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Published on Canada Updates (http://www.canadaupdates.com)

Apple's Jobs warns on music pricing

By Ishaan Thakur
Created 2005-09-20 13:48

PARIS : Apple boss Steve Jobs, the man behind the popular iPod digital music player, called the music industry greedy for considering a hike in the price of digital downloads, warning such a move would drive users back to piracy.

Record companies have begun rethinking how to price songs sold over Apple's iTunes Internet shop -- 99 cents each in the United States and 79 pence in Britain -- before new contract negotiations come up with the California-based company.

"If they want to raise the prices, it means that they are getting greedy," said Jobs, chief executive of Apple (AAPL.O: Quote, Profile, Research), at a news conference in Paris on Tuesday.

"If the price goes up, they (consumers) will go back to piracy and everybody loses," he said.

Hit hard over the past five years by the rapid spread of illegal song copying over the Internet, music companies are struggling to revamp their business models as sales shift to more legal digital downloads from the CD format.

Apple, which Jobs said had more than 80 percent of the U.S. digital music market, unveiled this month a pencil-thin "iPod nano" digital music player aimed at securing its lead.

Jon Rubinstein, senior vice president of the iPod division, told journalists the company was not planning to add radio features on to its digital player because there was not enough demand for it.

WIRELESS MUSIC SCEPTICISM

Jobs also cast a skeptical eye on the future of the market for downloading music on mobile handsets.

"It is not clear that buying songs over the air makes economic sense," Jobs said. "I am skeptical because of the cost ... but we will see."

Jobs said it was cheaper for consumers to download songs onto their computer than directly onto their mobile phones.

Mobile phone operators, however, expect music downloads to be a significant driver of revenue growth after having invested heavily in technology and infrastructure to support the service.

Jobs declined to say whether Apple was planning to launch an all Apple-made iPod phone after having introduced two weeks ago a music playing handset developed with Motorola (MOT.N: Quote, Profile, Research).

"We do not say anything about future products," Jobs said. "We work on them in secret, then we announce them."

On a separate matter, Jobs said Apple was on track to ship computers fitted with Intel (INTC.O: Quote, Profile, Research) chips by June as targeted.

"We are on track to do that," Jobs said referring to the plan announced earlier this year.

Apple had publicly expressed frustration with International Business Machines Corp. (IBM.N: Quote, Profile, Research) prior to severing its relationship with the company this year to adopt Intel chips.

Apple is now aiming to have all its computers fitted with Intel chips by the end of 2007.

Jobs said the company had a 4.5 percent share of the PC market in the United States and a 3 percent share globally.


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