Digital Media

(Credit: The Beatles)

No, the digitally remastered Beatles catalog hasn't come to Apple's iTunes. But it has come to an apple-shaped USB device.

Retailing for $279.99, the collection will be released December 8 in North America, three months after the September 9 release of the remastered set of the band's albums (as well as The Beatles: Rock Band video game). The apple shape is in reference to Apple Corps, the Beatles music publisher--which in the past, you may recall, sued tech giant Apple in a trademark dispute.

(Credit: The Official Beatles Shop)

When the release of the remastered Beatles catalog and Rock Band game were announced for September 9, 2009 (the band has a song called "Revolution 9"), speculation arose that a concurrently scheduled Apple Inc. announcement might bring the catalog, still unavailable for digital download on the Web, to iTunes. That didn't happen. But with the release of the USB collection, the albums are available in non-CD digital form for the first time.

In addition to MP3 and FLAC versions of 14 stereo titles, according to a release, the 16GB device contains "all of the remastered CDs' visual elements, including 13 mini-documentary films about the studio albums, replicated original UK album art, rare photos and expanded liner notes."

Correction 10:45 a.m. PST: This story initially misstated the release date. It is December 8 in North America. Also, the type of lawsuit Apple Corps filed against Apple Inc. has been corrected. It was a trademark dispute.

Would you pay $30 a month to watch TV via iTunes?

That's the pitch Apple has been making to TV networks in recent weeks. The company is trying to round up support for a monthly subscription service that would deliver TV programs via its multimedia software, multiple sources tell me.

Apple isn't tying the proposed service to a specific piece of hardware, like its underwhelming Apple TV box, or its long-rumored tablet/slate device. Instead, it is presenting the offer as an extension of its iTunes software and store, which already has 100 million customers.

A so-called "over the top" service could theoretically rival the ones most consumers already buy from cable TV operators--if Apple is able to get enough buy-in from broadcast and cable TV programmers.

That's a big if: Apple has told industry executives it wants to launch the service early next year, but I have yet to hear of a single programmer that has made a firm commitment to the company, which has tasked iTunes boss Eddy Cue with promoting the idea.

But industry executives believe that if anyone jumps first, it will be Disney, since CEO Bob Iger has shown a willingness to experiment with Apple and iTunes in the past: In 2005, Disney was the first player to sell its programming on iTunes, via a la carte downloads. And Apple CEO Steve Jobs is Disney's largest single shareholder, a result of Disney's 2006 acquisition of Jobs' Pixar animation studio. Apple didn't respond to requests for comment.

Network executives I've talked to are intrigued with the idea--they are eager to find new revenue streams--but are also wary, for multiple reasons.

Story Copyright (c) 2009 AllThingsD. All rights reserved.

Songwriters, composers, and music publishers are making preparations to one day collect performance fees from Apple and other e-tailers for not just traditional music downloads but for downloads of films and TV shows as well. Those downloads contain music after all.

These groups even want compensation for iTunes' 30-second song samples.

In the future, Apple may be required to pay licensing fees to ASCAP and BMI for the downloads of TV shows and films it sells.

(Credit: Apple)

At a time when many iTunes shoppers are still fuming over Apple's first-ever increase in song prices, the demands by the American Society of Composers, Authors and Publishers (ASCAP), Broadcast Music Inc. (BMI), and other performing-rights groups, would likely lead to more price hikes at iTunes. For many, this would also undoubtedly confirm their perception that those overseeing the music industry are greedy.

For those reasons, composers and songwriters will struggle to sell their case to the public. But these royalty-collection groups say they're at the bottom of the music-sector food chain and aren't trying to gouge anyone. They say their livelihoods are threatened and wonder why movie studios, big recording companies, TV networks, and online retailers are allowed to profit from their work but they aren't.

"We make 9.1 cents off a song sale and that means a whole lot of pennies have to add up before it becomes a bunch of money," said Rick Carnes, president of the Songwriters' Guild of America. "Yesterday, I received a check for 2 cents. I'm not kidding. People think we're making a fortune off the Web, but it's a tiny amount. We need multiple revenue streams or this isn't going to work."

An Apple spokesman declined to comment.

ASCAP and BMI have their sights set on collecting fees from three main areas: downloads of music; downloads of films and TV shows, and 30-second song samples.

In case you don't know the lingo of music licensing, here are some important definitions. When music is performed in public, say at radio stations, restaurants, or sports stadiums, groups such as ASCAP and BMI collect fees and pass them on to composers and songwriters. This is different than a "mechanical" licensing fee, which is paid for the right to record or distribute a song (ASCAP and BMI don't collect mechanical fees).

"In the U.S. while we do get paid a mechanical (licensing fee) from ITunes, we are not getting any performance income from Apple yet," David Renzer, chairman and CEO of Universal Music Publishing Group, said in interview late last month with entertainment-industry publication, Encore. "(On iTunes) you can stream radio, and you can preview (tracks), things that we should be getting paid performance income for.

"Also, if you download a film or TV show," Renzer continued, "there's no performance (payment) and typically there's no mechanical (payment) either."

Taking their case to Congress
Apparently, the music industry can't obtain the fees through negotiations. They have begun lobbying Congress to pass legislation that would require anyone who sells a download to pay a performance fee, according to David Israelite, president and CEO of the National Music Publishers Association.

"If you watch a TV show on broadcast, cable or satellite TV there is a performance fee collected," Israelite said. "But if that same TV show is downloaded over iTunes, there's not. We're arguing that the law needs to be clarified that regardless of the method by which a consumer watches the show there is a performance right."

Israelite acknowledges that the legislative efforts to this point have produced little. And they won't produce a thing if Jonathan Potter gets his way.

Potter is executive director of the Digital Media Association (DiMA), a trade group that represents Web music services and media companies, such as RealNetworks, Pandora, and Apple.

He stresses two points.

First, publishers, composers and songwriters do get paid for music inserted into TV shows and movies. A production company must pay a "synchronization" fee for the right to include a song in any show or film. Then, once the show airs or the film is screened, the music guys will require a separate payment from TV networks or studios for performing the music publicly. Israelite confirmed this.

Critics argue this is double dipping.

Israelite makes no apologies. He says that synchronization and performance fees cover very different rights. To illustrate the point, he says not all composers receive money from TV and films. Say, for example, a TV show licenses a popular tune from singer Aimee Mann or the rock band The Fray. Those acts would likely be paid both sync and performance fees. But the person who writes the little-known background music heard during a fight scene may not see any sync money. That's because traditionally, composers of this kind of production music gave away sync rights in the hope they would make money from performance fees.

"This is really a fight about the future," Israelite said. "As more and more people watch TV or movies over an Internet line as opposed to cable or broadcast signal, then we're going to lose the income of the performance. For people who do production and background music, that's how they make their living."

Potter says he is very sorry for those people. But if their income is drying up--this was the second major point he wanted to make--their troubles are not the fault of iTunes, Amazon, or consumers.

"These guys are afraid that the business model is shifting away from public performances to a model of private performances," Potter said. "This is a turf battle. They are saying, 'The songwriters aren't getting paid.' Baloney. Songwriters are getting paid. They're paid sync rights and (mechanical) rights. They aren't getting paid for the public performance in a download because there is no public performance in a download."

Downloading count as a performance?
Whether downloading a song from the Web should be considered a performance is much contested. So far, the courts have sided with digital media companies.

In 2005, ASCAP entered into a rate-court proceeding to set licensing fees for the music services of Yahoo, AOL, and RealNetworks. A U.S. district judge for the Southern District of New York delivered a blow to composers and songwriters by ruling that downloading music from a Web store was not a music performance. On the other hand, the judge found that streaming music was subject to a performance fee.

"The songwriter gets a performance fee if the song is streamed without the video," Carnes noted. "But if it is downloaded within an audio-visual work like a movie we don't get a performance fee--same song, no money."

ASCAP has appealed the decision and arguments in the case will be heard later this year.

Of all of the efforts to collect performing-rights fees, few will likely be more controversial than trying to charge for 30-second samples. These are the previews iTunes offers so users can test drive a song and hear what they're buying. According to sources close to the company, iTunes has acquired licenses to offer the previews but hasn't paid anything for them. According to Renzer's comments, music publishers want that to change.

Potter from DiMA argues that copyright law protects Apple and music stores from being charged performance fees for in-store sampling.

"They are picking on Apple because they say Apple is making a bundle of money," Potter said. "But these companies should be thrilled that Apple and the other services are selling music and generating millions, maybe tens of millions, in royalties."

If you were hoping for Apple to announce a subscription-based music service for the iPhone and the iPod Touch on Wednesday like I was, suppress your disappointment: early this morning, Apple approved Rhapsody for iPhone, and it's available in the iTunes Store.

It's the second such service Apple has approved, but the first, Spotify, is not available in the United States. (The Rhapsody application is not showing up in search results quite yet, but it is showing up within iTunes.)

(Credit: Rhapsody)

Rhapsody was a pioneer in subscription-based music, and I'm a big fan of the service; in 2005, it was the first one to turn me on to the thrill of chasing your whims and surfing randomly among genres, which you can't do with per-download services like iTunes.

In my most recent trial late last year (in conjunction with the Sonos multiroom audio system), I wasn't able to find any significant gaps--if anything, there was too much music, including more versions of the novelty song "Kung Fu Fighting" than I ever imagined--and there is some excellent curation and editorial work, particularly for indie rock artists.

The iPhone app is pretty straightforward: you can search for songs, surf genres and chart-toppers, and create queues and playlists. If you're a fan of Pandora, you'll also appreciate the Rhapsody Radio feature, which creates tailor-made stations built around particular artists or genres. As long as you have an active Wi-Fi or 3G connection, the music should keep playing without interruption.

It's a free download, but to use it, you'll need a Rhapsody to Go subscription, which costs $14.99 a month. That's not quite as good a deal as Microsoft's Zune Pass, which costs the same and gives you 10 permanent MP3 downloads a month, but of course that service requires a Zune, which means that it applies only to about 1.1 percent of the MP3 player market (according to a statistic that Apple snarkily included in its presentation Wednesday) and exactly zero mobile phones.

Apple appears to have seen the light, as it is now allowing subscription-based music to come to the iPhone. It makes my phone's 8GB storage size seem a lot less limiting.

Follow Matt on Twitter.

Apple has obtained the rights to offer ready-made ringtones for the iPhone and managers are trying to have them available in time for next week's press conference, music industry sources told CNET News.

Owners of Apple's iPhone have long had the ability to create custom-made ringtones for their devices. The new music snippets are mainly a convenience, as they make it possible for iPhone owners to obtain a pre-cut ringtone instead of having to create their own.

Apple will announce the ringtones on September 9, the day the company has scheduled a press event, if managers can get them ready in time to sell, the sources said. An Apple spokesman declined to comment.

At the event, Apple is expected to roll out a new digital album cover codenamed Cocktail. There are also persistent rumors that upgraded iPods will also debut. Because Apple has scheduled the event for a Wednesday, instead of the company's preference to make announcements on Tuesdays, there is speculation that there could finally be an announcement that a Beatles catalog is coming to iTunes. September 9 is also the day the Beatles' remastered digital albums and Rock Band video game will be released.

As for ringtones, they have been a boon to the music industry. In the past, consumers have shown a willingness to pay as much as $3 to hear a few seconds of a favorite song when receiving an incoming call.

For that reason, ringtones have offered music labels and retailers better profit margins full song downloads, which typically sell for between 79 cents and $1.29. My sources didn't know what Apple will sell the ringtones but said they expected them to go for far less than $3.

Whatever price Apple chooses, there are those that say the ringtone craze is in decline. SNL Kagan, a research firm, issued a report earlier this month that said ringtone sales dropped from $714 million in 2007 to $541 million in 2008, or 24 percent.

That was the first time mobile music registered overall sales decline, according to Kagan. Part of the reason for the drop off, according to the research firm was that consumers have learned to create their own ringtones out of downloads.

Sites such as Makeownringtone.com allow users to upload a song in MP3, WMA or other formats, choose the section of song they want, remix their music selection, and upload the finished product to their phones.

On September 9, the Beatles will release their entire catalog, digitally re-mastered for the first time, on CD. The same day, The Beatles: Rock Band will be released, and there is speculation of an Apple music-related event the same day. Could it be an entertainment perfect storm?

(Credit: The Beatles)

What is it with the Beatles and nines?

As my colleague Caroline McCarthy pointed out in March when the launch date (September 9, 2009) for The Beatles: Rock Band was announced, the band's song "Revolution 9" ends with the words, "number nine, number nine, number nine."

So clearly, the date 09/09/09 has at least some symbolic significance for the band. And now, in addition to that date being the launch of the Rock Band title, it was announced Tuesday that on that same day, the Beatles will release a CD box set of their entire catalog, digitally re-mastered for the first time, re-confirming reports from months ago.

At the same time, many people have been talking about the high likelihood of an all-music-related Apple event around some unknown product announcement on September 9. So, with all these facts--and some informed speculation--in hand, one has to think seriously that we may get a star-studded event with Paul McCartney and Ringo Starr (who, you may remember, showed up at Microsoft's E3 press conference to promote The Beatles: Rock Band) and, of course, Steve Jobs, to announce the availability of that same digitally re-mastered catalog on iTunes.

If that were to come to pass, it would seem to me an entertainment perfect storm. Of course, as is always the case with these things, we have to temper our enthusiasm because the most exciting speculation could well turn out not to be true. But if it does happen like this, well, it would easily be worth the price of admission.

As for today's news, EMI Music and Apple Corps--the Beatles' publishers--said that it took engineers at the famed Abbey Road Studios four full years "of utilizing state of the art recording technology, alongside vintage studio equipment, to create these amazing re-masters."

Having talked to the folks behind both The Beatles: Rock Band and the Cirque du Soleil's Beatle-themed "Love" about the re-mastering processes, I know that this is something that those involved with the band have been putting a lot of effort into over the last few years. And assuming that there will be a digital distribution element to this whole 09/09/09 thing, it's nice that after being very strict for years and years about how their music got out into the world, the band may finally have agreed to loosen the reins a little bit.

Of course, it's not altruism. There will no doubt be massive amounts of money flowing into the coffers of everyone financially involved with the band. And that's because even for people like me who already own the entire catalog on old mono CDs or records, there may be a few extra dollars available for legitimate digital copies of songs like "Hey Jude," "Yesterday," and "A day in the life."

But, of course, as of today, we don't know anything for certain about the Beatles and iTunes. What we do know is that The Beatles: Rock Band will have 45 songs, and that the digitally re-mastered CD collection will comprise all 12 Beatles studio albums--in stereo, no less--as well as "Magical Mystery Tour" and a combined "Past Masters Volume I and II," for a total of 14 titles on 16 CDs. The whole thing will be available, along with a DVD set of Beatles documentaries in one--presumably pricey--stereo boxed set.

The Downward Spiral, the Nine Inch Nails album that caused Trent Reznor's big rant against Apple.

Well, Apple has finally approved an update to the official iPhone app for industrial-rock band Nine Inch Nails, after previously rejecting it due to objectionable content pertaining to the band's 1994 album "The Downward Spiral." No changes were made from the rejected version

Maybe Apple relented just to shut up NIN frontman Trent Reznor, whose bloggy rant against Apple was pretty much the equivalent of trashing Steve Jobs' hotel room. Not only did he tell Apple to "think your policies through and for f***'s sake get your app approval scenario together," good heavens, he compared Apple to Wal-Mart!

But he had a point. Apple's commitment to standards of decency in the App Store has been schizophrenic at best: it yanked the otherwise harmless "I Am Rich," a moderately hilarious ploy at making well-moneyed doofuses cough up $1,000, but approved the disturbing "Baby Shaker" until a flurry of press saw it taken down. Don't even get me started on fart apps.

But fans of Reznor rage needn't worry. The rocker has plenty of other beefs with the evolving digital music industry, particularly when it comes to experimental online retail. And he's got that five-word Webby Awards speech to look forward to. Let's hope he chooses his words well.

Updated at 12:45 p.m. to include quotes from Harvard economist Anita Elberse.

If iTunes shoppers truly believe in our free-market system, then they shouldn't worry about a $1.29 price for songs.

On Tuesday, Apple's traditional 99-cent song price was shelved. From now on, record labels can choose to charge $1.29 for new releases. Some older catalog titles will sell for 69 cents, and everything else will be available for the tried-and-true 99 cents. CNET first reported the price changes in January.

The blogosphere is full of gloomy warnings about how Apple's new pricing structure will alienate customers. But aren't consumers supposed to have the final say on market prices, at least in theory? Earlier in the day I wrote that if shoppers reject iTunes' three-tiered pricing scale, the big recording companies and Apple will be forced to retreat. I've since talked to a Harvard economist who told me that's not necessarily true.

Anita Elberse, associate professor at Harvard Business School, says each consumer has a "reservation price," or the maximum price they are willing to pay. Even if some consumers are not willing to pay the higher price, it is unlikely that all consumers will refuse to pay more--particularly the most avid fans of an artist. Collectively, consumers may not be nearly as powerful as some assume.

Elberse said finding someone's reservation price, however, is very difficult. She said the key question for Apple and the music labels is whether the people willing to pay 30 cents more for a song can make up the losses from those unwilling to pay.

"Most people in the industry that I've talked to say, 'yes, it's going to make up for that," Elberse said. "We might lose some people that are dropping out because their reservation price is below $1.29, but we make it up when we get 30 cents more from the people that stay. That is constantly the trade-off that you make."

There are limits to this concept, Elberse said. Apple could "jack up the prices to $10, and sales of music at that figure may not cover the losses from people who would refuse to buy at that price."

The new pricing scheme at iTunes could test customer loyalty like never before. Since launching in January 2001, iTunes has been synonymous with digital-music sales. Prices at the site have cost 99 cents for over five years.

The strategy has served Apple well. A recent survey by research firm NPD Group showed that 87 percent of people who buy digital music in the United States download from iTunes.

Why change now?

For years, the four biggest record companies have clamored for more control over pricing on iTunes. Apple relented, presumably in exchange for the right to sell songs stripped of copy protection software.

The big question is what the new prices will mean for Apple and the music industry.

After doing numerous tests, the big labels are confident that music fans will pay $1.29 for hit songs, according to industry sources. But in these uncertain times, determining what kind of revenue this might generate is unclear, the sources said. The recording industry is hoping that charging 30 cents less for older titles than iTunes' traditional 99-cent standard will reinvigorate sales.

It must be noted that most of the prices on iTunes are unchanged or reduced. Brad Stone at The New York Times found that of the 100 best-selling songs, only 33 are now selling for $1.29.

Of course, the music industry is trying to make up for dwindling CD sales and the losses from illegal file sharing. A lot of digital-music fans see the struggles of the recording companies as self-inflicted. They are unlikely to dig deeper into their pockets just to help the industry.

Music fans likely will do what they have always done; pay for those songs they value. Most certainly, they will vote on iTunes' new pricing with their dollars.