Variable Pricing with ITunes....Get Ready!

ITunes will begin varying their prices for digital tracks in April 7th. Many hit singles and classic tracks will cost $1.29. This new pricing plan could be the first real test to see how much consumers are willinng to buy for music. Psychologically, a new song may cause someone want to spend more for that song in order to have it to listen to. However, consumers have gotten so used to spending $0.99 on a song, that it could also be a detterent to charge more money. This pricing strategy will also lower the price of selected songs. The music industry has been pushing for a variable-pricing strategy to try to gain more revenue from digital downloads in the wake of declining CD sales.
But is it the right time for variable pricing? Much of the world is going through a recession and slow-down in growth, so will consumers be willing to spend more for this discretionary expense? Would it make more people want to pirate music, if they can't afford the downloads? $1.29 seems like it's not that much more, but if you are like me and buy 10, 20 songs at a time sometimes, then it can add up. Would it cause more people to move in the opposite direction?
Apple is planning to sell music at 3 prices, 69cents, 99cents, and $1.29. The tracks would be DRM-free and could play on unlimited computers. The prices would be geared to artist popularity. Newly released tracks by new artists would receive the lower prices, while popular acts would get the higher price. Classic tracks would also get the higher price. Most of the songs are expected to stay at 99cents. There could also be the option of bundling a more expensive track with a less expensive track in order to boost sales. These value packages could make customers want to buy more.
I think variable pricing is a smart way to sell music in order to take advantage of artist popularity, but I feel like it should have started in the beginning. Now, I think people have gotten used to how music was priced before and will have to get over the hurdle of the higher price now. People will definitely still buy music, but music purchases may decline from the change in price. The more expensive music purchases are, the more alternate options people begin to seek. Personally, I am a fan of streaming services. Although ad-supported download services haven't quite worked out, ad-supported streaming services have faired pretty well. I like to listen to a lot of music, so economically, it doesn't make sense for me to buy every single download. I would be spending thousands of dollars on music. I think eventually, music will move toward streaming services instead of downloading services because of the ability to listen to more music at a time and not pay for each song individually.