eMusic and Epitaph Records

Epitaph Records has decided to remove all of its music from eMusic because eMusic refuses to sell its songs at 99 cents a track, like iTunes. That’s a real shame, because Epitaph offered some of the most interesting music on eMusic. In announcing the departure of Epitaph, eMusic CEO David Pakman makes the following point:

At a time when the music industry is in such steep decline, our research and experience shows us that consumers are still willing to buy music, provided the value is right. And 99 cents a song is not an acceptable price point for all consumers. That’s one reason why eMusic exists and has been so successful; those consumers who are willing to spend more on music (provided the price is right) do so with us. You spend more than 14 times as much as the average iTunes customer at a time when per capita spending on all music and audio is under $24. You buy twenty times more music than the average iTunes customer.

We know that consumers seeking good value don’t have to buy CDs for $16 or buy downloads for $1 each. They simply go to Amazon and eBay and buy used Epitaph CDs for $3 each. When consumers buy used CDs, as you know, the artist and label don’t get paid at all. Some analysts have estimated that as much as 30% of Amazon’s music business comes from selling used CDs. With facts like these, it’s hard to argue that we, as an industry, can control the price of music. You, the consumers, make that decision and you are telling us what we need to know — you’ll buy more if you can pay less.

The point about used CDs is well taken. Illegal music downloads get a lot of the blame for the woes of the music industry, but I’d love to know the overall impact of used CD sales. He also points out that all of these phenomena have their greatest effect among average music fans. No hardcore music fan worth their salt is going to pay full price for any music recordings unless they’re just feeling charitable. It’s too easy to find better deals.