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Topic: FLAC vs MP3 downloads and $$$ (Read 15415 times) previous topic - next topic
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FLAC vs MP3 downloads and $$$

Say it isn't so...!

Just came across a post referring to the band U2 offering all albums formatted as FLAC or MP3 on their official site.  Decided to take a look and was horrified to see that they were charging more for the same album formatted as FLAC as opposed to the MP3 version.  This is terribly wrong in my opinion, as FLAC was developed with Freedom of costs as a fundamental aspect.  I understand as a consumer I, we have a choice whether to purchase or not, but don't really understand why the vendor feels that they should be able to make a larger profit for providing the album using a superior format (in terms of retention of original product) that they utilized without any costs.  Though I'm very pleased to see more on the FLAC bandwagon and hope this further propells the support of the format, I'm hoping this is not an unavoidable upcoming trend.What's everyone's opinion here?

The original post:  http://www.hydrogenaudio.org/forums/index....showtopic=74300

FLAC vs MP3 downloads and $$$

Reply #1 –
I won't comment on legal uses of the flac encoder (because I'm not familiar with the flac license and, in general, the nuances of free software licenses make my head spin) but at the same time I'm aware that many a website has been selling music in flac for a while now.

The two points I will make are:

1. Lossless is a premium product.  There are plenty of people out there that will buy it, and pay a premium for it.
2. Bandwidth costs money: they're simply matching prices to costs.

Unless there is some legal issue I don't understand what there is to get so worked up about.

FLAC vs MP3 downloads and $$$

Reply #2 –
I can see your point about bandwidth,  however I don't agree with your statement that lossless is a premium product.  Lossless is the ORIGINAL product.  Lets face it.  These are not new releases so it's likely that I can pick them up at my local "bargain bin store of your choice" for around $10.  By downloading the product they save the costs associated with packaging, artwork, shipping, and store labor (understanding that there is more than one they involved in that process).  By going that route I can then convert to FLAC for free and have the CD to archive.  Just feel like its a little shady, but I agree that the costs associated with file transfer is a very true reality....

FLAC vs MP3 downloads and $$$

Reply #3 –
In this day and age, lossless is a premium product.  It is premium when stores such as Best Buy are charging $12.99 for a CD while the iTunes Store is selling a 256kbps lossy download for $9.99, iTunes will even throw in a couple of exclusive tracks.  Right now, lossless is viewed as a premium product and will be priced as such.  When downloading something, you have to factor in many different elements.  Bandwidth, storage, software that automates the charging process, and you pay for a convenience of getting the media "instantly."  That is no different than Dish Network charging $4.99 for a 4 month old PPV movie, Sony charging $14.99 for a standard definition movie through the PSN video store, and so on.  You and others may have been using FLAC (and/or various other lossless formats) for years now but the common public hasn't been doing that.  In fact, most people buy an iPod, download iTunes, plug the iPod in, start ripping their CDs using iTunes, and start purchasing music from the iTunes Store.  They don't care so long as things work.  FLAC this, ALAC that, AAC, mp3, WMA, blah, blah, blah.  They could really care less so long as things work.

Hence, to them, FLAC is a premium product that costs more to sell (bandwidth and storage).

FLAC vs MP3 downloads and $$$

Reply #4 –
Most of the time when you buy and album in mp3 it is cheaper than the cd so they charge the cd cost for the flac version i think.

It is still cheaper for the flac than the cd at least a bestbuy where it costs 13.99 for the cd and it costs 11.99 for the flac version on U2.com

FLAC vs MP3 downloads and $$$

Reply #5 –
You can say that FLAC is a premium product, but I'd still say it should stay the same price. Music are already priced rediculously high, so I have a hard time understanding why I should pay so much more just to get the "real" product - Even without any physical medias!

Record companies obviously want to go the download-way instead of selling CD's, which is fine by me, but the product should not be worse (which are a fact with current solutions, and the reason i DON'T use iTunes)!!!
Can't wait for a HD-AAC encoder :P

FLAC vs MP3 downloads and $$$

Reply #6 –
While I think it's perfectly ok (if not appropriate) for a lossless version to cost more, I do not think it's ok that it (or a lossy version) cost the same as a physical CD.

FLAC vs MP3 downloads and $$$

Reply #7 –
FLAC is a premium product compared to mp3. And bandwidth plus connivence are factors in the pricing.

IMO most music isn't priced ridiculously high. I remember the days when Vinyl and CD's where in the $15 to $30 dollar range.

FLAC vs MP3 downloads and $$$

Reply #8 –
Quote
I do not think it's ok that it (or a lossy version) cost the same as a physical CD.

Amen to that, greynol.

FLAC vs MP3 downloads and $$$

Reply #9 –
I do believe in supporting starving artists over distributors, however.  If the extra money that would otherwise go into overhead to distribute physical goes to support the artists and people are willing to pay, then by all means.  I do feel for locally owned record stores as well as those who are employed by chain stores (though I utterly despise the concept of Walmart).  As for the record label executives and the rest of the industry who push music for which they have no passion other than for $$$, not so much.

FLAC vs MP3 downloads and $$$

Reply #10 –
I guess it depends on how you percieve the situation.  I see it as FLAC costing unwarrantedly more.  As MP3 was the primary format for music downloads for most of the "digital music purchasing" period thus far and I could get albums (though I never chose to) digitally for $10, now charging $2-3 more for the product now feels like an INFLATION of the price.  Suppose you could say that they're giving a discounted price for MP3...?

I would say though that the savings for record companies, distributors, vendors in physical material, packaging, shipping, and labor easily pay and make up for the currently highly affordable transfer bandwidth and storage.  Actually, they probably make out much better!!

...and I doubt U2 gets much of that extra $2-3 dollars.

FLAC vs MP3 downloads and $$$

Reply #11 –
the music "industry" has an extremely hard task at keeping itself alive. the reason for this is that THEY AREN'T NEEDED ANYMORE. anyone can distribute his/her music with very low costs, the era of big deals and money is over. and they sue anyone they found just to prove the need for them. copyright infringement my ass... the big money is in gigs, and anyway there's no evidence illegal filesharing actually decreases sales. with these big lawsuits they can say, you see? you need us! but all they do is alienate fans even more. and yes, there is jamendo for the enlightened. if i ever release something, it surely will be under CC.

about the prices... they try to match them to a CD, but that's completely wrong. 90% of the price of a CD goes to the label because of "incidental expenses". and yes, they want to keep their 90% even though the distribution of this media is almost costless compared to traditional CDs. all artists should get rid of these vampires and distribute their music on their own. all the music "industry" does is harm.

FLAC vs MP3 downloads and $$$

Reply #12 –
Quote from: ShawnLuciano on
Suppose you could say that they're giving a discounted price for MP3...?

If you look at any situation in as negatively a way as possible, then you will have negative feelings about that situation. Look at it positively: you're now offered a choice that you did not have before. Buying and downloading an album in FLAC is likely more convenient (and less expensive) than ordering it online and waiting for it to be delivered or driving to your local retailer and buying it from them, so they're offering you a convenient option. It's a "better than nothing" situation.

Expecting MP3 and FLAC to cost the same is unrealistic given that the cost of digital distribution (through conventional means) scales with the amount of data transferred. If the FLACs were distributed via a peer-to-peer system, then you might expect for them to cost as much or perhaps even less than the MP3 version.

If I were a distributor, I would take one of two routes with FLAC:
A) Charge a premium price for lossless downloads, as distributing more data is more costly
B) Charge the same price as MP3, but distribute the file(s) via BitTorrent

Probably B, but failing that, A. It's an entirely reasonable course to take given the nature of digital distribution.

FLAC vs MP3 downloads and $$$

Reply #13 –
I don't know. I still feel that a FLAC download costs oh so much less, including bandwidth than shipping to walmart, paying for packaging and all.

And this should go directly, or almost all to the band.

They can see it as premium, but it ain't so.

And it is much more a convenience to them, than it is to me: 0 logistics / 0 intermediaries / 0 stock.

FLAC vs MP3 downloads and $$$

Reply #14 –
Much economic theory failure here today.
You charge the price which maximizes profit.  This is the maximum the market will bear, flavored by the complicated math of diminishing sales as prices increase.

You do not charge based on production cost.  Let me stress - production cost has only one thing to do with sales price - and that is if production cost > the maximum the market will bear you do not produce.

The beauty of selling FLAC and MP3 is you create a new high market with the FLAC sales, and those unwilling to pay the higher price have an alternative - the mp3.  Basically you have increased profit by maintaining the same cost of production (bandwidth increases and cost of a second encoding are negligible) by adding a premium product.
Creature of habit.

FLAC vs MP3 downloads and $$$

Reply #15 –
I dare to say that anyone claiming that costs are high due to increased requirements for broadband connections are wrong.

Legal downloads started many years ago - When broadband lines were actually expensive! While broadband connections today are dirt cheap compared to that time, theres no argument why the music today are more expensive!

Music industry is the only industry that does not introduce discounts when product costs decrease!
Can't wait for a HD-AAC encoder :P

FLAC vs MP3 downloads and $$$

Reply #16 –
Those parasites apparently will never learn no matter how often their greed backfires in the end. Just like it was in the good old days when the CD first came out, the CD was a lot cheaper to produce and distribute thanks to its digital nature and smaller size, yet they charged the same or even more for it compared to vinyl. And than CD burner and mp3s came, a development that was long overdue punishment for their never ending greed. And we all know the rest of the story. Many years passed and they still haven't a learned a bit, again they found ways to distribute music a lot less expensively, and again they still want to charge the same price for it.

History repeats itself.

FLAC vs MP3 downloads and $$$

Reply #17 –
Quote from: odyssey on
Music industry is the only industry that does not introduce discounts when product costs decrease!

Bogus - for the reasons I said above.

The music industry is not alone in selling a nearly unique product.  Substitution pressures are existent, but weak, and so even if Band B sold tracks @ price N, Band A could likely still move as many units at N+1.

Many labels have been selling their entire catalog ~$10 per CD since the late 80's - and it has had little to no effect on the price of major label product.

Do you believe the cost of Microsoft Windows / Office has any bearing on the retail price?  Marginal cost is almost zero, and with the ever increasing volume of sales research costs per unit have likely decreased every release.  (to name just one example - there are many such markets)

I'm a land surveyor.  Do you think my company charges less every time we invest in a new technology which increases production efficiency?  I can tell you right now we don't.

Did roofers start charging less per roof upon the advent of pneumatic nailers?  Do quick-lube places charge less after they buy a suction oil-exchange system?  Did the railroads charge less per freight-ton upon the implementation of double-stack cars? 

No - all these investments in technology were to increase margins, not to lower prices.  You lower prices due to external pressures, not internal savings.
Creature of habit.

FLAC vs MP3 downloads and $$$

Reply #18 –
It's quite a PR coup for business to have instilled such a "thankful-for-small-mercies"-victim-mentality among "The Consumers - Formally Know As Human Beings".

CD's were a gigantic rip-off for a long, long time. The giant media companies who own the major labels and their subsidiaries would like nothing more than mass amnesia (to decades of exploitation) followed by a view that MP3 was the successor to CD, followed by "FLAC as a premium product", followed by a blindness to the vanishing logistics, packaging costs etc.

The reality is that theirs is an obsolete business model, and any attempt to preserve/replicate that physical model in the digital domain should be treated with the same kind of contempt that these very same companies reserve for their "customer base".

I agree with kwanbis and viktor, and furthermore I think a negative mindset is one which attempts to justify getting shafted. 

C.

EDIT: Grammar
PC = TAK + LossyWAV  ::  Portable = Opus (130)

FLAC vs MP3 downloads and $$$

Reply #19 –
Quote from: ShawnLuciano on
This is terribly wrong in my opinion, as FLAC was developed with Freedom of costs as a fundamental aspect.


This isn't true.  Theres no requirement that all music distributed in FLAC format be free of charge.  The free in FLAC refers to use of the FLAC software (no license fee is required to play or make FLAC files).

FLAC vs MP3 downloads and $$$

Reply #20 –
Quote
1. Lossless is a premium product. There are plenty of people out there that will buy it, and pay a premium for it.
Right!


Quote
Much economic theory failure here today.
You charge the price which maximizes profit. This is the maximum the market will bear, flavored by the complicated math of diminishing sales as prices increase.

You do not charge based on production cost.
Right!  A FLAC has more value than a 68kbps MP3, even if it happens to cost less to produce.  Does it have more value than a 256kbps MP3?  Does a good song have more value than a lousy song?  I'll leave that to the buyer....  If I find a diamond in my yard, it cost me nothing yet it still has value.  Price, cost, and value are all related, but they are not the same things.


Quote
the music "industry" has an extremely hard task at keeping itself alive. the reason for this is that THEY AREN'T NEEDED ANYMORE.
Wrong!  All of the "rich and famous" atists got rich because they've have record deals.  You might be the best band or the best singer in the world, and you might have a really good home studio.  But, without marketing and promotion, only your local fans will know about you.    OK...  If your are U2, and you are already famous you don't need a record company.  Once your contract expires you can set-up your own website for downloads, and then maybe make a direct deal with Wal-Mart and iTunes. 

FLAC vs MP3 downloads and $$$

Reply #21 –
Yeah, and here's one such "artist" ... I mean brand that makes her money from music sales .. er I mean allowing her "brand image" to cross-fertilize with another brand to make stupid young people think it's really hip to spend money on cool vietnamese workmanship so they can herdlike become uniquely cool like Missy.



That's how they make money - by selling retail. Ask George Michael how he did out of Sony?

C.

EDIT: Looks like the marketing people realised that 50% of that market were black females. Go Missy!
PC = TAK + LossyWAV  ::  Portable = Opus (130)

FLAC vs MP3 downloads and $$$

Reply #22 –
What is your latest contribution to the original topic, carpman?  Or is this just bashing of an economy that, last time I checked, you were not forced to participate in?

Shall we discuss the profit margins of Maserati and how little of it trickles down to the assembly-line workers?

I mean - if this is such a problem for you - buy some shares, write the board, and protest:
"I know you have economists working for you, many of them with PhDs, but you're making a bad business decision and here is how you fix it."

What is this personal level of involvement with whether they thrive or fail that makes them worthy of your contempt?

Your argument is based on the fallacy I attempted to expunge earlier.  Without this false thinking there is no reason to expect such courting of your personal preference.

Your opinion, of course, is valid.  I think the pricing leaves something to be desired, and you clearly do, but to to bash repeatedly a company (industry) which has done you no more wrong than failed to fulfill your desires is silly.

McDonalds fails to serve me the high quality vegan healthy food I desire, doesn't mean I go off on them every chance I get.

PS - what is wrong with the Vietnamese?  Or was that a positive adjective?
Creature of habit.
 

FLAC vs MP3 downloads and $$$

Reply #23 –
Quote from: Soap on
No - all these investments in technology were to increase margins, not to lower prices.  You lower prices due to external pressures, not internal savings.

Well my point was really agreeing with yours, but from a different perspective. My point, like yours, is that corporations are extremely efficient instruments when it comes to concentrating the wealth of the many in the hands of the few. The music business is no different. So if they can get away with selling FLACs like they were something special they will - afterall this is the same economic system that brings us Stereophile Magazine, and has resulted in a media system where PR men outnumber journalists. Just as long as no one expects fact over fiction then everything's cool.

Hey, I'm looking forward to the marketing fever over the NEW ORIGINAL RECORDINGS releases. When the REMASTERED market has become saturated. Marketing will make LOUD bad and sell us these "rediscovered", superior, quieter recordings with incredible dynamic range. 

EDIT:
Quote from: Soap on
PS - what is wrong with the Vietnamese?

I think some of them find it hard to not participate in an economy they "were not forced to participate in".

C.
PC = TAK + LossyWAV  ::  Portable = Opus (130)

FLAC vs MP3 downloads and $$$

Reply #24 –
Quote from: carpman on
Hey, I'm looking forward to the marketing fever over the NEW ORIGINAL RECORDINGS releases. When the REMASTERED market has become saturated. Marketing will make LOUD bad and sell us these "rediscovered", superior, quieter recordings with incredible dynamic range. 


I would hide if I were you.  People have turned up missing for speaking aloud this secret behind the "loudness wars".


Quote from: carpman on
Quote from: Soap on
PS - what is wrong with the Vietnamese?

I think some of them find it hard to not participate in an economy they "were not forced to participate in".


You're seriously drawing a comparison between poverty driven employment choices and the western world's major-label music market?

I wasn't trying to single you out - nor bash you personally - but I'm tired of this endless bashing of the major label music industry as if they aren't doing what they are compelled to do.  Their behavior is as inevitable as that of the common termite.  I don't ridicule the termites for doing what they do - I acknowledge my role in placing wood mulch too close to the siding and inviting them into my home.
Creature of habit.