Thoughts on pricing and the Sony-United music download partnership

Tyler Cowen wonders why iTunes charges the same amount — 99 cents — for all songs.

While there may ultimately be a good reason for it, I hope that Sony doesn’t fall into that trap with their new partnership with United that is said to allow redemption of Mileage Plus miles for music. The price in miles is as yet unknown. I hope they get creative and experiment with their anticipated spring launch.

First, they could offer some sort of ‘introductory pricing’ to stimulate interest. Each song could be 100 miles (or 50 miles?) at the outset, perhaps for a week or a month or two. This should build a user base not just of mileage plus members but of mileage plus members that are both interested in music and technically savvy enough to be interested in the service. Then that smaller group could be marketed to and even potentially charged higher prices.

Second, it isn’t clear that all songs should or would have the same price. CD pricing generally (and pricing for many differnet forms of entertainment) has long been a puzzle because it seems so disconnected from quality and interest. Presumably quick access to the latest songs might bring a premium, or on the other hand if the database offers an extensive or near universal library of music perhaps hard to find tunes could be priced higher. Regardless there would seem lots of opportunity for experimentation with price and this service shouldn’t feel constrained to a single mileage or dollar price.

Third, perhaps music could be bundled with tickets in some way, such as receive X download credits for buying a United ticket on the United website. It could be in addition to or an option instead of bonus miles for booking online, could provide a way to encourage more people to book at and lower UA’s distribution costs. In other words, think of more ways to leverage the relationship.

If Sony experiments and innovates, this could be a huge advance in e-commerce. If they just offer miles as a payment option (and even set the mileage price high at, say, 1000 miles per song) then this could easily go down as another uninspiring or even stillborn internet adventure.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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