Our fellow blog pundits are having a laugh at Warner Music Group’s Edgar Bronfman Jr. today, based on a speech he delivered yesterday at a wireless convention in Macau (link to full text pdf at end of this story). The punchline: Clueless record executive dude admits he was totally wrong about everything: Apple (AAPL) is great, DRM is bad, everyone should share their files for free! Etc.
And indeed, Edgar does admit that the music business screwed up years ago by not moving quickly and proactively when faced with the original Napster. But that’s not a huge admission these days. More interesting is his call to the mobile business: Please help us sell music via mobile phones – ASAP.
Why? Because while he’s right to note that buying music on your phone remains a difficult, lousy experience, and that much of the problem is a technical challenge the wireless industry has to solve, Edgar could help his own cause considerably. How?
By lowering prices. Right now WMG and most other labels are charging carriers wholesale prices of more than a dollar per song — when the iTunes retail standard is 99 cents per track. That means any carrier that wants to make a remotely competitive offering loses money on each song sold.
You can make an argument that it’s worth it to the carriers to eat the costs, since mobile music consumption drives more data usage, etc. (and Sprint has been trying this tactic, without much success, since last spring). But why not make it easier for the carriers, and at least let them break even? While you’re at it, why not let them underprice iTunes? That way you’d accomplish two goals: Give consumers a reason to buy music on their phones — and finally provide real competition to Steve Jobs’ digital music monopoly.
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