Interesting Zune Move

I'm guessing this falls into "the cost of doing business" bucket, especially when arriving so late to the party, but I was really surprised to read the Microsoft will pay Universal a fee for each Zune sold (see this article).

OK, I get that business deals are often complex and a lot more than meets the eye (for example, a fee for each Zune sold with a lower per-song comission may be advantageous to Microsoft) ... but what I found surprising was this quote:

"We felt that any business that's built on the bedrock of music we should share in," said Doug Morris, chief executive of Universal.

When I read that I think, "it's no wonder people despise the RIAA."  The article does mention the "iPod tax" in some countries that goes to help music companies who have lost sales due to piracy.  Yes, the internet + tolerable compression + an antiquated and inadequate business model has contributed to music piracy, but it has also created a huge market.   The rampant piracy was largely due to people ripping CDs and distributing the content through P2P, which has nothing to do with (for example) the market that the iPod and iTunes has made (unless, of course, there is rampant de-DRMing iTunes, which doesn't seem to be the case).

Anyway, competition is often good for the consumer, and while I hope the Zune does well, I wonder if its success will give Universal more latitude at justifying rate increases.
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