Most prices, for most things we buy, on-line or not, informational or hard goods, are priced administratively. This reflects organizational pressures, to take price “out of the game” in order to concentrate managerial attention in more productive directions, and to reduce conflict among various actors in the production and distribution chain. Price becomes an element of organizational strategy.

You could ask the questions you ask about any number of goods. You could ask this about the price of movie theatre tickets. You could ask about toothpaste or canned soup or McDonald’s hamburgers or chinos you buy at the Gap.

The price of songs at iTunes is dominated, not by the preferences of consumers, but by the difficulty of arriving at some agreement with the major record labels and the music licensing bodies, which does not destabilize their relationships with bam retailers and with talent. You see pricing simplification because it facilitates agreement and inhibits competition (aka “cheating”) in what is, effectively, an extended cartel.

This is a good article about the failure of micropayments due to the anxiety and hassle they cause.