Microsoft and Universal Strike a Deal, Who is Next?

Microsoft and Universal have signed an agreement that says Universal gets over $1 per Zune sold in exchange for licensing its recordings to Microsoft’s new digital music service. This is huge. Apple has no deals with recording companies like this, Apple only pays them for songs sold through iTunes. This will definitely affect any future deals they have with these companies, companies like Universal had no idea that billions would be made from the iPod when they signed their deals with Apple, so they will want a cut of anything going forward, and I can’t imagine Apple not having to pony some more money up, if they loose tracks in iTunes, they may loose customers to Microsoft and their Zune player.

Universal Music, a unit of Vivendi, will receive a royalty on the Zune player in exchange for licensing its recordings for Microsoft?s new digital music service, the companies said.

Universal, which releases recordings from acts like U2 and Jay-Z, said it would pay half of what it receives on the device to its artists. The company is expected to receive more than $1 for each $250 device, according to executives who were briefed on the pact. Source: NY Times

“It’s a major change for the industry,” said David Geffen. “Each of these devices is used to store unpaid-for material. This way, on top of the material people do pay for, the record companies are getting paid on the devices storing the copied music.”

Sounds like he is saying we are all pirates and they deserve a cut. I say, lots of us pay for the cd’s and expect to be able to do with them what we want, they are our property after all. If the music companies didn’t point as many fingers as they did and sue as many people as they did, maybe everyone would feel a little different about them. I don’t remember recording songs from radio stations being frowned upon, but it is a lot easier nowadays for one song or album to make its way around the world.