What kind of stupid undergrad students willing to pay $1.5 to download a song? The maximum amount I am willing to pay to download a song is $0. Why pay a dime if you can get it for free? A song only worth the cost of electricity and bandwidth to download it.

Oct 22nd 2009 – From The Economist
Uniform prices for online music are no way to maximise profit

THE term “bargain basement” was supposedly coined to describe the first outlet of Filene’s Basement, an American discount shopping chain whose bags scream “I just got a bargain!” in large red letters. Those bags celebrate a feeling most shoppers will be familiar with: the pleasure of having bought something for less than they were willing to pay. This difference between the price paid and the most a buyer would have agreed to shell out is known as “consumer surplus” and is the part of the overall economic benefit from any trade that the buyer gets.

The rest of the surplus from a trade goes to the seller. To maximise his share of the economic surplus, a merchant wants to sell to each customer at a price as close as possible to the most that client would be willing to pay. Naturally this is impossible if everyone is charged the same price. Buyers who would have been willing to pay more get a big chunk of the surplus, leaving less for the seller. In addition those willing to pay less than the uniform price are simply left out, even though they may be willing to pay enough to allow costs to be covered. Lowering the price enough to attract them would reduce the amount that customers who value the product more could be charged, reducing overall profit.

Where possible, the solution is to tailor prices to people’s willingness to pay or price-sensitivity, much as vendors in street markets do when they offer naive tourists a higher price than seasoned locals. Most of the time it is hard to know how much people value things. But sellers can still encourage people to sort themselves into groups which can be charged different prices. Those who are particularly keen to get their hands on a copy of a new book, for instance, may be willing to pay a higher price for it, which may explain the persistence of expensive hardbacks. The logic behind cheaper student editions is similar.

These tactics and others, like selling things in bundles rather than individually, all exploit differences in people’s sensitivity to price. They ought to be better for sellers (and possibly for some customers too) than a uniform price. So many found Apple’s initial pricing strategy on iTunes, its popular online music-store, perplexing. Until April this year, when it switched to a multi-tiered pricing system, every song available on iTunes cost a uniform 99 cents in America, 79 pence in Britain and so forth. This had the benefit of simplicity. But it seemed likely that other ways to price music online would be more profitable.

Knowing how sellers and buyers would act under different pricing schemes requires information about how those who buy music online value different songs. New research* by Ben Shiller and Joel Waldfogel, two economists at the University of Pennsylvania’s Wharton business school, tries to answer this question. In January 2008 the researchers presented nearly 500 undergraduate students at Wharton with clips of the 50 most popular songs on iTunes earlier that month. Having listened to each clip, the students were then asked to write down the most they would be willing to pay to download the song in question. Data on more than 23,000 song valuations resulted, allowing the professors to get a sense of the actual demand curves for popular songs. Similar data were also collected in January this year, though this time some older and less popular tracks were also included.

The exercises showed that even a uniform price per song that maximised revenue among the students was quite high—$2.30 in 2008 and $1.46 in 2009. Wharton students may be particularly fond of music, but it is also possible that the market would sustain a higher uniform price than 99 cents. More important, knowing the uniform price that maximised revenue also allowed the authors to evaluate other ways to price online music.

One alternative is song-specific pricing, much favoured by record companies. (Apple has already moved a bit in this direction with its multi-tier system.) But the research suggested that this would increase profits by a mere 3%. Part of the problem was that people who valued one song highly also tended to place a high value on others. This implies that person-specific, rather than song-specific, pricing would be more efficient. But sellers’ data are not refined enough to set different prices for different people. People may resent such pricing anyway, so it could harm sellers’ brands. Crude profiling—by race or sex, say—would be illegal. In any case, the authors found that basic demographic information did not tell them much about musical tastes.
Rhythm ’n’ choose

Charging an “entry fee” for use of the service and then a small, fixed per-song cost for downloads turned out to benefit both the seller and the buyer. The most revenue, according to the 2009 survey data, would be generated by charging the students $21.19 for entry and 37 cents a song. This could raise the producer surplus by 30% compared with uniform pricing. Consumer surplus would also rise in this instance, because some people would buy songs they would have not have done at a higher uniform price. Spotify, a rival to iTunes, has a model somewhat like this for its premium service, where it charges a monthly fee for songs without limit.

Selling several songs together in a bundle (much like an album) had almost identical results. The authors reckon that there is a range of prices for bundles that would make both buyers and sellers better off than a single price per song. For example, charging $16.95 for all 50 songs studied (which would have cost $49.50 to download) would leave profit unchanged because enough people would buy. But it would increase consumer surplus by around 50% by attracting new buyers. The costs of implementing pricing schemes go up with their complexity. But it should be possible to set prices that both increase profits and leave at least some music-lovers with the thrill of a bargain.

Today, everyone is talking about Michael Jackson passed away. I hear it at work, I got it from the front page of the newspaper, I got it from the headline of the evening news, and I got it in almost every blog I visit. I can’t even escape from Michael Jackson visiting friends tonight, the host of the house party is playing Michael Jackson.

Michael Jackson maybe the an pop icon, he maybe very talented, but I never like him and never will. To begin with, I am don’t like dance music and I found his songs are too noisy to listen. When he was really popular in the 80′s, I don’t understand why people love those silly dance moves. Then in the 90′s Michael simply became a laughing stock in the music industry. After many failed plastic surgery, his look resembled the apes in the movie Planet of the Apes. Later on his pedophile scandal make totally bankrupted his character.

He may left behind many legendary work in the mind of his fans. To me, all I remember about Michael Jackson are the funny moonwalk, a really stupid computer games featuring him using moonwalk to kill aliens and the dirty dance in which he keep touching his lower part. I guess I just have to bare the endless media coverage about Michael Jackson in the next few days until everyone finally get tried of him and move on.

說完全沒有買唱片也不是全對﹐只不過沒有買中文歌曲的唱片倒是事實。我還一直唯一有買的碟是西村由紀江的音樂﹐除了最新那一隻還未有時間買外﹐我有 齊了她的全部作品。唱片對於我來說的只有用來收藏的價值﹐就算是西村由紀江的正版碟﹐我甚少拿出放在唱機來聽﹐多數也只是聽在電腦中的mp3版本﹐或者抄 出來放在車上聽的那一份CD。那套西村全集與其說是收藏品﹐不若說是裝飾品來得更貼切﹐當朋友來家中探訪時﹐他們總會暗地觀看主人家愛聽的音樂去衡量那人 的性格﹐我總不成開著電腦給人溜覽﹐或者要人家看我的那堆DVD R封面的字吧。放一套品味獨特的音樂全集在架上﹐就很容易可以把自己的性格特顯出來。

我好些朋友和一些在網上的板友常常有一種想法﹐他們認為下載歌曲是不對的是犯法的﹐雖然他們很多自己也會照樣聽mp3﹐但他們多多少少一丁點兒漸愧 的罪惡感。可是我的想法和他們截然不同﹐下載mp3是犯法那又如何﹐可是不道德的不是犯法的人﹐而是那些現今無理的所謂知識產權法律﹐根本全是資本家弄出 來剝削消費者。分享音樂只不過是我們為保障自己權利而作出公民抗命的行為。我認為知識是無形無價的﹐而在自由市場的經濟機制下﹐不應該用法律手段去給知識 販子販賣的專利。版權長達死後九十九年期﹐不是正好違背了知識產權的立法精神嗎﹖其詳細的論點我不在此申述了﹐有趣興的朋友可以參考拙作舊文 – 淺談知識產權。

張衛健說過“無錢就唔好學人聽音樂”﹐我倒想回應他一句﹐“想賺大錢就唔好搞音樂﹐唔好把藝術矮化為商品。”真正熱愛音樂的人喜歡是找到知音人﹐越 多人聽他的唱他就越高興才對。當然現實是除非有一份正職﹐玩音樂只是副業興趣﹐音樂人也得吃飯。但一個音樂人非要幾百萬合約費才夠錢開飯嗎﹖一張唱碟買一 般二十美元﹐香港台灣入口的唱片就更加昂貴。但扣除唱片公司行政廣告宣傳費用﹐和明星天價般的酬勞後﹐又有多少是落在幕後真正靠音樂開飯的那班人當中﹖還 未說那些換湯不換藥﹐只多一首半首歌的特別版﹐不是出碟搶無知歌迷口袋中錢又算是什麼呢﹖

原則上我不反對聽音樂要付錢﹐只要付出的金錢合理﹐例如boxup的會費。最好是五十至一百美元一年任聽任下載﹐多一個人下載音樂的成本是零﹐每年 人均唱片上的消費也只是這個數目﹐所以基本上唱片公司沒有什麼捐失。若要逐首歌曲收費也可以﹐除了每首歌的金額不可以高於現時CD價錢﹐如Apple i-Tune的一元一首歌外﹐更重要的是引入三十日內退貨原銀奉還﹐以及下載歌曲二手市場買賣的制度。因為值得收藏反覆重聽的歌曲真的不多﹐沒有理由一首 好聽的歌要付出的錢和一首不好聽的歌一樣﹐而沒有細心的聽過又怎知一道歌是否好聽呢﹖

不過聽音樂要收錢也只是治標不治本﹐不能挽救已經沉淪了的音樂工業﹐最重要的是把現今整個賣歌賺錢的觀念改變過來﹐把賣歌所得的錢全給幕後工作人 員。而歌曲本身在收回幕後製作成本後基本上是免費送出去的﹐歌星受歡迎有人氣去拍廣告或開演唱會才是賺錢的主要途徑。價格低廉而歡迎分享音樂的環境下﹐才 可以孕育出音樂中的藝術﹐好歌就自然會有人欣賞﹐而歌者的名利亦會隨之而來。這亦可以減少唱片公司大灑金錢﹐去製造那些連歌也唱不好的紙上明星﹐最終的目標是杜絕唱片公司這一隻在音樂上寄生蟲。音樂是屬於對音樂有熱誠的創作人和歌手的﹐而不是屬於坐在冷氣房中﹐滿腦子只想著如何用音樂去賺錢的生意人。

所以支持和熱愛音樂的人不要買正版碟﹐你們那樣做只是在慢慢地殺死音樂﹐讓唱片公司繼續壟繼和主導音樂市場﹐為我們製造出一那些垃圾般的噪音﹐掩蓋 過真正屬於音樂的聲音。請多購票去聽現場音樂會支持你喜歡的歌星﹐亦在各大流行榜中投票支持他們﹐為他們製造人氣吸引廣告商。更重要的是把你所喜愛的歌曲 分享出去﹐讓更加多的人認識和喜歡他們。而以業餘樂評人的身份在網上寫點碟評﹐不受唱片商影響地向其他網友評介新碟﹐也是在為推動音樂出一分力哦。