Big events = bad
A few delays

The Beatles on iTunes, but not in Hong Kong

So the Beatles catalogue is finally available from the iTunes music store. Which is all very exciting. Or maybe not…

OK, there might be a few people with iPods who haven't worked out how to place their Beatles CDs into the CD drive of their computer and then import them into ITunes. It's really not that hard, but maybe some people can't manage it.

There might even be a few Beatles fans who haven't got round to buying the albums 30+ years after they came out, but who would like to have them on their iPods. Or who just want to buy "Hey Jude".

But it's certainly not big news for people in Hong Kong, because we still don't have access to the iTunes music store.

Which begs another question: since it is now ridiculously easy to download any music you might want without paying for it, all this announcement really means is that people now have a way to pay. And pay rather a lot, with individual tracks priced at $1.29 and albums at $12.99.

I really don't understand this pricing. If I buy a physical CD (or a book) it has to be manufactured, it has to be shipped to the retailer (who has to pay rent and salaries), etc., etc. But the marginal cost of an MP3 (or the proprietary Apple format) is effectively zero. Likewise the cost of a Kindle "book".

In a world where items that cost nothing to produce are available free, what is the logic of having a high price for those who choose to pay, and why make it so difficult to buy?

Yes, I know there are ways to buy music from the iTunes store, and I'm sure that it's possible to get around the restrictions that make some titles for the Kindle unavailable in Asia Pacific, but why should I bother? If they don't want my money, then that's their problem and not mine.

See also this earlier post on a similar subject

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

Spike

I don't really understand why you believe that "the marginal cost of an MP3 (or the proprietary Apple format) is effectively zero." The file that you download resides on a server that was purchased and has to be administrated, and is part of a larger architecture that includes all sorts of routers, load balancers, etc. The server resides in a physical environment that has all the attendant real estate costs - actually higher because of the need for better environmental control, power and security. The transfer of a file at near-instantaneous speed requires bandwidth which the host pays for. And then there's marketing, legal, financial and all of the other usual support services that companies have.

As for why there's no iTunes music store in Hong Kong, the answer is obvious. The size of the market plus the effort involved in negotiating rights with all of the local copyright holders plus the cost of implementing infrastructure to support a local store minus the rate of piracy for Apple probably equals zero profits or a loss.

Chris

Of course Apple need servers and bandwidth, but what is the marginal cost of supplying one Beatles track to a customer? Much, much, lower than the cost of a physical CD. We can argue about whether it costs $0.01 or $0.05, but it certainly isn't very much.

You may be right that the cost and trouble involved in negotiating for the Hong Kong rights is prohibitive, but I'm not criticizing Apple as much as the music industry.

Spike

"It certainly isn't very much" is simply a guess on your part though, isn't it? We could also argue about whether it costs $0.05 or $0.25 but I don't have any facts to support any of these price points and I don't think that you have any better basis for guessing than I do. And what is this about "marginal cost" anyway? Recording and promotional costs, songwriters' royalties, producers, engineers, session musicians, the guy who art directs the cover art and the guy who takes the picture for the cover, the guy who designs the ad campaign, the dozens of people doing the music videos, none of that should be figured in there? I'm not saying that they don't make a profit, I just don't think the profit margin is as huge as you suggest.

Chris

I did say marginal cost, and that's what I am talking about.

Brian OConnor

if your iTunes account is connected to the US iTunes store or the UK store can you access it from Hong Kong?

Chris

I think you can. But why should I have to go to all that trouble just to pay for music that is freely available?

Riley

Agree. Wish they'd sort this kind of thing out. I have no idea how to buy mainstream music online legally in Hong Kong (other than messing around with US gift cards or overseas credit cards, etc.), which is ridiculous. Fortunately 80% of what I listen to isn't major label, so I can get it via websites which do sell over here, but it's incredibly annoying not to have access to all of it.

Jabalong

Absolutely right Chris.

Whether it's TV shows that are years behind, movies that are months behind or music that can't be bought digitally in Hong Kong, if entertainment companies can't get their collective thumbs out of their asses and make their product available in the way that people want it now, in a timely fashion and at a price point that's reasonable, then consumers will find other ways to obtain, the entertainment companies won't get a dime and it's too bad for them.

I'm happy to pay, but I'm not going to go out of my way to give money to entertainment companies who through design and/or ineptitude put up barriers to my doing so and getting the product in a way that I want it when I want it. You'd be hardpressed to find another example of an industry faced with a huge demand for its product putting up so much resistance to actually making it available to its customers in the way they want it, rather than it's own outdated ideas of how to deliver it.

Dinosaurs like this really don't deserve to survive into the digital age.

susie

I agree that entertainment companies really should sort themselves out with regard to their digital distribution in Asia. However you're missing a fundamental point when you ask 'why should I pay when I can get it free?'. The revenue from the track doesn't simply go to the big bad record company - mechanical and publishing royalties must be paid to the artist. And mp3s may seem to have limited value to you, but sales and downloads are an essential revenue stream for many of today's artists, now physical sales are dwindling. Particularly less established artists, even if they are signed to majors. It seems odd to me that people are prepared to pay for other artforms - you pay for a painting, you pay to see a play, you pay to go the cinema - but everybody thinks music should be free..? How in that case, does the artist get paid?

It seems odd to me that iTunes isn't available in Hong Kong. Is this still the case?

Chris

I do pay for music. I buy CDs and rip them to my computer and then copy them to my various mobile devices. It's ridiculous, I know, but that's what I do.

I think you missed the point I am making about MP3s. I did say that the cost is almost zero, not that the value is zero. I wrote an earlier post on this very subject: Free doesn't mean worthless

iTunes Music Store is still not available in Hong Kong

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Working...
Your comment could not be posted. Error type:
Your comment has been saved. Comments are moderated and will not appear until approved by the author. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.

Working...

Post a comment

Comments are moderated, and will not appear until the author has approved them.

Your Information

(Name and email address are required. Email address will not be displayed with the comment.)