Why Do Digital Services Cost So Much?

A few days ago, someone told me she subscribed to the digital services of a newspaper. It sounds like a good idea to have access to full stories on a tablet.

However, it was just as expensive as the regular paper subscription. She canceled not understanding why it wasn’t cheaper. No presses needed to run to print anything. No early rises for the paper boy. Why the same price for the reader? Sounds like good logic to me.

A few days later, I’ve found myself thinking the exact same thing when I was browsing through the iTunes store in search of a good movie.

Most movies are charged the same as the costs of a DVD at the store. And the DVD’s got extras. You don’t get those in the iTunes store, so why are the prices the same?

Wasn’t the digital era supposed to make things cheaper?

As a web developer, I can definitely argue that apps or software need their fair share of maintenance. They are very subject to change as operating systems change; the very device software runs on.

You always have to keep things up to date, but are those costs high enough to keep the price high of digital entertainment services?

Music and Movies vs Newspaper Content

When it comes to Apple, it’s unclear to me how much influence they actually have of the content and it’s price. Though I know they take their fair share! However, they are relying on other parties to make content available.

That said, a newspaper creates it’s own content for their own website or app. That leads me to conclude there’s room for them to charge less for their digital services compared to their paper versions.

It’s clear that Apple and their content providers want to keep the price up. Interesting enough consumers are willing to pay it too! Apple saw their sales of movies, apps and books increase.

However, we clearly feel different about music. Music sales have dropped and we are not that keen on paying for our streams.

Also read:

Apple Asks the Music Labels for a Price Cut on Streaming Subscriptions (on Re/Code)
Apple iTunes sees big drop in music sales (Business spectator)

Bookmark the permalink.

Comments are closed.