Universal Music Group parent Vivendi sharply criticized Apple on Monday, part of a continued air of acrimony between the companies.
In comments reported by Reuters in France, Vivendi chief executive Jean-Bernard Levy pointed to a lopsided iTunes contract, and suggested revamped terms. “The split between Apple and producers is indecent,” Levy said. “Our contracts give too good a share to Apple.” Apple gives roughly 70-cents to majors per 99-cent download, a figure that also includes publishing royalties.
That sounds generous, especially considering various overhead and credit card fees. In fact, Apple – and other download stores – generate only modest profits from a-la-carte downloads. But Apple still controls an huge percentage of digital music sales, and exerts a stronghold over pricing and configurations. “We should have a differentiated price system,” Levy said.
The tough talk is being backed by some action. Earlier, Universal Music switched into a more flexible, month-by-month contract with Apple and its iTunes Store, a move that dangles the threat of a content pullout. Universal also sprinkled DRM-free portions of its catalog to iTunes rivals, another spiteful move.
Elsewhere, the chief executive also pointed to diversification efforts at Universal Music, a broader trend among majors. “People indulge in piracy but spend a lot of money on many other things that are linked to an artist,” Levy noted.