Yahoo Announcement will raise the price of Portable Music Downloads

October 22nd 2005

Yahoo announced that their subscription music download service will increase prices.  They plan on doubling their monthly fee from $4.99 to $9.99 for customers who buy their service on an annual basis.  Others that pay by the month will see their service fees increase from $6.99 to $11.99 per month. 

This service has been for users who transfer their music into portable devices or onto CDs.  It is similar to other services including Napster LLC and RealNetworks.  Yahoo allows unlimited downloads but requires a monthly payment to listen to them.  If a user wants to permanently keep a song they must pay 79 cents for that right. 

Apple Computer Inc.’s iTunes has no monthly fee and basically sells the songs outright for 99 cents per tune.  Buymusic.com and Wal-Mart offer competitive services.  Wal-Mart charges just 88 cents per song. 

Yahoo has offered existing customers the opportunity to lock-in their subscription at $59.88 for one more year.  Also customers that don’t wish to transfer songs to their portable devices only need to pay $6.99 per month. 

Some record executives have complained that Apple’s 99 cent price is too low.  They feel the low price won’t generate sufficient income to cover the recording company’s expenses.   Apple CEO Steve Jobs has called the recording industry “greedy” and warned them that customers may resort to illegal file sharing if they raise the price. 

Several years ago Yahoo bought Broadcast.com making Mark Cuban an instant billionaire.  Broadcast had been a free service allowing users to listen to a multitude of radio stations over the internet.  Soon after the purchase, there was a lawsuit filed by a commercial actors union effectively shutting down most internet radio broadcasts. 

Yahoo morphed Broadcast into a service called Launch. Yahoo has tried to provide both a free and pay music listening experience implementing basic artificial intelligence to determine what a particular listener is interest in.  The free service is packed with ads, even more so that many radio stations. 

If a listener has broadband and doesn’t mind the commercials there are other services available.  One popular service is Rock.com.  Another popular service is StreamAudio.com.  Stream Audio also includes dozens of talk radio and news stations.  There are thousands of radio stations available over the internet.     

By Dan Wilson
Best Syndication Staff Writer

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