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The multi-billion pound music and gaming industry are set on a collision course over pricing. Viacom chief Philippe Duaman wants to "reduce the cost structure" surrounding music rights for hit games - at a time when record companies want to increase that cost structure. The rapid growth of 'Rock Star' and 'Guitar Hero', that helped record companies take a slice of the action from the booming games market has peaked, and many feel it has failed to transform the music business in quite the way some predicted. So, it's perhaps no surprise that the gaming industry is now looking to reduce the costs of making future editions of such games, and of running the download stores that provide gamers with new tracks to pretend to play. This will be interesting, though, because that mainly involves negotiating lower rates with the record companies for using their music, and some label execs - Warner Music chief Edgar Bronfman Jr in particular - have previously said they feel the gaming companies have been underpaying for music to date. 'Deal with us or no one' Duaman, who ultimately oversees 'Rock Band' through his company's MTV Games and Harmonix divisions, last week told analysts that he hopes to pay less to the music industry for their involvement in the pretend-to-play franchise moving forward. Or, rather, that he would be selective in the music titles chosen for 'Rock Band' based on their cost – “the music industry will assist with this category to make sure that it can continue on a profitable basis in the future". Moreover, you could infer that Duaman's remarks are basically saying that if Bronfman Jr isn't willing to do deals with the gaming firms at current or reduced rates - as he has indicated in the past - then Viacom don't care, they will only do music deals when the terms are favourable. That sentiment may force the labels to accept cheaper deals. Especially as it increasingly seems Viacom's rivals will be adopting a similar policy in future. Certainly 'Guitar Hero' publisher Activision expects to downsize its music-games release output this year. Additional reporting by CMU Network
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