Royalty Rate Unchanged; iTunes Stays

Apple had threatened to shutter its iTunes service if royalty rates on downloaded songs went up, but it didn’t happen. A brief AP article notes that the royalty rates were left unchanged for digital downloads and CDs — 9.1 cents per song.

Meanwhile, a writer over at the Motley Fool calls BS on the idea that Apple would ever have shut down iTunes, and explains why. A commenter disagrees, saying Apple could take a short-term revenue hit.

Everybody Talkin’ ‘Bout slotMusic

I was waiting for the music and the albums list, but it’s not available yet, so I better write this up before it gets moldy. A variety of companies have gotten together to announce the upcoming availability of music — DRM-free music — on microSD cards. They’re calling it slotMusic. The microSD cards means that slotMusic will be perfect for cell phones and other devices that use those tiny cards, but releases will also be packed with USB sleeves that make them compatible with desktop computers.

The press release announcing slotMusic mentions that slotMusic will be released from EMI, Sony BMG, Universal Music Group, and Warner Music Group. It’ll first be available in the US from stores including Best Buy and Wal-Mart, with Europe coming later.

The press release mentions that artists will have the option to put other things on the microSD cards — like liner notes and videos — but it’s not clear if the cards will be re-writable or if they’re write once at manufacture. Passing around a bunch of rewritable media sounds very virus-y. It’s also not clear how much these albums will cost. Wasn’t it the case that CDs cost less to produce than cassettes and yet cost more? Is this going to be the same thing?

There’s a Web site at www.slotmusic.org but there isn’t much there yet. You can read the press release at MarketWatch.

I Want to Sell Digital Music with the Idea Box!

Best Buy is going to buy Napster for $121 million in cash. The purchase is seen as a move to compete with iTunes, the 600-million pound gorilla of online music sales and number 1 music retailer in the US.

I’m not surprised that they’d fork out $121 million cash for Napster. Even now it’s still one of the better-known names on the Internet and it’s a quick way into the online music sales market. What I am surprised about is what they’re not spending their cash on. I mean, what is Circuit City’s market cap right now? $275 million?