Music Download Pricing Lawsuits Pending? 176
larry bagina writes "New York Attorney General Eliot Spitzer has subpoenaed Warner Music Group, apparently looking into allegations of price fixing with Sony/BMG, EMI, and Vivendi, and apparently more subpoenas are in the pipeline. 'As part of an industrywide investigation concerning pricing of digital music downloads, we received a subpoena from Atty. Gen. Spitzer's office as disclosed in our public filings. We are cooperating fully with the inquiry.'"
Well, there is price fixing . . . (Score:4, Interesting)
Re:Spitzer is looking for publicity (Score:2, Interesting)
FTC Site (Score:2, Interesting)
According to the FTC complaint detailing the charges, in 1997, Warner and PolyGram (predecessor to Vivendi Universal), two of the largest music distribution companies in the world, formed a joint venture to distribute compact discs, cassettes, videocassettes, and videodiscs to be derived from the next public performance of The Three Tenors. Warner would distribute the 1998 releases in the United States, and PolyGram would distribute the 1998 releases outside of the United States. As the concert date approached, both companies became concerned that the new products would be neither as original nor as commercially appealing as products already available to consumers. In an effort to shield the new products from competition, Warner and PolyGram agreed not to discount and not to advertise certain of their catalog products for a limited period of time, the complaint says. The FTC alleges that the agreement violated federal law
http://www.ftc.gov/opa/2001/07/tenors.htm [ftc.gov]
Re:why warner (Score:5, Interesting)
So they decided not to advertise about previous releases?Well,dont many companies do this?Only here,seems both of them decided together.& what competition are they talking about,when they own the rights.?
1. Had there been actual competition, instead of a oligopoly of a few major labels, a decision to market older products less wouldn't have given the Three Tenors any competitive advantage, seeing as how 100 other record labels wouldn't hold back on the promotion.
2. The record companies screwed all other artists that weren't the Three Tenors.
3. Copyright is a (prohibition) right granted under the theory that allowing creators to benefit of their works stimulated them to make more works. If artists didn't get properly compensated, the reasoning goes, we would all be stuck with the same old tripe. In this case, the record companies clearly intended to delude the consumer into thinking, yes, the same old Three Tenor tripe is all that's out there to buy.
4. Pooling two companies' promotion clout allowed them to come on top of the Three Tenor deal. Had they not colluded, they would have taken a loss, to the benefit of their competitors, and the market (the invisible hand should smack down on crappy business, should it not). Competitors that (hypothetically) would play fair wouldn't be able to recoup bad investments in the same way, they'd be SOL - cf. Standard Oil's pricedumping.
So, they screwed the artists, the consumers, competitors, and the Constitution. Not a bad run.
The real price should be 0 (Score:2, Interesting)
essay: Straight Talk About Copyrights [slashdot.org]
It's all fun and games... (Score:3, Interesting)
I wonder why, considering we have more than one state, that it's always New York taking the lead to try and give consumers an even break? He went after the mutual fund timing trades, record company payolla, and now more record company misbehavior. California also went after Edward Jones. California and New York the only states sticking up for consumers instead of standing by and watching consumers get the sticking.
Re:Well, there is price fixing . . . (Score:4, Interesting)
If they get together, say so, agree on a price structure and then find ways to exclude competitors, they have committed a crime. This is what price fixing and anti-competitive practices are all about. Everyone pays so a select few can profit. Artists and others who would make a living in the industry pay more than anyone else.
It's obvious that such a crime has been and continues to be committed. The cost of an electronic copy of costs more than the same with delivered by physical media. In a free market music can be had for a song. Those that would compete are locked out of traditional broadcast and physical distribution. They are also harassed at every point possible by lawsuits and bogus laws which make operations difficult and expensive. The world's three big music publishers seek to impose all the restrictions of physical media and 100 year old broadcast technology law onto the internet because they won't exist without them. The ultimate crime are laws seeking to "close the analog hole". It's nice to see some of the smaller crimes looked into, but a review of "price fixing" misses the big picture.
Spitzer might be working for them this time.
That depends on how deep he goes.
Re:Wow... wow... wow.. (Score:3, Interesting)
The problem is, lawsuits are a financially better alternative than following the rules for everyone but the consumer.
Until penalties for breaking the rules are made worse than the cost of a lawsuit, companies will break the rules - they look at fines as the price of getting to break the law. Engage in any unethical and illegal behavior you want - make a billion dollars, get fined at most a few million.
And then we have class action lawsuits. Ideally, those should be undertaken when there is real harm done to individuals, but now we have scumbags who see them as the royal road to riches and encourage people to sue because their coffee was too cold, or because someone said "Happy Holidays" instead of "Merry Christmas" or a clerk at a Wal-Mart looked at them funny.
Penalties need to be made 100x worse to corporations. Executives responsible for illegal behavior need to go to prison as a rule, not as a rare example. Class action suits should be handled by the AG's office, not by opportunistic private attorneys who recruit people to join their bullshit class action suits.
Business is able to rape and pillage with impunity - I say put the fear of god into the executives. CEO wants to make tens and hundreds of millions of dollars? Fine - as long as they do so legally - and can't use that money to shield themselves when they overreach.
Now, I like the idea of a free market, but there do need to be some limits or else we wind up with corporate tyranny. Ideally, government and business should balance each other out and let the rest of us get on with our lives without having to fear either one.
Re:I've said it before, and I'll say it again. (Score:2, Interesting)
Personally, I can't get enough new music. Most of it is independent (which is great), but many of them end up signing with larger labels that I must purchase from. The music industry is not going to change their ways with a few abstaining "informed citizens" (what a novel idea). The problem is, the music industry needs to shave off the top few layers of the money pyramid. Then, we may have
I don't believe the problem lies within the music industry itself. This is a needed social change. Big Business has become a privileged interest group, something that the founders of our (U.S.) country specifically legislated AGAINST. This is not collusion in a few oligopolies; this is collusion on a fundamental and governmental level.
How to solve the problem? Use the remnants of our Constitution and attempt for change.
Re:Let them sort it out (Score:3, Interesting)
Hope you understand why governement involvement is needed.
I am not one of the people to whom you refer, but your statement is kind of stupid, and so I object merely on anti-stupid grounds. These corporations have their power because government gave it to them: both copyright and corporate existence itself are legal fabrications imposed on the free market by the government. If we take away both of these things, the government would have little reason to step in and "rescue" the public from price fixing, because the problem wouldn't exist in the first place.
Re:Man I'll miss Spitzer when he becomes gov(NY).. (Score:3, Interesting)
The music companies claim they are trying to help the consumers. Forced to pick between them and itunes (who released an honestly useful app with reasonable DRM) I'd pick apple in a heartbeat.