer selling in appreciable quantities (or in some cases when that particular title is no longer selling well, usually due to competition from a newer release), hoping to eke out a few more sales from "bargain hunters" who are not really part of the core customer base.

IT'S BUSINESS, PEOPLE! That's all it is. just business.
#41
15th February 2012
Old 15th February 2012
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Quote:
Originally Posted by aroundtheworld View Post
Computer games don't die. In fact, the longevity of computer games is one of the most significant differences between the console and PC markets: console games show big sales early on and quickly drop to insignificance; PC games sell less immediately, but have a drastically larger and deeper long tail. User mods, user maps, user content, and stronger communities are a few of the key differences in this phenomenon.

Planned obsolescence? That's for consoles; not PCs.



I'm sorry that you missed one of the points I was hoping to impress upon the reader, John, but I will reiterate it:



In the physical world, it makes a lot of sense to increase prices when you anticipate a surge in demand (following a death, as an example). But in the digital world, when one does not worry about bare shelves and inadequate supply, Steam makes a compelling case that the conventional real-world-retail practice may not always be the most profitable.

Now, if you are still obstinate in your objection to the relating of Steam to the discussion of modern digital distribution practices, I am afraid that the failing may be yours.
I'm not going to bother debunking the myth of the "long tail" in the current climate.

However, the other part of the post is worth a comment.

You (as a company) raise prices after a death BECAUSE OF A SURGE IN DEMAND, not because of any scarcity of product. If it was a physical product there's no problem firing up the record presses and dumping a few more million copies in the stores within a couple of days.

The fact that distribution is digital doesn't enter into it. People are willing to pay more for an artist's work immediately following their death, so prices go up. It's called "charging what the market will bear". Death makes the product more valuable to the customers, so prices rise. The medium of distribution is of no significance. Mourning fans want to hear the dead star, so they run out like good little lemmings and buy the records at whatever the going price is. Or hit the "buy" button in iTunes. Whatever. It's the same thing.

Many people labor under the mistaken impression that such things as business, morality, and law are different over the internet simply because things are virtual, not physical. T'ain't so.

For more on that read Jaron Lanier's brilliant and entertaining critique of internet culture "You Are Not A Gadget". For those who don't know, Lanier is known as the "father of virtual reality" and was one of the guiding lights of the early internet/WWW.
#42
15th February 2012
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Quote:
Originally Posted by John Eppstein View Post
I'm not going to bother debunking the myth of the "long tail" in the current climate.
There isn't anything to debunk as it relates to PC vs. console game sales. Console games sell more initially and drop off quickly (in part because of the second-hand market); PC games don't have as high initial sales figures, but have a much, much longer profitable lifespan. There are even popular and prosperous distributors that cater exclusively to older PC titles.

Quote:
Originally Posted by John Eppstein View Post
The fact that distribution is digital doesn't enter into it. People are willing to pay more for an artist's work immediately following their death, so prices go up.
Maybe you're right, John. Maybe it is that simple. Maybe that is, and will always be, the best and most profitable way to react to demand spikes, even digitally. But there's no getting around the compelling figures that suggest otherwise, and as Ol' Betsey points out above:

Quote:
Originally Posted by Ol' Betsey View Post
Imagine if the Steam-findings where applicable to music sales? (And there's no point in arguing that it's NOT applicable because until it's been examined we just don't know...)
We simply don't know whether such a strategy can work for music. And despite all your boisterous surety, that includes you. Believe it or not, conventional wisdom has been wrong before.
#43
15th February 2012
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#44
15th February 2012
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When I die, the first thing I'm going to do is raise my prices..
In for the win!
#45
15th February 2012
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Quote:
Originally Posted by chrisso View Post
By the way, games are in a slump right now:
BBC News - Video game sales fall ahead of PlayStation Vita launch
Not that it's really on topic in any way at all, but gaming is actually currently at (or very near) it's peak of the past few years. Those reports don't take into account digital releases, which make up a massive portion of the market these days, and it doesn't take into account the differing states of game releases from last year to this.

The last place I'd go for news about the gaming industry is the mainstream media.

Physical sales for the past month may be down slightly from last year, but that's hardly what I would call a slump after what happened in the last few months of last year.
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#46
15th February 2012
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Quote:
Originally Posted by Kaoz View Post

Physical sales for the past month may be down slightly from last year
34%
#47
15th February 2012
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Quote:
Originally Posted by aroundtheworld View Post
Maybe you're right, John. Maybe it is that simple. Maybe that is, and will always be, the best and most profitable way to react to demand spikes, even digitally. But there's no getting around the compelling figures that suggest otherwise, and as Ol' Betsey points out above:
Figures relating to video games in the holiday season have nothing to do with what we're talking about. NO-thing. You're comparing kumquats to motorcycles.

Quote:
We simply don't know whether such a strategy can work for music. And despite all your boisterous surety, that includes you. Believe it or not, conventional wisdom has been wrong before.
Actually, some of us aren't simply guessing and blowing smoke.
#48
15th February 2012
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Quote:
Originally Posted by chrisso View Post
34%
Again, not really on topic, but if you compare that to the upwards trend is digital sales and user base over the past 12 months, and factor in the completely different circumstances, the drop isn't anywhere near as significant as reported.

I really fail to see what this has to do with the topic at hand though.
#49
15th February 2012
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#50
15th February 2012
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Quote:
Originally Posted by chrisso View Post
By the way, games are in a slump right now:
BBC News - Video game sales fall ahead of PlayStation Vita launch
Yes, this claim warrants a level of scrutiny as was pointed out above.

Monthly sales statistics for an entertainment market? Almost entirely irrelevant, because the quality and quantity of entertainment released in a given month can vary greatly.

"Slump," as chrisso editorializes? I literally laughed out loud. This year had worse January console releases than last year. It's a nearly completely inconsequential and irrelevant metric based solely on the specific titles released in that period. It takes a lot more data to observe any kind of trend in entertainment, and the gaming industry is very much trending upward.

I also rather doubt this tangent can be related to the subject of digital distribution strategies, particularly given that the figures you link do not take into account any PC games or any digital sales. But I won't harangue you over it.
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#51
15th February 2012
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#52
15th February 2012
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Quote:
Originally Posted by ds11 View Post
Sony Apologizes for Whitney Houston Price Hike in U.K.

Read more: Sony Apologizes for Whitney Houston Price Hike in U.K. | Music News | Rolling Stone

Here comes the bullshit

"Whitney Houston product was mistakenly mispriced on the U.K. iTunes store on Sunday," said a statement issued by Sony. "When discovered, the mistake was immediately corrected. We apologize for any offense caused."
If you take them at their word without reading conspiracy into it, it does kind of put a damper on the claims that this was simply a shrewd business maneuver that was both sensible and expected.

Maybe digital economics aren't so simple after all.
#53
16th February 2012
Old 16th February 2012
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Quote:
Originally Posted by aroundtheworld View Post

"Slump," as chrisso editorializes? I literally laughed out loud.
Dude, seriously, you just reach too much.
I didn't 'editorialize' anything. The comment 'slump' was the second thing written in the article. It was the sub-headline:
Quote:
Video game sales slumped in the US - their biggest market - in January.
.
http://www.bbc.co.uk/news/technology-16983122

The editorializing was all the BBC's, you should be laughing at them, not me. Ever heard the phrase, "don't shoot the messenger"?
The BBC may not be perfect, nor the ultimate voice in technology reporting, but I'll take the BBC any day over Techdirt and Torrentfreak, two 'news' sources you regularly link to and presumably accept as valid.
So, I merely linked to a BBC news story and made a comment of my own that was almost word for word taken from the article.
If you take issue with it, that's fine, but you're not 'literally laughing out loud' at me, you'er laughing at the BBC and it's journalists.
PS: Take note of the absence of bold capitals and underlined passages in the above.
#54
16th February 2012
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Quote:
Originally Posted by aroundtheworld View Post
Yes, this claim warrants a level of scrutiny as was pointed out above.

Monthly sales statistics for an entertainment market? Almost entirely irrelevant, because the quality and quantity of entertainment released in a given month can vary greatly.

"Slump," as chrisso editorializes? I literally laughed out loud. This year had worse January console releases than last year. It's a nearly completely inconsequential and irrelevant metric based solely on the specific titles released in that period. It takes a lot more data to observe any kind of trend in entertainment, and the gaming industry is very much trending upward.

I also rather doubt this tangent can be related to the subject of digital distribution strategies, particularly given that the figures you link do not take into account any PC games or any digital sales. But I won't harangue you over it.
And you're still comparing apples to elephants.
#55
16th February 2012
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Originally Posted by aroundtheworld View Post
If you take them at their word without reading conspiracy into it, it does kind of put a damper on the claims that this was simply a shrewd business maneuver that was both sensible and expected.

Maybe digital economics aren't so simple after all.
Nah. It was an intentional business maneuver all right. Only thing is some people started making a little bit of a stink about it and rather than ignoring it, as they should have, some senior executive freaked out and said "Oh NO! We can't have any more BAD PRESS! We'll have to say it was a mistake and cut our losses!"

In case nobody's noticed, the people running Sony Entertainment are largely buffoons who don't know their ass from a hole in the ground.....

Were I, through some stroke of lightning, ever to become hugely popular and die I hope to GOD they have the sense to raise prices on my product and make some money while they can.

There's a funny phenomenon - people value stuff more when they pay a higher price for it.
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16th February 2012
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Quote:
Originally Posted by ds11 View Post
Sony Apologizes for Whitney Houston Price Hike in U.K.

Read more: Sony Apologizes for Whitney Houston Price Hike in U.K. | Music News | Rolling Stone

Here comes the bullshit

"Whitney Houston product was mistakenly mispriced on the U.K. iTunes store on Sunday," said a statement issued by Sony. "When discovered, the mistake was immediately corrected. We apologize for any offense caused."
No need to shout, sonny.

Does anyone know what the pricing is in the US?
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16th February 2012
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I actually think the discount sale idea is an interesting one. Especially with an artist like Houston, what's the chance that somebody buying her stuff on itunes is going to buy more than one of her albums at $15? Most people will probably just pick up the greatest hits. So why not offer a deeply discounted collection of her entire catalog? That way you could get people to pay more while giving them the feeling that they're getting greater value for their money.
#58
16th February 2012
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Quote:
Originally Posted by initialsBB View Post
I actually think the discount sale idea is an interesting one. Especially with an artist like Houston, what's the chance that somebody buying her stuff on itunes is going to buy more than one of her albums at $15? Most people will probably just pick up the greatest hits. So why not offer a deeply discounted collection of her entire catalog? That way you could get people to pay more while giving them the feeling that they're getting greater value for their money.
Nope. It's quite the reverse. In the fan feeding frenzy following an artist's death many people will buy everything they don't already own. At the going price.

Deeply discounted collections are what you offer when an artist is losing popularity. When artists die they typically GAIN popularity.

In Houston's case there's another factor - she didn't write her own songs and songwriter and publishing royalties don't change.
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16th February 2012
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Quote:
Originally Posted by aroundtheworld View Post
... Maybe digital economics aren't so simple after all.
We have enough occurrences of company websites accidentally advertising nonsensical prices for products to prove this. "To err is human. To really foul things up requires a computer." (Old but still true.)
#60
16th February 2012
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Originally Posted by John Eppstein View Post
Nope. It's quite the reverse. In the fan feeding frenzy following an artist's death many people will buy everything they don't already own. At the going price.
yeah, I'm sure the music biz accountants know more about this stuff than I do and I'm sure they have numbers to back it up.

Quote:
Originally Posted by John Eppstein View Post
In Houston's case there's another factor - she didn't write her own songs and songwriter and publishing royalties don't change.
oh yeah, good point. Usually when people say the music industry isn't innovative enough or they move too slowly, there are actually legal and licensing issues that make the layman's "solution" impossible. The same is true for a lot of the apparently "dumb" decisions made by the movie industry.
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