The MP3 Economy : where does your $1 go?

Interesting story, highlighting how little recording artists see...

"The going rate for downloading songs from online music services like Apple's (AAPL) iTunes Music Store, MusicNet, Pressplay, and Rhapsody is about $1 a pop. Yet the economics of recorded music sales haven't changed much since the vinyl era -- despite the fact that digital files cost very little to produce and distribute. So how much of your buck makes its way back to the artists? Not much, though it's clearly a better deal than they get from piracy."

The artist gets about 12%, the label gets 30%, and the website gets 40%. A nice, fair, even split.

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News source: Slashdot

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I think 40 cents a song goes into the running cost of the website. I don't think its like neowin where most of us also have a day job, from that 40cents they'll be paying servers, wages and everything else involved to keep a website with that magnitude up.

I know its playing devils advocat but people seem to assume that what apple is doing costs them nothing and that 40 cents is somehow profit, I doubt it very much.

Agreed, that 40c clearly goes someone to sorting contracts, running the severs etc; but once setup, those costs just plummet- its an online distribution system that cant require that much to day 2 day maintenance; asides a few people running the site and getting the files on there, i cant see there being many costs.

And 40c is just a rediculous figure- the artists should be getting more money for their efforts.