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Microsoft paying Zune per-unit bounty to Universal
On every Zune sold, Microsoft will pay a fee to the Universal music group. On the surface it's just another licensing deal, but it's easy to see this as an oblique shot against iTunes. Record labels have complained about Apple's strict pricing when it comes to iTunes tracks, arguing that the different tracks should have variable pricing. They've also complained about not getting in on hardware sales, arguing that their music pushes iPod sales.
That seems a bit backward. If anything, they should be happy one company has come up with a viable music marketplace to sell digital downloads, because free music is still fairly easy to find on the Internet tubes. The Zune will keep the iTunes price point, but acceding to a device surcharge is Microsoft's way of cozying up to Universal, getting preferred licensing (which could lead to exclusive availability, or perhaps just early releases on the Zune marketplace).
Apple has maintained their price point despite industry pressure (with Steve Jobs calling the industry "greedy" in a delightful sound bite). Microsoft has typically maintained a more conciliatory stance with industry leaders, especially with regards to protecting content, so it will be interesting to see how many more deals like this are made and what effect this has on Zune's content availability.
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I don't know about this move by BGates and crew. I was liking what they had been doing up until this.
Dave Park
[...] Original post by prefix magazine - hip hop to indie rock: music news, reviews and interviews. Updated daily. [...]
Permanent Link to Microsoft paying Zune per-unit b
[...] As previously covered, Microsoft will be paying a charge for every Zune sold to Universal. In a statement sure to endear him to music lovers who own any MP3 player, Doug Morris said “These devices are just repositories for stolen music, and they all know it … So it’s time to get paid for it.” Hell, he should just file a lawsuit on every iPod owner and get it over with. [...]
» Universal CEO calls iPod owners thieves &r
[...] Lee is reported as responsible for the $1 tax Microsoft pays to Universal for each player sold. Unfortunately this bit of corporate kowtowing didn’t protect them from restrictions on Zune’s much-touted sharing capabilities. When you sell out to a major label, and have little to show for it, clearly you’ve got problems on your hands. [...]
» Zune’s failures lead to heads rollin