Did No One At eMusic Think About PR Impact Of Raising Prices At The Same Time Sony Signed?

from the braindead-PR dept

eMusic is a rather successful indie music e-commerce player (reports put it at the 2nd largest music store), that has focused on charging people a subscription that lets them download a limited number of songs each month. It also supported DRM-free MP3 files long before others finally came around. I have many friends who love the convenience that eMusic provides (I tried it, and didn't find enough of the music I liked to stick around) and are willing to pay for the convenience alone. However, it's almost hard to believe that no one on the PR/marketing side of eMusic failed to predict what would happen this week when the company made two announcements: that it had signed its first major label, Sony, and that it was raising prices. The reaction was quick and almost universally negative.

The complaints hit on a number of points, but the two big ones (obviously) are the price increase and the fact that many people signed up with eMusic because of its indie music focus, and related to that: their dislike of major record labels. What's stunning is that eMusic couldn't foresee what a negative reaction this would bring. The company has raised prices in the past, which also created some level of anger -- but people had to know that announcing both the Sony deal and the price raise at the same time, was going to be a PR nightmare. What I can't understand is why they didn't separate out the announcements. They may have felt it was a "pulling the bandaid off quickly" sort of moment, where they could take flak for both announcements at the same time, but they didn't seem to consider the fact that the two issues are completely linked in users' minds. It's not "eMusic had to raise prices" and "eMusic added Sony music." It's become: "eMusic had to raise prices to get Sony Music's catalog into the system."

That makes both eMusic and Sony Music look dreadful -- because here's a major record label, whose music many eMusic subscribers didn't want in the first place, now being seen as having made life worse (and more expensive) for everyone. By connecting the two issues, it seems like both eMusic and Sony Music are getting hit a lot harder than if the announcements had been separated.

Filed Under: major labels, music, subscriptions
Companies: emusic, sony

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  1. icon
    Dave (profile), 3 Jun 2009 @ 11:15am

    You can make the numbers say anything.

    I agree with you that a 66.6% price increase is no fun. However, if I ditch eMusic for Amazon, which is $0.89 per song on average, it's another 122.5% increase per song **on top of** that 66.6%.

    Yes, I could buy two 15-song albums for $7.99 each, but even then, it's $0.53/song, which is still $0.13/song more than the new eMusic plans and doesn't offer quite the same flexibility -- unless I buy no music for a month, and then I don't get charged at all.

    You could argue that it's still better to go with Amazon, since you're only paying for the music you want, not getting charged if you don't visit the site for a month, and giving more money to the artists who make that music. (Amazon pays $0.40 to $0.65 per song, depending on a few variables. iTunes pays 70% per song and per album.)

    So it's not as cut-and-dried as it might seem at first glance. You might hate the price increase, but if you enjoy the eMusic experience more than Amazon or iTunes, you might decide to stick around anyway. I'm still deciding.

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