RIAA to increase music download prices

If Andrew Orlowski is to be believed, the RIAA is planning a price hike for online music downloads (via Slashdot). Possibly as much as tripling prices. Once again, they show that they do not understand their market. The market price for music, especially the most popular songs, is lower than the $.99 that iTunes charges, not higher.

Here's some free advice for anyone from the RIAA who might see this post. People primarily buy music downloads out of convenience. No more digging through the disorganized racks at Tower Records only to discover that they don't carry anything more obscure than Mariah Carey. No more trying to compile a whole Karajan album from LimeWire only to find that the third track is incomplete. It's instant gratification.

The other thing that you need to understand is that as the demand for music goes up, so does its availability on P2P networks. High demand does not cause scarcity like it used to. It's simple for someone to download a complete, high-quality rip of the latest hot single. This means that the market price for that song is essentially zero. The best thing you can do is give the most popular music away hoping that it will entice people to buy more from those artists.*

I think the real money is in the decades of obscure music in your back catalog. The music that's nearly impossible to find. Put it online. All of it. You could even charge more for the most obscure stuff.

But you have to do this now. Waiting around is only going to make things harder down the road.

* Giving away music to entice people to buy more is not going to work with the music you're publishing right now. People aren't stupid. They know that popular albums are mostly made up of filler. Why do you think they download the single for free rather than buying the whole disc? You're going to have to stop pushing trash into the market if things are going to work out for you.