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Desperate: Universal Music Wants To Lower CD Prices
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By: Spacelab Research Staff
March 24, 2010

In a sign of the times, major label Universal Music Group is going to drop the prices of its CDs from $6 - $10 in a program they're calling Velocity Pricing.

It's intended to compete with online stores like iTunes and Amazon, where the prices are significantly less than traditional CD prices. The idea is to sell more and make up the difference in volume.

CD sales are down 15% from a year ago, and about 50% from a decade ago, which makes sense if you think that CDs still sell for the same prices they did in the 1990's even though the cost of creating them has dropped dramatically.

UMG's head of distribution Jim Urie has been working with Trans World Entertainment on the new strategy and has seen CD sales double at stores running a test pilot program of the new prices.


Tags: Universal Music Group

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