Universal Music Group Slashes CD Prices to Between $6 and $10

Universal Music

Universal Music Group, one of the "Big Four" major labels, is the first to react to the years-long decline in CD sales. CD sales are down 15.4% this year, a slightly slower decline than the two years prior but still a huge drop, and though digital sales are nearing the volume of physical sales, revenues are still plummeting. Retailers and consumers alike have clamored for lower prices on CDs, and the labels have responded far too slowly, dropping from $18 to $13 in 2003.

Now, UMG is radically changing the price of the dying format, to between $6 and $10 for single-disc releases. The announcement is making the other labels quite nervous--they'll probably have to follow UMG's lead, whether the program is successful or not, and really, it doesn't matter if it's successful or not, given CDs have precious few years left anyway. But sources from the other labels say that they may simply drop the standard price to $10, which while not as drastic as UMG's strategy may still encourage more CD purchases.

After all, CDs are objectively superior to music purchased from digital retailers like iTunes, Zune, and Amazon. They come with album art and a booklet, they never have DRM, and they're encoded in high-quality lossless WAV files that can then be ripped in any format of any quality the user wants, including several other lossless formats. But on the other hand, buying a CD is certainly a bigger pain than downloading; a user has to get to a store, get home, rip the album, and then move it to a portable device, rather than simply clicking a few times in iTunes. And, of course, environmentally speaking, CDs are far more harmful. Still, if the choice is between a $6 CD or a $9.99 iTunes album, the CD is unquestionably the superior choice.

While this is an encouraging show of flexibility from the notoriously rigid major labels, it's not going to change the basic fact that the move is merely delaying the death of a format. The cut isn't going to "revitalize," "save," or "make viable" CDs: it'll just make them slightly more desirable for a couple of years until digital firmly buries physical.

[Billboard via Gizmodo]

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3 Comments

  • Martyn Cooling

    Its not about the price a $10 price point is fine. Its about making people want to buy the cd. Too many major labels are panicking about sales and profits and rushing bands to market, their throwing cash at 12 acts at a time and hoping one sticks. They should be nurturing acts and making sure their album is a marketable product. The reason people are downloading tracks more than cd's is not because they prefer digital or because of expense, its because its not worth the purchase, can anyone say Ke$ha's album or Katy Perry's latest abortion is worth the money? No, you buy the single and your done.

    Cd sales will plateau soon, as a lot of people prefer cd's and vinyl, labels need to concentrate on making their products more appealing, not lowering prices and making them panic about sales figures even more.

  • FF Architect

    I doubt that CDs even have a few years.

    And, I believe the following line:

    "They come with album art and a booklet, they never have DRM, and they're encoded in high-quality lossless WAV files"

    ...is a bit wacky.

    The Architect
    Fame Foundry
    http://www.famefoundry.com

  • Orrin Edenfield

    You must be forgetting about the Sony BMG DRM fiasco from a few years ago. You should be correct, CDs.. when made properly do not have DRM on them but when long-lost management at record companies make fools of themselves and the companies they run and have their minions invent DRM to be put on CDs.. we end up with DRM on CDs.