How to destroy a new business

The WSJ reports today that record companies are discussing raising prices for song downloads. The article says pricing could go to $1.25 to $2.49 from the current 99 cents.

First, the music industry doesn’t understand how online sales can enhance their distribution. The next natural step: when your new distribution channel starts to take hold, raise your prices.

I think 99 cents is too much for a single. I want to point you again to an outstanding essay by Bob Lefsetz. He thinks between 5 and 10 cents is more like it. Imagine how that would change consumption of music online.

One thought on “How to destroy a new business

  1. Pingback: Preoccupations

Comments are closed.