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How do companies such as I-pod work in respect to royalties and distribution?
As we all know the times have changed and now musicians and the industry are making their money on MP3 downloads and through such services as i-pod. I was wondering how the royalty process works? Also as in the old days record stores would buy by bulk of the record and sell it but now its all digital. Now how does this work out does a company such as I-pod buy the rights and only purchase the album once? Or do they have to buy the song or album based upon how many orders are placed?
Apple uses percentages to pay the royalties for the songs. Of the $1 it costs for a song on iTunes, the majority of it will go to the artist and the record company, while only a small amount, lets say 10 cents, stays with iTunes. Seems like a small amount of money but with well over 1 billion songs sold, Apple has already brought in hundreds of millions of dollars this way.
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