iTMS: Here's the deal [for labels]


The president of CD Baby, Derek Sivers, has announced himself enamored of Apple's iTunes Music Store. In his personal record of Steve Job's presentation to 150 independent music labels on Thursday, Silvers details what Apple offers and expects from any company that wants to list its music on iTMS.

Statistic of success:
o There are 6-7 million copies of iTunes in use;
o 3.5 million songs sold so far with 500,000 tracks selling per week;
o More than 75 percent of listed songs have sold at least once; o 45 percent of all songs have been bought as an album;
o 90 percent of all sales are "1-click" downloads;
o 10 previews for every purchase; and
o 10 million customers have opted-in to receive a "New Music" email from Apple every Tuesday.

Pricing policy:
o Songs must sell for $0.99 each;
o Full albums are recommended to be $9.99 or lower;
o Album price must be less than or equal to the sum of their tracks;
o Songs over seven minutes long won't be offered as a separate download;
o Albums cannot be sold only as albums, individual tracks must be offered for sale; and
o There is no cost to put your music on iTunes nor will Apple make any upfront payments to listers.

Benefits Apple provides:
o Apple is reporting all iTunes sales to SoundScan! (emphasis from the original);
o Featured music is selected by Apple's in-house, independent editors (ie no payola);
o Indies get the same deal as the major labels, it's take or leave it, non-negotiable ("We're not going to deal with 200 lawyers" ? Steve Jobs);
o Rights are a three-year term (iTunes only), non-exclusive;
o Apple tabulates and pays royalties monthly;
o Google offers exclusive discounts for sponsored links into iTunes;
o Macs in 57 Apple retail stores are pre-loaded with playlists called "Discover Indie Music;" and
o Apple provides marketing, PR, previews, infrastructure and credit card transactions.

There's a ton more information and it's an interesting read, especially Silver's occasional expressions of happy surprise at the generosity of Apple's terms and service.

For those unfamiliar with CD Baby, it is the second largest seller of CDs on the Internet second only to Amazon, which is reportedly in talks with Apple for space on iTMS.