Making music a 'commercial proposition'

I was listening to an interview on the Guardian Technology podcast between Charles Arthur of the Guardian and Matt Phillips of the BPI, about the new file sharing legislation, and (inevitably) it became a conversation about the music industry’s pricing of downloads…

CA: But it’s not [about music being] freely available… if all the albums on itunes cost three pounds rather than eight pounds, [consumers] would be much happier about buying them, because the incremental cost is so much less?

MP: If every album on iTunes was available for 50p that would be very attractive, but that doesn’t necessarily make for a commercial model that can encourage future investment in music and pay all the people involved in the creation and investment in that product, so while I can understand that consumers would want everything for free, that clearly isn’t a commercial proposition.

Surely if ‘all the people involved in’ making music can’t be funded from £8 per album on iTunes, then the answer isn’t to keep charging £8 to fund them all… surely it’s to get less people involved, or pay them less, and charge a price that consumers feel happy to pay?

A successful ‘commercial proposition’  works two ways; it’s not just what the producer is willing to sell at, but what people are willing to buy at too…