Universal Flexes Muscles, Not Renewing Long Term iTunes Music Contract

Just as Apple was riding high on the iPhone, Ferris Bueller style in a parade of fans and media alike, Universal Music plans to throw a knee into Jobs and Co.'s collective crotch. Universal Music Group will supposedly tell Apple that they will not be renewing a long term contract for iTunes music, instead going for a short-term sales agreement that will still let Apple keep their artists's music up for sale.

This shorter contract benefits Universal by letting it have more flexibility in dealings with other music services, presumably ones like Microsoft's Zune or Rhapsody, or even its own store if it feels up to it. How does this affect you? Our guess is that it won't. Apple will do a lot to keep Universal at the table, which probably means you won't be missing your Alizee or your Amy Grant anytime soon. But it may mean lower profits for Apple itself, and could slow down any efforts in motion to get DRM-free (like EMI's catalog) into iTunes.

Universal Music May Not Renew iTunes Contract [WSJ]

11:04 PM on Sun Jul 1 2007
By Jason Chen
6,032 views
18 comments

Comments

foofighter28 at 11:12 PM on 07/01/07
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universal really likes to screw themselves, first just doing HDDVD and now this??? Did they not see that Apple is the 3 biggest online music retailer?? *sigh*
bobvilla at 11:14 PM on 07/01/07
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ooooo, take that third largest music retailer in the US, and growing.

These music companies are idiots sometimes.
Slappy McSlapp at 11:27 PM on 07/01/07
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Anyone can flex:

[images.jupiterimages.com]
mattjumbo at 11:34 PM on 07/01/07
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Ha!

This is trouble for no one except Universal. Can't wait to see what happens to their stock on Monday.
TRASHMAN at 11:43 PM on 07/01/07
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So how long till we get some news that doesnt have the words Iphone or Apple. Maybe something about the Commodore 64 I'm still using!
blakebell at 12:20 AM on 07/02/07
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just another example of how the music industry has lost touch with their customers, this is why i use emusic, drm free and cheaper than itunes
Falconfire at 12:24 AM on 07/02/07
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emusic is only DRM free because it has no major labels on it, and only some stuff on emusic is cheaper than itunes (some stuff is actually more expensive, and I have been able to find some groups on iTunes who charge 7 dollars or less for a full album from the indie labels on iTunes.
blakebell at 12:31 AM on 07/02/07
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actually emusic is a subscription base with a set amount downloads a month, my plan equals about 30 cents a song, i dont think you can find anything on itunes that cheap, anyways it still drm free regardless ,and most major labels suck anyway, itunes is great for things not found on emusic, which is not too much for me
Levendis47 at 12:46 AM on 07/02/07
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Until these fools (the labels not iJobs and iCompany) figure this game out, I'm sticking with my tried and true method: Buy the CD, Rip it, Tag it, throw in an iPod with baby and me...

Sorry, long night getting the Spawnling to sleep...

Point being... with a CD you get to make your own DRM-free tracks (woohoo!) in whatever format you want that can be shared on just about any device with an mp3 decoder and you have a nice backup copy.

And before anyone starts mewling about "oooh, ripping takes so much time..." I'm 2/3rds the way through a 1200 CD collection and it's only taken me 6 years... okay, not the best track record... but I have ripped ~1/3rd of said collection in less than a week.

Loves my 80gb iPod... Loves IT!

nocte, nocte,
Levendis47
Geraldo at 01:14 AM on 07/02/07
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I wish I cared what a major label did - largest label or not, but I seriously don't care. iTunes has allowed me buy more one-off music / videos that I otherwise wouldn't have bought. Bottom line is that I won't buy a CD unless I really like a lot of the tracks on the CD, but I'll definitely buy one or two tracks on iTunes if I can get it piecemeal.

Love my iPhone, detest AT&T
Love music, detest the big labels...
Dark13 at 01:21 AM on 07/02/07
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Never heard of those bands/artists, and since I listen to metal most of my music is not even available on ITunes.
foofighter28 at 01:21 AM on 07/02/07
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@Geraldo:

i couldnt agree with you more. not every album has great songs
dvnprcsn at 03:13 AM on 07/02/07
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I'm rather curious as to how this came across as negative to Apple. We are talking about the third largest music distributor. The RIAA and it's brethren are in Apple's pocket. It's laughable to suggest this is somehow bad news for Apple Inc. Universal/Island Records/Whatever the hell other aliases/Buyouts is not exactly putting out quality material these days anyway, and it doesn't take a genius to realize you don't piss off one of your main distributors when your product is already failing.
marovada at 07:03 AM on 07/02/07
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Someone's got to get rid of the execs that run these conglomerates. They're old, fat and stupid.

marovada
[freescifistories.wordpress.com]
Promethean at 10:03 AM on 07/02/07
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I don't see anything wrong with this. A shorter contract allows more flexibility in the market to respond to changing distribution models. I think as soon as there's widespread support in players for subsription services, that will be the way people go. I'd love for Apple themselves to offer this, since they have such a nice library already.
jetdillo at 11:08 AM on 07/02/07
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...and just where do they think they're going?
Down the block and around the corner to sulk under a bush and suck their thumb until Dad comes to find them??--Please...
ComicDork at 01:58 PM on 07/02/07
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Yeah, this will last... until Jobs calls his pal Bono.
zair at 03:28 PM on 07/02/07
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The music industry is in trouble. Nobody cares that they're not making as much money because they still make a lot of money. As consumers we care about a few things. Gettng a quality product and getting it cheap. For a number of years cheap has meant free and quality was the best bitrate you could download. This is what the record labels still don't get. DRM has ruined the whole digital music experience. Why deal with incompatible DRM when we as consumers can just download it for free. DRM free music is a big step. A step they need to take.