A Warner Music executive has threatened to cut off Apple if Steve Jobs continues to refuse to give ground on iTunes Music Store pricing.
Digital strategy chief Michael Nash said during a discussion at a wireless telecoms conference that the music industry has let Apple get too much power in the digital downloads market.
‘What if Jobs says 39 cents or 29 cents per download – what then?,’ he said. ‘The industry can say, OK we’ll cut him off – very few people buy music from digital downloads.’
He added that he is sure that the Apple CEO would find another way to sell iPods.
Nash’s comments echoes those made last week by Warner CEO Edgar Bronfman, who called for Apple to adopt variable pricing and share out revenues from iPod sales.
The record companies’ position is based on the dubious argument that digital downloads sell iPods. In fact all the evidence points to the opposite: that iPod sales have driven demand for downloads. The vast majority of digital music sales are made by iPod owners. Cut off Apple and the labels digital sales will slump.
‘The iPod drives people to iTunes, not the other way around,’ Michael Gartenberg of Jupiter Research told Business Week.
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