Hottest tracks to cost $1.29 at ITunes starting April 7

True to supply-and-demand economics, the price of music downloads will be geared to the artist's popularity. Releases from new artists would receive the lower pricing, while tracks from popular acts would get slapped with the higher rate. Even classics, such as Bruce Springsteen's "Born in the USA," could retail for the higher price. Most of the 10 million songs in the iTunes catalog are expected to remain at 99 cents.

The willingness to experiment with pricing is a sign of a maturing market, said Russ Crupnick, a senior analyst for NPD Group. U.S. digital music sales topped $1 billion for the first time in 2008, up 27% from the year before, but Crupnick estimates that average spending has leveled off at $41 per consumer.

"If you're not drawing new people and your spending isn't growing, it's a natural part of the product life cycle" to raise prices, Crupnick said.

Crupnick said he doubted a 30-cent price increase would prevent iTunes customers from buying a hot new release from artists like Kelly Clarkson, Flo Rida or Lady Gaga. He noted that offering a discounted second track packaged with a premium priced song from the same artist could boost sales.

But altering the dollar-store allure of the digital download might prove more challenging than the record labels are betting.

"The power of 99 cents will be harder for the labels to overcome than it would have been if they'd had this ability [to change prices] a few billion downloads ago," said Frank Luby, a pricing expert with Simon-Kucher & Partners consulting, who has done work for Warner Music Group. "The longer a habit like that lasts, the harder it is to break."

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dawn.chmielewski @latimes.com