10/12/10

eMusic Adds Universal, Changes Their Pricing Model...Again

eMusic will be expanding their music catalogue again, and changing their pricing structure again, as well.  The online music retailer struck a deal with Sony last summer and added Warner to their roster this past January.  And last week they announced they would be adding "more than 250,000" tracks to their database, thanks to a new deal with Universal Music Group - which includes, among many, many others, Def Jam (classic hip-hop), Verve (classic jazz), and Deutsche Grammophon (classic classical).  Fascinatingly, eMusic CEO Adam Klein refers to this new influx of music as a "slug."

All of this is exciting, but I was a little saddened to see that once again eMusic will be changing their pricing model.  I get it, they need to stay competitive, what with 99-cent tunes available on iTunes, and daily MP3 deals on Amazon, etc.  But how many times are they going to change their model in a 1-year time span?  This isn't just a change in how albums are priced, it's actually a fundamental change in the underlying currency - instead of paying for a subscription then getting credits to spend on downloads, you'll soon pay for a subscription then use that actual money to buy downloads.  Here's how they explain it in their update to subscribers:

In order to continue to grow our catalog and to insure a sustainable business in the long term, we need more flexible pricing. So we are changing from today’s credit-per-track system to currency pricing. Your membership will continue just as it is today and your monthly payments will not change. But starting in November, you’ll see tracks and albums priced in dollars and cents instead of credits.
I see good news and bad news here.  The good news is that the major labels are finally starting to understand that DRM is, on the whole, a bad (and very anti-customer) idea.  They're getting on board with the idea that an MP3 is something you can buy and sell, and that you don't need to attach handcuffs to each one.  Of course they're realizing this at a time when buying and selling MP3s is starting to sound as out-dated as buying a physical CD - everyone knows streaming is where it's at, right?  But still, this is a good thing.  And the fact that eMusic's prices (according to eMusic) will represent a "savings of 20%-50% compared to iTunes a la carte prices" is also a good thing.  So what's the bad news?  The bad news is that by switching to a real monetary price per track/album, eMusic has pulled the curtain back to reveal something which was always true about them, but easier to overlook before:  you are basically giving them an interest-free loan every time you pay your membership dues.  When you subscribe, you are, in essence, buying yourself an eMusic gift card that expires at the end of the year.  Again, this has always been true, but somehow putting real dollar amounts on their wares makes it chafe a bit more.

What do you think?  Are you any more or less likely to become (or remain) an eMusic member based on the new changes to their catalogue and pricing?  What alternatives do you use?  iTunes?  Amazon?  Why?  Let me know in the comments.

4 comments:

bradby said...

I have been an emusic member for 5 1/2 years and im getting out now- I have put up with so many price changes my biggest concern is that I dont trust their pricing model- I expect it to change within a few months again and always get more expensive.

The baiting and switching makes credit card companies with 6 month introductory low rates look like saints...

Bill said...

For existing eMusic users, if they do a little math, they are doing no better and no worse.

I had a 200 credit per month subscription at $80/month. That's 40 cents a song. With the new system, the average price of a song goes up to about 49 cents, BUT eMusic is giving me bonus dollars for my subscription - $98 / month worth of MP3s for my $80 outlay. So I can continue to get my 200 songs for $80. eMusic is pretty much comping me the price difference, and they will do this as long as I remain a member. It's not as if they didn't put any thought into how this affects their loyal customers.

This is still half the price of iTunes or Amazon, so I will continue to purchase twice as many MP3s as I would from another service. I just have to stick to the lower-priced independent releases and avoid the higher-priced Universal titles.

Matty Dread said...

I just put my eMu account on hold while I wait to see what the immediate future might bring. After the initial announcement of coming changes, there has been no further update from the company, and there has been significant negative reaction from users on the forum and elsewhere. I am beginning to think that eMu is having second thoughts about how the rollout is going to take place. I agree with bradby that the changes are a bit jolting and not well planned out. I am reminded of the fact that the Rolling Stones older catalog was available for about a week a couple of years ago before being unceremoniously removed due to some licensing fiasco.

In response to Bill, the average price in the new system is not 49 cents. The majority of tracks will be 49 cents, with newer and more "popular" items up to 89 cents. My current subscription of $14.99 per month used to buy me 50 credits. This has gradually eroded to 37 credits. This works out to slightly more than 40 cents per credit. This means that I am being asked to absorb a price increase of no less than 20%. That's harsh anytime, but especially so in a down economy. The math still works out to be cheaper than iTunes or Amazon, but there are significantly diminishing differences. Given the poor technical quality of many of the files available on eMu in particular, and the shortcomings of mp3's in general, I am likely to go back to looking for bargains on used CD's. I would love to find a legitimate online retailer that offered lossless files, given the fact that I use them for professional purposes, including broadcast and live performance.

For casual listening purposes, the cloud is looking like the wave of the future. There are plenty of streaming options already available, with more on the way.

Bruce said...

The biggest problem for me is that on credits (or dollars) expire every 30 days, even for a yearly subscription. Most albums cost $6-$8, a big chunk of a monthly allowance ($19 including bonus). So I was stuck "rationing" album purchases and "filling in" with tracks on other albums. Purchased booster packs at least allow 90 days. I would reactivate my 6-year subscription if eMusic would roll over unused credits for at least half a year. For now I'm using Amazon etc, so I don't have to juggle.