
FTC Settles With Big CD Makers-Cheaper CDs Coming? 152
kid_wonder writes: "The FTC today announced that they had '... reached separate settlement agreements with Universal Music and Video Distribution, Sony Corp. of America, Time-Warner Inc., EMI Music Distribution and Bertelsmann Music Group (BMG), the five largest distributors of recorded music who sell approximately 85% of all compact discs (CDs) purchased in the United States to end their allegedly illegal advertising policies that affected prices for CDs.'
"
Lower Prices? (Score:2)
Oh my god! (Score:1)
Oh my god It'S flatlined!
Quick! Call the Code Blue!
Re:This explains alot (Score:1)
If you ask me, its no good buying a CD and then complaining about the price. Obviously you could afford it.
Re:This explains alot (Score:1)
Re:Japanese CD prices (Score:1)
Re:A tough one for libertarians (Score:1)
The libertarian recourse in this sort of situation is typically that they should "start their own distribution company". Small, starving start up bands don't have these kinds of resources, if they did they would have done it all ready. This is one area where Libertarianism is terribly naive.
Because of the monopoly status of the RIAA musicians have only two choices. Either remain insignificant forever, or sell out to the recording industry.
Obasan
If a tree falls in the forest, and kills a mime, does anyone care?
Re:A tough one for libertarians (Score:2)
There is competition, and it's on two fronts.
First, the consumer can choose not to deal with the retailers. Just as an example, specialized places like Century Media [centurymedia.com] sell for $11 per CD for things on their label, and $12 on other labels. And of course, CDs from mp3.com [mp3.com] is even cheaper and carries a much wider variety of genres. These also have a secondary advantage in that they have a lot more selection that Best Buy. I recall browsing through Best Buy several times, and for all the CDs they had, they just didn't .. well .. have anything.
The second front of competition is one that is still just emerging, thanks to technology and The Internet. The creators of music have the option of not dealing with the big media companies. Independent production is possible now without requiring too much capital, and The Internet is capable of competely obliterating the distribution problem. Musicians have a choice of whether to deal through the big labels and retailers, or going indy and selling other ways. Up to now, that choice has been quite lopsided. But that's changing fast, and it may soon be lopsided in the other direction.
Keep in mind that there's two sides to the MP3 explosion. It's not just about disrespecting IP (as mp3.com showed prior to their dumb idea of offering the my.mp3.com service). I don't see any reason why MP3s (or something like them, such as Ogg Vorbis [xiph.org] files) cannot be sold, and they've already proven themselves for marketing and promotion outside of the megacorps' channels (MTV, radio, etc).
(BTW, although I consider myself pretty libertarian, I must admit that I'm sometimes stumped as to how the market can fix certain types of problems. I just think that the current music situation isn't one of those cases.)
---
"doesn't read CDRs" (Score:1)
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Openstep/NeXTSTEP/Solaris/FreeBSD/Linux/ultrix/OS
Re:I wonder if you have the same problem with DVD' (Score:2)
For a lot of major video releases, the initial prices are set high so that movie rentals are boosted. The price of these releases tends to drop a month or two after the initial release.
It has nothing to do with DVDs, it has been common practice for quite some time with video cassettes as well.
Stop ripping us off! (Score:1)
Re:This explains alot (Score:2)
Link to pricelist [warehouse-studio.com]
numb
CDs have been overpriced for years (Score:3)
When stamping CDs in bulk, the cost is next to nothing. I don't have any references off-hand, but I am positive that it is actually less expensive for the record companies to produce a CD than it is to produce a cassette.
So if the record companies can make a profit when cassettes are sold for $10, doesn't that mean that the extra $5 for a CD is pure profit? Doesn't that mean that the music companies have basically been sticking consumers $5 a pop for the millions of CDs that have been sold?
It's no wonder that the music industry so fears online music. One way or another, it is signalling the end of their consumer fleecing.
ah the irony (Score:2)
excellent news! (Score:1)
woohoo!
Re:Before you americans complain about cd prices.. (Score:2)
>who (sometimes) buy a cd for around 17 pounds
>(probably about 30 dollars).
Silly brit, the most mundane UK import costs
$30-50 in the USA.
Quality of CDs (Score:2)
Not so clear-cut (Score:5)
But this isn't necessarily the case of record companies gouging consumers, so much as record companies "protecting" stores.
Every store buys their CDs for pretty much the same wholesale price (maybe $11), and the MSRP is $15-20. But Best Buy was a new kid on the block and was will ing to lose a dollar on every CD to get you in the store, hoping you'd pick up a CD player or a video game while you're there.
Now this sounds like a good deal until you realize that a Record Store can't sell their music for less than what they paid, and essentially have no chance of competing with a megastore that can treat music as a loss leader. So record stores have been closing, and our musical choices at Best Buy are (needless to say) more along the lines of Britney Spears than Indy Imports.
Granted, this is pretty much the same issue as brick-and-mortar places will face in regards to online retailers offering significant discounts, even willing to lose money to build business the same way best Buy did the first few years.
But economics doesn't go away just because CDs are cheaper for a few years. What happens when everyone but Best Buy (or CDNow or whoever) has gotten out of the CD business? When all the local record stores have closed, and Best Buy decides to start charging $15/CD again? You're screwed, because there's no more record stores. Best Buy can survive a war of attrition a lot longer, and once they win they have no requirement to keep the proces low.
Not that this will necessarily happen (in fact i consider it unlikely simply because online retailers will always be available for CDs at the lowest retail cost).
But it isn't an imaginary fear that the record stores have -- look at the stores that have closed in the wake of the Wal-Martization of america...
Re:I wonder if you have the same problem with DVD' (Score:1)
Hmmm (Score:1)
Re:Would it be ironic (Score:1)
Re:yea (Score:1)
That amounts to only $2 per american (if we all bought 1 CD) - which brings the prices back down to oh, $18/CD. Which is still outrageous. Like someone else said - $10 is highway robbery. More like $5 is fair.
I just remembered this old Metallica song. . .
Before you americans complain about cd prices.. (Score:5)
Cant think why mp3 sites are so popular...
Check out the footnote (Score:4)
It took me a few seconds to realize that Swindle and Leary are the last names of two commissioners on the FTC! FTC doesn't like swindlers, and they're leary (leery) of any minimum advertised price policies.
Re:Now what's the excuse (Score:1)
And no, this isn't about disrespecting the artists. Even though i don't think it's a right (as many music industry lawyers would have youbelieve), I think that musicians should be able to be compensated for their work. This is one reason why i buy as many independantly released lps and cds as i can afford. This is not only because indies generally put out (in my opinion) better music, but because they actually treat thier artists well. If you want proof of how majors shit on thier artists, read this. [indiecentre.com]
So please, before you post another reactionary rant, think about the fact that there are actually people out there using napster who are not whiny, spoiled little kids and who have put more thought into the implications of thier use of mp3s than the fact that if they download rather than buying, they'll have more of mommy and daddy's money left over to buy pot.
Would it be ironic (Score:3)
If the resulting lower prices reduced pirating, increased cd sales and made these companies more money.
Re:CDs have been overpriced for years (Score:1)
I'm sorry...I'm ignoring all of those 'special features' that we get with the DVD version, like audio commentary by the producer's pet dog. Forgot about all that value added crap.
Do unto others (Score:2)
-D
Re:This explains a lot (Score:1)
As for soda; it's the restaurants (and movie theaters) that have the gigantic profit margin there.
Free Market? Wake up! (Score:2)
Of course there is no free market for entertainment content.
I'm amazed at all these naive posts on /. saying they don't "know" what's CD printing cost. Just do a search on "printing CDs" [cdworks.com] and you would find that in a qty of 1000 you can have them printed for $0.90 a piece, with a box and a paper insert, DVDs - same for $2.00.
So, what is reasonable sale price for them - I would say with over 400% profit - $5 is very reasonable. So, all you RIAA agents vining about "Napster Kids" asking for $5 pricing - shut up and enjoy this illegal (in terms of antitrust) situation while it lasts. And if you sell DVDs at $5 - then you'll have to "starve" on a 150% profit...
The fact that CDs and DVDs are not selling at $5 proves that there is NO such thing as a free market for these goods and services. Learn to live with that all you libertarian buddies :-) And $2 profit per CD is more then enough to feed the artist, as well as run the studio and other supporting services.
CD prices are so high because of the lawyers... (Score:1)
kwsNI
Probably not cheaper CD's (Score:3)
Re:CDs have been overpriced for years (Score:1)
No, it means consumers are apparently willing to pay that much for a CD, nothing more and nothing less.
Well, actually, it may mean that the record industry had been underchaging of cassettes and records for quite a while, since the increase in price associated with CDs hasn't really killed demand that much.
Re:Probably not cheaper CD's (Score:1)
Order it from Amazon, they carry damn near everything.
Exactly (Score:1)
But they don't, and I think this settlement gives us a glimpse as to why.
Re:CD Production Amounts to an Oligopoly (Score:1)
The big distribution companies would hurt, but they have taken in a fair bit of cash already, and I like the idea of being able to pay half the price for a CD and give the artist three times what the would get had I bought music at a store.
-DB
Cheap CDs==Bread and Circuses (Score:1)
Friends, we must RESIST this manipulative plot! Don't be bought with the promise of cheap music! Rise up and DEMAND your right to be overcharged for CDs!
Re:CD Production Amounts to an Oligopoly (Score:1)
yea (Score:2)
The FTC estimates that U.S. consumers may have paid as much as $480 million more than they should have for CDs and other music because of these policies over the last three years.
No wonder the RIAA hates
That is a huge rip off man..
Re:CD Production Amounts to an Oligopoly (Score:1)
You may be forgetting about some unsanctioned mind altering substances.
Ah the good old days of Columbia House Mail Order (Score:1)
Re:CD prices are so high because of the lawyers... (Score:2)
Japanese CD prices (Score:1)
UK folks have nothing on Japanese CD prices, where one disk can easily set you back 4300 yen (40 bucks or so). Ever tried importing one of these babies? Get ready to shell out $50 per disk.
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meta4
dw2-dont-spam-me-@opencontent.org
http://davidwiley.com/
Re:Do unto others (Score:1)
But you don't understand how true this is. It is in fact ok for CD makers to screw cusumers, as much as the consumers (inluding me) may not like it. This is a capitalist society, in which the companies are supossed to look out for their own good, not for ours. They are here to make a buck, not to make us happy.
If you dislike the way a company works, your job is to stop purchasing they're products, which a lot of us have stopped doing.
However: it is not ok in any way to steal intellectual property by trading music over the internet. This analogy is perhaps a strech, but I will make it anyway: Trading MP3s becasue you dislike the high prices of CDs is similar to robbing your local grocery store becasue the price of bread is to high.
Of course, people are bound to argue that you don't actually take anyone's property by trading MP3s, you simple reproduce it. Consider counterfieting money. You don't have to rob anyone to print a bunch of twenty dollar bills for yourself, but it is sitll legally and morally wrong. It may seem silly that you shouldn't copy music that is so poorly secured (the wax lock analogy) but it is still wrong, and does in fact cost the recording companies money to produce CDs. Trading music that you do not own the rights to is damaging, and crimanially so
If you're upset a about the way CD companies treat cunstomers, boscott them, but do not use their high prices as a justification for a criminal act.
Re:This explains alot (Score:1)
I bought my player in 1983. At that time disks were typically C$19 in the big cities and C$21 in the small town where I lived. The price dropped to about C$17 / C$19 a couple of years later, then swiftly rose to the mid twenties (say C$26). I guess this is where you came in.
The price very gradually dropped from that peak towards 20. I stopped buying much music about 5 years ago. Someone from my city has already said that typical prices are now mid teens.
I also found it odd that some small bands sell there CDs at 10$ a pop for a small cd run, vs 18 dollars for a mass produced cd.
Blank CDR's are somewhere under $2. A recorder for them is US$100. A band member's time is worth $7/hr and he doesn't even have to sit there watching the progress bar chug for the hour. I would be very surprised if the stamped disk is more than 50 cents in 1000 lot runs (not counting printing, case, or case printing.) I'd be surprised if the media were more than 20 cents in the very large runs. Your $18 is paying for the artist's lifestyle, the massive ad campaign, and for DMCA lawyers to harass websites.
UK CD prices (has figures) (Score:1)
But in smaller towns and cities the independants have taken a pounding. When I was a teenager in Newcastle there were over 10 independant stores in the city, there seemed to be about 3 or 4 left the last time I went back, and they weren't all that much cheaper than the majors (HMV, Virgin). They've all been squeezed out of existence.
Going into an HMV in the local mall, I found most of the albumns were priced at around £18. This is $28.80. I nearly passed out!
Sales Tax (VAT) in England is 17.5% (not nearly the highest in Europe) so that would make up about £3.15 of the £18 total. Yup that $5.04 tax, so the CD costs $23.80 before Tax. Sales Tax in NYC is 8.25% and CDs cost $13..14, so that's $1.55 in tax.
So a good comparison is:
$12.45 in the US versus $23.80 in the UK.
Thats 91% more in the UK.
When asked why this is, the major distributors have frequently explained that its because "fuel prices are higher". Yes, they really do have that little respect for us.
Lord Pixel - The cat who walks through walls
Re:This explains a lot (Score:1)
I have a friend that owns a cafe that serves Coca-Cola fountain products. He says that his cost for a 16oz soda, including the paper cup that says Coke, is less than 16.
I also hate restaurants (usually smaller local places not huge franchises) that say "Free Refills on Large Drinks Only." WTF?
Bringing it back around to CDs, do bands like Metallica, BackDoor Boys, Britney, etc. really need to earn hundreds of millions of dollars? How rich is rich enough? There is a point where you can pretty much afford anything you want. Metallica owns their own jet for Christ's sake. Who do they think they are? Steve Jobs?
MacSlash: News for Mac Geeks [macslash.com]
Re:Hmmm (Score:1)
Re:Not so clear-cut (Score:2)
So yes, if the cost of getting the CD to the distributor (whether by reduced profit, marketing, R&D, or royalties) were to go down then everyone could afford to sell CDs for $9.99...
Re:A tough one for libertarians (Score:1)
Or start mostly local, DON'T go in for RIAA contracts yet, and distribute particular tracks of their choice for free, digitally. THEN if they're good enough to attract a fan base, negotiate from a stronger position, if they really want to sell CDs en masse. Under current law, that's legal.
Re:What about the UK? (Score:1)
What situations like these make obvious is that corporations wish to reap the cost benefits of a "Global Economy" by obtaining resources at the low price possible. When I say resources, I mean everything: Cost of Facilities, labor, raw materials, etc. At the same time, corporations are lobbying (and successfully, at that) for laws that restrict where we can buy our media, how we can view it, and where we can view it.
It's a double standard in the worst way, and it's all in the name of God Money.
In the case of the music industry, they think they can get what they what by throwing money into overcoming any obstical that threatens their insane amount of profits, and then further gouge consumers to make up the difference. The problem is, it's almost always worked. They've gotten almost everything they want; the DMCA is the most recent example.
In my opinion, the situation WILL change. However, it's gonna be one hell of a battle: The music industry have rather large war chests that have been filled by gouging us for all these year.
o/~ "They stab it with their steely knives, but they just can't kill the beast." o/~
Re:How many of you think.... (Score:2)
Hmmm kinda sounds like what a company in Redmond might experience.
Re:Before you americans complain about cd prices.. (Score:1)
Re:Probably not cheaper CD's (Score:1)
True, but merchadisers will be more willing to offer those low, loss-leaer prices if they can actualy advertise them. Not much incentive to cell a new CD at $11.99 just to get people in your store if you can't actually, uh... tell anyone about it.
There might be a downside to this plan... smaller, cooler record shops can't compete on price with the big boys (economies of scale and so forth). Sometimes the smal shops are the only places you can find independant, imported, or just plain cool music... Wal Mart's nice if you want the new Trisha Yearwood CD (ack), but what if you want the latest import Blur or Super Furry Animals single?
Now what's the excuse (Score:4)
Mp3 to Vinyl (Score:1)
Re:CD Production Amounts to an Oligopoly (Score:1)
Well, my brother has played on a variety of Sony and MoJazz albums, and his ska band just turned down a Sony contract because they wouldn't see any money from the disks until they sold approx. 75,000.
I know a lot of musicians, particularly, jazz ones, who lost money selling 50,000 CDs.
Not sure if that falls under "proof", but that's where my numbers/info come from.
Big mistake: don't follow Apple's path (Score:1)
If CDs cost the consumer, say, $3 or less, the industry would simply explode, and make a small lucky group even more astronomically wealthy. Let's say it cost $1 for a CD. People would buy them like Coca Cola at a vending machine; I'd buy a few CDs all the time and just throw out or give away those that were duds, which in the long run is a hell of a lot more profitable for the distributors, because they'd be moving an avalanche of product.
The first distributor to get their CD prices instantly down to $2 at retail will win big.
Re:Before you americans complain about cd prices.. (Score:1)
It varies across Canada, with BC (the province above Washington state) having cheaper prices (12-15 CAD) than, say, Saskatchewan (14-18 CAD)--largely because of the a&b sound music chain in BC and the larger population. With the PST (provicial tax) and GST (federal tax) a new CD in BC will end up costing you 14-18 CAD. But 1 USD = 1.5 CAD (well, more like 1.47 right now), but this still means that new CDs in BC end up costing you only 9-12 USD! Of course, living in California this doesn't help me much
Re:spot the troll (Score:1)
Re:Do unto others (Score:1)
Except, of course, with MP3s. *smile*
Now, if record companies were forced to sell their commodities to more than one distrubuor -- say, make MP3s a competing medium where the two could go back and forth, we might have something.
Re:Do unto others (Score:1)
Great King Capitalist (the man who invented capitalism) thought up a solution to the problem of Corporation X and Y collaborating. If you can't tkae your money elsewhere, leave it in ytour pocket. Sure, you have to go without CDs for a while, but if enough people feel strongly about it, the CD comapnies will either change their ways or go out of business. It may not be very fun, but no one made a rule saying the CD companies must produce CDs at a reasonable cost for your enjoyment.
Now, if record companies were forced to sell their commodities to more than one distrubuor -- say, make MP3s a competing medium where the two could go back and forth, we might have something.
Another nice thing about capitalism, is if you don't like way corporation X or Y works, you get to start corporation Z. Get some venture capital, ge contracts with some recording artist, and produce your own MP3 albums. If your way is acutally better, you will win, and CDs will lose.
What did it cost consumers? (Score:2)
Re:A tough one for libertarians (Score:2)
Anti-trust is probably the biggest weakness on the economic side of libertarian theory. The biggest weakness overall is probably what do you do with children? I mean, babies are supposed to be pretty much property, but adults are supposed to be free to do whatever they want. So can a 16 year old refuse to go to church?
The first thing to say about anti-trust is that it isn't as big a problem as people think it is. Sure, we're getting overcharged for CDs, but most of that is just a transfer from consumers to record companies, but money never actually disappears from the economy, so the stockholders in record companies have more money to spend. This is becoming more obvious to people now than in the past, because people are starting to realize that big companies aren't own by rich megalomaniacs (they just run them), but by retirement funds, mutual funds, and that guy down the hall who doesn't have any kids to support.
But there is an actual loss caused by incorrect incentives for the number of CDs produced. You buy less CDs because they're too expensive. It's hard to estimate what this is. A figure mmy econ professor gave was that these Dead-Weight Losses add up to about 1% of the economy, according to a study in the 1950s. There are a lot of reasons this is so small. One is that most things you buy aren't controlled by an oligopoly. Another is that the number of CDs sold at oligopoly prices isn't that much different than the number under a competetive industry.
The one that probably offers the most hope to libertarians is that it's very hard to keep a cartel going. OPEC is around 10 members, and they have trouble keeping everyone in line (remember, OPEC is "legal"). In the music industry, it's probably fairly easy for the producers to keep the price a little above the competetive price, because there isn't much incentive to try to sell more CDs by lowering the price from $17 to $15 when your total cost with all the middlemen is $13, since you wouldn't necessarily sell twice as many CDs at the lower cost. But if the cost is $13, and the cartel price is $25, you've got a lot of room to make some money. Drop the price to $20 and you can make $7/CD on a higher number of CDs. So the higher the price is, the harder it is to keep the cartel going.
The other libertarian argument is that a lot of cartels couldn't exist without favors from government. Some that I can think of specific to record companies would be:
1. Government will go to a lot of trouble to prosecute copyright violations, and the violater will be severely punished. The punishment is out of line with the damage.
2. The government will prohibit sale of stuff that might impact the record companies income, like taxing recordable media, or DCMA enforcement against Apex (regionless DVD player).
3. Copyright is a government granted monopoly. Perhaps copyright could be modified to require everyone (including the copyright holder) to license the work in question at the going rate, and then revenues go back to the copyright holder.
One that isn't specific to record companies is that the government allows for companies to commit criminal acts with no liability for the management. This tends to encourage very large corporations. It might be necessary to keep the capital markets working, but there might be other ways to do it.
I'm actually an anarchist, and think that the existence of government is itself immoral, but I think there's a lot of room for improvement even without doing away with government. Some of the above may be unconsciously stolen from David Friedman's Law's Order, on the economic analysis of law. It's available online at http://www.best.com/~ddfr/ [best.com]
--Kevin
Re:A tough one for libertarians (Score:1)
That's an interesting point. However, I think it's fair to point out that people seem more than willing to pay the prices that have been set for CDs, even if they do grumble a little bit from time to time. CD sales continue to increase, despite MP3 and other forms of digital music.
I people were really that unhappy with the price of CDs, they wouldn't buy them; they are certainly not a necessity, like food or electricity (which is also arguable). Even though libertarians in general might not be in favor of price collusion or unfair trade practices, they also believe that the federal government has no granted power to step in and do anything about it unless there is a genuine interstate commerce issue.
People talk like the entertainment industry is the spawn of satan. I don't like them any more than most, but I see that what they are controlling is a pure luxury item. Sure, I would like it better if music recording and playback technology were cheaper and more open, but, I don't have to buy it! That I do seems a validation of the supply and demand system.
As a side note, libertarians have a fundamental respect for personal liberty and personal property, including intellectual property (for which there is a constitutional mandate of protection). This respect would be extremely important to a society with little government control or intervention. Maybe copyright terms are a little too long, though. We could also use a better definition of fair use and a clarification of what buying music entitles one to.
-phil
Re:Quality of CDs (Score:1)
Of course, I only buy the special pro audiophile high-fidelity lasers, with the diamond focus, because I can really hear the difference. NEVER let your kids play with your laser, or they may bend or dull the tip.
Re:This explains alot (Score:1)
But people are not buying CDs, instead they swap MP3s on Napster. Why do you think Napster is so popular?
What do the record companies do? Lower prices? No. They send their lawyers to stop Napster...
On the contrary... (Score:1)
What I want to know is... (Score:1)
...can I now sue these record companies for "losses" incurred by purchasing their illegally priced CDs?
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Re:This explains alot (Score:1)
The Entertainment Industry is a Cartel (Score:4)
It's so obvious why the recording industry settled this case. Taking it to court would have raised the profile of the case, and eventually some journalist who thinks for himself would have asked the inevitable question: Is the mp3 issue the biggest problem facing the entertainment industry, or is the real story that the entertainment industry takes every opportunity to act in unison, to the detriment of the consumer.
I argue that we ought to be looking at a lot more than CD prices here. What about the price of movie tickets? What about the cost and features of your local cable television monopoly^H^H^H^H^H^H^H^H service? What about the retail cost of (ahem) Microsoft Windows and business applications for the PC when they are not bundled into a PC at purchase?
There are dozens of examples of consumer goods and services where no effective competition exists, at least in the industrialized countries. I am not as much of a populist as it might seem from what I've said. But, the least these multi-national companies could do is to let the retailers compete on the price.
--
Dave Aiello
It really sounds like payola too (Score:2)
Basicly, the record companies pay for the ads that the stores run, but they will only pay for the ad if the store does not advertise a price below what the record company wants it to be sold at. Well, call it price fixing or whatever, but payola is payola.
The story also goes into MP3s and how people are really fed up with paying $17 for a crap CD with one good song on it.
Re:Before you americans complain about cd prices.. (Score:1)
The last CD I bought in the uk, was for three for 18 ukp. But since I opened an account at amazon.com I haven't paid over 10 ukp for a single CD, including postage. Shame they don't get all the uk releases though.
Re:They should raise the prices! (Score:1)
RIAA reports [riaa.org] units shipped:
1997 753.1 Million
1998 847.0 Million
1999 938.9 Million
True, these are number of units shipped (not bought), but still, demand doesn't seem to be dropping off... I don't think they'd increase shipments by 12% if the demand wasn't there... Even more funny... there's a reported "cash value" of these CD's there too...
1997 $9,915.1 Million
1998 $11,416.0 Million
1999 $12,816.3 Million
And even funnier still, taking the "cash value" per unit...
1997 $13.17
1998 $13.48
1999 $13.65
Not a pretty trend, huh?
spot the troll (Score:1)
THe cost to manufactur a cd is significantly less than it is to manufacture a tape, let alone a good old vinyl LP (mmm... I love vinyl).
THey use the same master recordings, so there isnt any increase in marginal cost, the cost to produce each additional unit.
so then the question becomes why on earth do CD's cost $4-6 more than they're cassette counterparts?
In the late 80's the records companies phased out vinyl in favor of cd's. Supposedly, there was a higher production cost for CD's at this time, and the recording industry being the nice guys that they are, they passed the increase onto us, and promised to lower CD prices once the production costs fell...
Well, production costs fell, but the CD prices didnt... go figure...
and as for lowering sales... well... the recording industry had an 8% increase last year... one of their best years ever. So there is no evidence that there was a negative effect from MP3's...
The Recording industry should learn from the software industry on this one...
A friend of mine's father is a VP at MickeySoft, and the unofficial stance at MS is that low-level non-commercial "pirating" i.e. you giving your friend a copy of Windows or whatever, actually is beneficial to MS in the long run.
As in - you're gonna end up buying SOMETHING from them eventually....
Now the large scale bootleg software that is SOLD... there is a problem with that...
Re:Reminds me of my comment to Metallica (Score:1)
And we are supposed to cry over pirates...
Is there really a disparity? (Score:2)
Is it just US imports that are expensive in the UK, or is it all cds? If it's all cds, then whose fault is it really? UK imports purchased in the US also cost an arm and a leg, usually from $30 on up. Pretty much any Euro imported cds are priced similarly. It would seem like both sides are getting screwed on the imports, and this case seems unlikely to affect that.
Re:This explains a lot (Score:1)
Avoiding the middleman (Score:1)
This may not be possible for some artists, especially those with contracts which forbid any distribution of their music not authorized by their label. That always seemed like a bum deal for the artists anyway...
Anyway, how much of what you pay for a KRS-ONE CD goes toward Britney Spears' next video?
The actual total cost of cd: $0.25 (Score:1)
SlashMirror: Where to put files for fellow /.'ers
Wholesale depends on who you are ... (Score:1)
Class Action (Score:1)
Re:Would it be ironic (Score:1)
Exemption from antitrust? (Score:3)
sPh
Re:Before you americans complain about cd prices.. (Score:2)
Re:CD Production Amounts to an Oligopoly (Score:2)
Kintanon
Re:CDs have been overpriced for years (Score:2)
Also, the prices have increased, there is no mistaking that. The artists, authors and everyone is paid more - they also have to pay more for their living. I don't begrudge them that.
Yet I cannot help but wonder how much of the money remains with the different steps of the channel - out of the, say, 40 DEM or NLG I pay for a CD, how much does the retailer retain, how much the other salespeople, how much the record company - and how much reaches the creative people? And 'creative' includes authors, cover designers etc....
Re:well, not really... (Score:2)
True, but with the rise of sales, the record industry will have a difficult time proving harm in their various mp3-related lawsuits. Granted, it might not be a requirement in every case, but if it is, i'm not sure how they would offer proof of harm. Same goes for the MPAA in their DeCSS lawsuit. I hope the injunction against the defendants is overturned due to the fact that there is simply no evidence of "irreparable harm" to the movie industry.
Reminds me of my comment to Metallica (Score:2)
They're about $30 in Australia... (Score:2)
(MP3 would be a lot less popular if companies would sell me the records I want. Is it really illegal if there's no other *convenient* way to get the music?)
- A.P.
--
"One World, one Web, one Program" - Microsoft promotional ad
Trading Copyrighted Music May Be OK (Score:2)
1) A lot of parties want desperately to make sure intermachine communication never becomes "protected". For example, making it a crime to snoop network traffic between personal (as in "not at work") computers. Traditionally, "pirates" made money selling bootlegs. It is a modern phenomena that freely traded software and music (no profit motive) has become a crime. After all, the radio stations pay a pittance (and they earn PROFITS) for the right to distribute music to millions of people. Trading all music freely, and boycotting CDs, is a great way to bring this issue to the forefront -- "Does the government, or any other entity, have the right to control the information passed between two privately owned personal computers?" I say no -- if they suspect a crime, they need a warrant, etc. This decision, one way or the other, will have to come about some day.
2) Western tradition has many instances of "The People" getting fed up with racketeering capitalistic monopolies and taking the law in their own hands. People like you say "Well, if someone rips you off, don't buy anything there--just turn your back". This action may be valid for you, but not necessarily for someone else. Our culture has a long history of hatred, violence and law-breaking in the name of freedom or just exhaustion from the "gutting" these (few?) renegade corporations do to us. I simply WILL NOT abide by the rules as laid down by the RIAA. In my opinion, they are a far more criminal organization than any person trading copyrighted CDs for free. By their actions, thay may set a precedent for legalized corporate intrusion to our personal computers -- machines with microphones, and sometimes cameras attached--that will take hundreds of years to roll back.
The goal, as I see it, is for intermachine communication, of a non-commercial nature, be as protected as speech. No intrusion, for any reason, without a warrant, on a case-by-case basis. Let Let Lars, Mustaine, Dre and the RIAA search door-to-door for all I care. They have to ask for permission to enter my house--at least through the door. They can get their fscking nose out of my network.
By the way, here's a great piece of art [sulaco.org] that sums up what the RIAA thinks of your freedoms.
How many of you think.... (Score:4)
In other words, this is probably just for show. Then when mp3 pirating continues, the monopolistic pricing excuse just won't be able to hold up.
This explains alot (Score:3)
I also found it odd that some small bands sell there CDs at 10$ a pop for a small cd run, vs 18 dollars for a mass produced cd. I couldn't figure out how the additional promotional/engineering/mixing cost would not be offset by the "mass production"
This explains it.. Illegal tactics al-la microsoft.
I wonder if you have the same problem with DVD's (Score:2)
Re:Quality of CDs (Score:2)
The same applies for some of the CDs I've had on several mags. (I encountered some that were absolutely unreadable and I tried multiple different drives)
Greetings,
Re:End Result (Score:4)
Independants and people looking for better margins will pick up music from outside the expensive megamedia cartel. This is classic business technique. You break into a new market by selling a product to the stores at a higher margin for them but similar RRP to the competition. The stores love you, they want to sell your product more so you get better coverage. If they make more selling one of your CD's versus 5 of the cartels whose CD's will they push. If small bands start granting cheap radio play deals to radio stations who are they going to play more of.
MP3 is just one of the tools, the time is about ripe IMHO for an incomer into the industry to make an absolute killing by making consumers and bands far happier. In fact if they were smart a group of big name bands probably ought to get together to found such a label and get out from under the thumb of the cartel.
Alan
CD Production Amounts to an Oligopoly (Score:2)
which enjoys a higher profit margin than a music CD... except perhaps for software...
The sad thing is that, of the seven or eight bucks made by the music companies, only a dollar or so usually goes to the artist, and even that only after they pay their promotion fees et al. And then the poor artists are expected to turn around and serve as mouthpieces for the anti-MP3 folks!
Re:Before you americans complain about cd prices.. (Score:2)
What about the UK? (Score:3)
Even now, before this agreement you can expect to pay 50% more for a cd in the UK than in the US, does anyone know if this will affect prices across the board or will it (as I suspect) just serve to further increase the price difference between our countries? If this is the case what can we in the UK do to improve our situation, we are fed up with our own government supporting this kind of abuse of the British citizen.
Exactly the same situation exists for DVD (that is why I am strong support of the DeCss case) and for a while their was a strong import market until the police/ce (prompted by the government, who were themselves prompted by the US movie industry) raided all the distributors to enforce the region coding system.
Re:Reminds me of my comment to Metallica (Score:2)
A tough one for libertarians (Score:5)
I suppose one might argue (as many have) that the MP3 explosion did represent a popular response to the problem. But that too is outside the libertarian system which, if I recall, does respect IP...
- Michael Cohn