The music, film and video game industries stand to make more money overall if they lower their prices, according to research based on customer surveys.
The report by Ipsos MORI says there's a wide gap between the cost of entertainment media and what people are willing to pay. Slashing prices could have a great impact on the incidence of media piracy, a story in The Guardian claims.
Ian Bramley, director of Ipsos' entertainment unit, called the research "a bit of a wake-up call." More than 1,000 people over the age of 16 were surveyed.
Here's an example from the research: At the current price in England of 79p per track, 10 percent of survey respondents were interested in purchasing music. When the price is hypothetically dropped to 45p per track, interest rose to 32 percent. Doing the math for 1,000 people, the music industry could make £144 at the lower price, compared to £79 at the higher price.
The study certainly has its holes. Interest in a general sense doesn't always translate to sales, and a survey can't replicate the excitement someone feels for a particular musician, movie or video game. There's also empirical evidence that raising prices works: When iTunes raised its prices for select tracks, overall revenue increased even as sales dropped.
Perhaps that's why Ipsos avoids prescribing across-the-board price cuts. Instead, the research group says creative industries -- games film in particular -- should reprice classic releases to make them more attractive. The games industry already does this, but it's a double edged sword, because consumers get wise and put off purchasing new releases to get the sale price.
It'll probably take some tinkering for creative industries to attract former pirates while still charging as much as they can. But in the end, you just can't please everyone.
