Apple Computer boss Steve Jobs vowed yesterday to repel "greedy" record companies' demands for higher music-download prices, warning that...
PARIS — Apple Computer boss Steve Jobs vowed yesterday to repel “greedy” record companies’ demands for higher music-download prices, warning that any such move would encourage piracy.
Jobs, speaking before the opening of the Apple Expo in Paris, said some music majors were pushing for an increase in prices on Apple’s online iTunes Music Store.
Apple’s co-founder and CEO said record companies already earn more profit from songs sold through iTunes — cutting out costs of manufacturing, marketing and returns — than from those sold on CD.
“So if they want to raise the prices it just means they’re getting a little greedy,” he said.
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As their contracts with Apple come up for renewal, music companies are seeking to improve their take from sales through the U.S. iTunes site, which charges 99 cents per song. Prices are typically higher in Europe, Japan and other regions.
Apple Computer launched its Japanese iTunes site in August without Sony BMG’s music catalog, as negotiations dragged on.
Observers say the same issues are likely to surface in talks between the two companies on their U.S. sales, and Warner Music is also reportedly seeking price increases.
Warner Music and Universal Music declined to comment. Sony BMG and EMI did not return calls.
Jobs indicated he plans to stand firm. “Customers think the price is really good where it is,” he said.
“We’re trying to compete with piracy, we’re trying to pull people away from piracy and say, ‘You can buy these songs legally for a fair price,’ ” he added. “But if the price goes up a lot, they’ll go back to piracy. Then everybody loses.”
Ted Schadler of Forrester Research agreed with Jobs that any move to raise prices could backfire.
Among Internet users ages 12 to 21, Schadler said, about 50 percent share tracks illegally. Six percent buy online and don’t share.
“This is a minority phenomenon,” he added. “Why would you do anything to put a kink in that?”