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I uninstalled iTunes today. I was a little hesitant at first but after reading this I am glad I did. The record companies have just shot themselves in the foot. I was a happy music buyer but with this news I am going to stop using buying albums from major labels.
Let me set this straight, I don't mind paying for content. However, when it is blatently obvious that the music industry has reduced costs and has not only refused to pass that on to me, but actually increases my cost, I do become a bit miffed. Now you typical record exec will say that costs have not increased but he is neglecting 2 major points. First, I don't get the cool liner notes and art from iTunes. Second, the quality is poor. Seriously. When I listen with my Grado SR 80 headphones I can tell the difference between a song from the iTunes store and ones that I have encoded at a high bitrate.
I suppose they do indeed have the right to set whatever price they want, but they will lose customers when they do that. I don't want to hear crap about them losing sales to P2P anymore. They just lost this customer to their ridiculous price point.
On the flipside, it appears ESPN "gets it." The CEO, George Bodenheimer, has stated that ESPN will deliver their content to "any pipe, any device". Maybe I will just substitue my music budget for sports content from ESPN.