Apple could shut down the iTunes Store, the world's biggest online music store, if a ruling expected Thursday forces the company to pay more to music makers for each downloaded track.
The Copyright Royalty Board (CRB) in Washington, D.C., will decide whether to grant the request of American music publishers to increase "mechanical" royalty rates on songs bought from online music stores such as iTunes.
The National Music Publishers' Association, which represents the interests of music makers and songwriters in the U.S., wants rates to be increased 9 cents to 15 cents, which represents a 66 percent rise.
Apple has vehemently opposed the move. In a statement to the ruling body in 2008, the company threatened to shut down iTunes rather than raise the price of songs in order to afford the higher royalty rates.
"If [iTunes] was forced to absorb any increase in the ... royalty rate, the result would be to significantly increase the likelihood of the store operating at a financial loss — which is no alternative at all," iTunes vice president Eddy Cue said.
According to another article, recently Apple has sold more than 4.5 billion songs through iTunes in under 2 years, and that adds up to more than $4 billion revenue in sales. My question is if I-Tunes shut down, will it just increase the load of people downloading music off the internet and decrease sales, which doesn't help the economy at all?
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1 comment:
I think if iTunes were to shut down, it would either cause a sharp increase in the number of online (illegal) downloads, or other brands that have been under the radar due to apple's success may be able to take the lead. There are several websites where you can install a media player and "download" music, at a certain cost. If iTunes goes under, music listeners will turn to the next best thing, which may be these other sites
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