After recent major-label qualms with iTunes' uniform pricing format Nettwerk Music, PassAlong Networks and Digonex Technologies have launched a pilot variably-priced MP3 sales format. The new program uses Digonex's pricing platform to adjust the value of Canadian label Nettwerk's MP3 catalog on PassAlong's StoreBlocks store. Based on a sophisticated equation, demand for music is calculated via Internet economics and consumer behavior. PassAlong uses the calculated demand to vary album prices from $3.30 to $9.99. Singles fall into a three-tier range of $.33, $.66 and the standard $.99. "We've done lots of studies and analysis," says Jeff Eglen, Digonex's vice president of strategy. "There are artists that have a hardcore following that fans would be willing to pay more for, despite low actual sales numbers." At the same time, Eglen says back catalog offerings (tracks older than two years) often would sell if they weren't stuck in the $.99 bracket. The idea, ultimately, was to find pricing for each song or album that would optimize sales—and profit of course. The prices will be re-evaluated on a weekly basis determining the value of Nettwerk artists like Barenaked Ladies and Sarah McLachlan. The program is only a pilot, and will be reevaluated and adjusted by the end of 2007. www.storeblocks.com www.digonex.com www.passalong.com
