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Universal Gets The Message
Cuts CD Prices
digitalghost




msg:305921
 4:12 am on Sep 4, 2003 (gmt 0)

Looks like someone in the music industry is finally smelling the coffee:

Full Story [news.ft.com]

The industry has drawn criticism for trying to stop piracy without offering viable alternatives.

We are besieged by rampant piracy. But these same services have shown the tremendous appeal of music.

The RIAA, after intense legal pressure and a flurry of subpoenas were probably a bit dismayed by the 30% drop in CD sales last month. Some artists are starting to get the message too. "Hey, umm, RIAA, you're suing our FANS"!

<added />changed link, pulled quotes from the Washington Post article

 

hannamyluv




msg:305922
 5:06 pm on Sep 4, 2003 (gmt 0)

several executives expressed concern that the move could reinforce the view that CDs were overpriced.

Hmm... Class action suitconcerning price fixing lost combined with the fact that any computer user these days knows that blank CDs cost pennies. Not to mention that the cost to produce a music CD is half the cost of a music tape yet a CD costs twice that of a tape to buy at the record store.

I really don't think the public thinks CDs are overpriced, they KNOW they are.

miles




msg:305923
 5:33 pm on Sep 4, 2003 (gmt 0)

Piracy is a problem, however how can these companies stop it come into your house and watch over your shoulder? I think not. In all truth they will not stop it short of shutting down the internet and we all know that that will not happen.

Cds should be the same price as tapes, but we being dumb have bought into the idea that we need the cds and pay the preimum price for them. If I am not mistaken it takes less money to burn a cd than it does to record a tape. In either case its the over inflated prices of the larger companies price gouging and they have been doing it so long that now its coming back to bite them and they dont like it.

Nobody likes paying for a cd with 2 good songs and 8 crappy songs for 18 bucks, when they can rip a cd for free and only the songs they like. I dont like having to pay outrageous prices for cds, I dont have enough money to get all the songs I want. Out of all my cds there are only 2 off the top of my head that I dont skip any songs while listening to and I have a good many cds too.

Recording companies need to know and understand that if they continue to leave the prices at 18 bucks nobody will buy them. However, they have according to this article dropped the prices, going into the store will tell.

bcolflesh




msg:305924
 5:46 pm on Sep 4, 2003 (gmt 0)

The sad fact is that Universal doesn't distro one CD I would even pay $1 for - you can't make a silk purse out of a bag of crap - teach all the giant distributors by not buying any of their releases - stick to independently produced and distributed artists - check out IUMA and other online resources - real talent is waiting for you to discover it!

[edited by: lawman at 4:30 pm (utc) on Sep. 7, 2003]
[edit reason] correct spelling [/edit]

EliteWeb




msg:305925
 5:50 pm on Sep 4, 2003 (gmt 0)

In the past 10 days I've purchased over 10 CDs, much of the reason is they were 7-15.00 and not 20-29.00 ;0) The most music ive purchased in such a short timespan ever. I still mp3 all my stuff though :P..

martinibuster




msg:305926
 6:00 pm on Sep 4, 2003 (gmt 0)

Universal did not lower the price by 30%. Universal lowered their wholesale price by four dollars, and lowered the "recommended sticker price" by six dollars, which means that the vendor is being squeezed for two dollars!

I went to buy a cd by Ernestine Anderson at the local Tower, and was stunned to see their jazz selection was shrunk to a fourth of what it used to be, and the blues section as well.

I ended up getting it in a specialty shop.

I'm listening to a lot of jazz, blues, cajun, tex-mex, zydeco, mambo, and 80's New Wave lately.

Most of the new music they're coming out with is trash suitable for teens. And most of that is a regurgitation of stuff Husker Du etc. already explored twenty years ago.

The independents have some pretty good stuff, though.

Small Website Guy




msg:305927
 4:12 am on Sep 7, 2003 (gmt 0)

(1) The price of CDs have risen FASTER than the rate of inflation, when compared to what a record used to cost back in the 1980s. This is despite the fact that everything else electronic has gone DOWN in price even when inflation is ignored.

(2) In the music store last month I saw a CD player selling for LESS the the full price CDs cost.

(3) The copyright laws have gone way overboard in protecting publishers. If you come out with a patentable invention, you only get a 17 year monopoly. Why do copyrights for books and music last for over 100 years?

(4) There is no god given right to a copyright, it's a right created by Congress, and the purpose should be for the benefit of the PUBLIC, not for the benefit of a few big corporations who donate millions of dollars to politicians in exchange for favorable copyright laws.

(5) Would anyone bother to spend a year writing a book if they couldn't make any money from selling it? Probably not? We need copyrights for printed material, but not for 100 years. 10 years would be enough.

(6) Would anyone bother to create new music without copyright laws? The answer here is YES. There are huge numbers of musicians, and hardly any make any money from selling CDs. Almost all musicians make their money from live performances. Without copyright for CDs, musicians would still have an incentive to make good music so they can become famous and make millions of dollars doing live concerts.

(7) Given the impossibility of enforcing copyrights on music, and their lack of benefit for the public as described in the preceding paragraph, I endorse abolishing them. The public would greatly benefit.

martinibuster




msg:305928
 6:45 am on Sep 7, 2003 (gmt 0)

Small Website Guy
Wow! That's a great post!

lawman




msg:305929
 4:44 pm on Sep 7, 2003 (gmt 0)

Universal did not lower the price by 30%. Universal lowered their wholesale price by four dollars, and lowered the "recommended sticker price" by six dollars, which means that the vendor is being squeezed for two dollars!

Not really, if by "vendor" you mean "retailer". For the sake of argument, assume a retail price of $18.00. Also assume that retailers wholesale price is 40% off retail (that's what it used to be when I sold the darn things many years ago). That makes a wholesale price of $10.80. If Universal is taking $4.00 off the $10.80 that makes the new wholesale price $6.80. Under the 40% discount scheme, that would make the new retail $11.34 rather than $12.00. Sounds like the retailer is 66 cents to the good.

lawman

lawman




msg:305930
 4:52 pm on Sep 7, 2003 (gmt 0)

(5) Would anyone bother to spend a year writing a book if they couldn't make any money from selling it? Probably not? We need copyrights for printed material, but not for 100 years. 10 years would be enough.

What author do you know who ever made any money by having one of the vanity publishers print his/her book? Therefore, shouldn't the argument you made re music publisher apply to written materials also.

I suppose it depends upon whose ox is being gored. If you read more than you listened, you might reverse your positions 6 and 7. :)

lawman

worker




msg:305931
 5:13 pm on Sep 7, 2003 (gmt 0)

Regardless of how you feel about copyrights and the cost of CD's, there is absolutely no justification for stealing.

Do not copy artists works that are not provided by the artist! It is theft, pure and simple. If you did not buy it, then you are stealing it.

The copyrights are not in place to 'protect' the public. The copyrights are in place to protect the artist, and I don't mind a long copyright period. If a writer writes a great book, why shouldn't there be a copyright for 100 years? 20 years after it is written it will still be the same book, but there will be a new generation that might want to read it. Why should they be able to buy it for less than the preceding generation? It still has the same inherent value, and the writer should benefit.

The same with music. A long copyright doesn't hurt the public, it protects the public by protecting the artist. This entire arguement needs to be focused on the protection of the artist. If they are protected, the music and the books will continue to flow, and creativity will not be stifled. If the public uses new technology to steal music, everyone is hurt.

martinibuster




msg:305932
 5:22 pm on Sep 7, 2003 (gmt 0)

Ok Lawman, let's put some numbers to this and see if this sticks. ;)

Universal sells a CD to your local record store for about $12 apiece and sets the suggested retail price at $18.98. That's a $7 profit margin.

With Universal's price cut, the wholesale price drops to $9.09. Universal would like retailers to cap the retail price of a CD between $12 and $13, and is hoping they'll sell for as little as $10.

So at $13, that's a $4 profit margin. At $10 a cd, that less than a dollar profit margin.

So, ok, that is a 25% drop in the wholesale price ($3 is 25% of $12).
But, the retailer is getting squeezed for at least $3 of their own profit to make that a 30% drop in retail prices- lowering their profit margin from $7 to as low as $1.

[techtv.com ]

So please correct me if I'm wrong (I'm no accountant), but it still looks like the retailer is getting shafted.

Here is what the big boys have to say about it:

[pittsburghlive.com ]
Large retailers such as Borders, BestBuy, Wal-Mart Stores Inc. and Amazon.com generally reserved judgment Thursday on the change, although several noted it could be an effective consumer lure. Several of them declined to discuss how Universal's initiative would affect their profit margins; music represents only a fraction of sales for big merchants.

"There's going to be a lot of deflation ... fewer gross margin dollars per CD, and we hope because of that, we'll attract a lot more people to the store," said Mike Spinozzi, Borders' senior vice president and chief marketing officer.

So now they are talking about CD's as a loss leader- a non-profitable item to bring people to the store. What does this mean for the cd retailer? Trouble.

dcheney




msg:305933
 7:01 pm on Sep 7, 2003 (gmt 0)

For a slightly different point of view, The Register [theregister.com] notes that this is the first price cut in 2 decades!

lawman




msg:305934
 7:13 pm on Sep 7, 2003 (gmt 0)

Thanks for setting me straight MB.

When I was in retail (1972-1987), the items I sold broke down into three basic categories; short discount items, regular discount items, and large discount items.

On the short discount items (less than 40% off retail), I stocked samples and took special orders. Regular discount items (40%) accounted for most of my inventory. Large discount items (50% and above) consisted of items such as cards and gifts.

Based on your figures MB, there's no way a brick and mortar music retailer could stay open if the majority of its inventory consisted of 30% discount items. After all, when I thought of a loss leader, I thought in terms of one hot item (say a best seller book), not the majority of my inventory.

lawman

cminblues




msg:305935
 7:24 pm on Sep 7, 2003 (gmt 0)

SmallWebsiteGuy, I agree 100%.

ggrot




msg:305936
 11:11 pm on Sep 7, 2003 (gmt 0)

I do think CD's are overpriced, but I don't think there is any problem having them priced higher than tapes. They are higher quality. Its like google adwords - they are priced higher than say some banner ads from fastclick, and they cost less for google to run (google is already burning the bandwidth through search results, fastclick isnt). But adwords are higher quality.

Then again, paying $30 for a CD is too much when you can go to a cheap concert for that much.

Small Website Guy




msg:305937
 5:36 pm on Sep 8, 2003 (gmt 0)

Music is priced like airplane tickets. The price is set at what the market will bear. People are willing to pay more for a CD than a tape, so they charge more for it.

Public libraries existed before copyright law. Benjamin Franklin founded the first public library. And Benjamin Franklin was in the publishing industry, yet he didn't have a problem with people reading his books for free at the library.

However, an interesting difference between the 1700s and the present is that, back then, printing books was actually EXPENSIVE (relative to everything else). The book had to be handset with movable type, and they could only set a few pages at a time. Back then, the cost of a book reflected the actually cost of manufacturing the book, and not the author's intellectual property rights.

Society agrees that libraries are a good thing, because it's good for poor people to be able to read books for free.

Lets push this concept one step further. ONLINE libraries would be a good thing, because it would allow poor people to read books for free, and it would be less expensive to maintain than a physical library, and maybe more convenient for the reader.

Unfortunately, copyright law prevents such a logical next step as an ONLINE library. The University of Virginia has a nice eBook library where you can download books to read on your PocketPC, but only books published before 1923.

Long after an author is dead, why are his books still copyrighted? It's not the author benefitting, it's a big corporation.

worker




msg:305938
 6:34 pm on Sep 8, 2003 (gmt 0)

People can still go to the library, and get a library card, and check out or read books there.

They can't go into Barnes & Noble and steal one.

As long as the copyright laws are still in place, it is theft to download books or music that isn't specifically being offered for free by the owner of the copyright, or their agent.

While I'm happy to see prices coming down for CD's, I think it is horrible that mass theft via online downloads, is one of the driving forces behind this change in price.

lawman




msg:305939
 7:22 pm on Sep 8, 2003 (gmt 0)

Benjamin Franklin founded the first public library.

I'm sure the Ancient Greeks and Romans would disagree. :)

because it's good for poor people to be able to read books for free.

I'm against illiteracy and ignorance, a person's station in life notwithstanding.

ONLINE libraries would be a good thing, because it would allow poor people to read books for free, . . .

I presume these poor people who can't afford books will have to go to their public library to log on.

. . . and it would be less expensive to maintain than a physical library, and maybe more convenient for the reader.

I'd rather take a book into the bathroom than my wi fi connected laptop. :)

Long after an author is dead, why are his books still copyrighted? It's not the author benefitting, it's a big corporation.

What if a person wins the lottery and then dies? Obviously the winner wouldn't benefit from the lottery and neither would any corporation. However, the lottery winner's estate would benefit. That's the way it works with any other type of property including intellectual property. The author's heirs, assigns, or other designees would benefit.

Besides, what big corportion are you talking about? The publisher? It isn't entitled to a windfall. The author's heirs (or whomever the author designated) are entitled to whatever the author would have made, and the publisher makes whatever amount its contract with the author allows it to make.

lawman

choster




msg:305940
 7:34 pm on Sep 8, 2003 (gmt 0)

Reading about the rise and fall of Tin Pan Alley puts the current debate about technology, intellectual property, and the creation and destruction of industries in perspective. That is to say, a music industry that employed tens of thousands was destroyed in the space of a few decades, but a new one that employed tens of thousands arose in its stead.

For that matter, reading about the desperate anguish that arose from the demise of the U.S. agricultural and frontier economy in favor of manufacturing around the same time puts into persective the desperate anguish of today as the manufacturing economy is displaced in favor of information industries such as finance and technology.

Small Website Guy




msg:305941
 8:41 pm on Sep 8, 2003 (gmt 0)

Middle class people who could afford to buy books use libraries also.

The library isn't much different than illegally downloading a book from the internet. In both cases, you read the author's book, and the author doens't get any money out ouf it.

No one is arguing that under current law, it's illegal to make unauthorized copies of books and music. The court won't even care that everyone else is doing it, or that the law is unfair.

I'm arguing that the laws are wrong, and in place to benefit special interests and not the public as a whole.

The public libary example demonstrates that society believes that it's important for people to have access to books and other information. This benefit of public access overrides the author's rights to the book.

If the copyright laws only granted the author 20 years, would people stop writing books? No they would not. 20 years is long enough to make plenty of money. Yet a 20 year rule would open up large numbers of books that peopel could download from the internet to enjoy for themselves.

And regarding music, I doubt that a law granting public access to music once a musician makes it publicly available would have much impact on the musicians (who don't make much money from selling CDs anyway).

IP law has to be balanced to give the greater good for the people as a whole.

killroy




msg:305942
 9:00 pm on Sep 8, 2003 (gmt 0)

Funny, and tehre I thought in my ignorance that copyright and patent laws are there EXPLICITLY to protect the public, NOT the author. They protect the public by giving INCENTIVE for authors, inventors and creators to write, invent and create.

Adn aI believe the current incentive of 100 years is simply not necessary. I believe 20 years, hell even 10 years of copyright protection would NOT put off any author from writing who's worth reading.

In the contrary, I DO believe that if music was relieved of copyright protection after 10 years, it could enojy a second renesaince within the lifetime of it's original listeners. It would be, once again after fallign out of favour, played in radios and homecomputers.

If you try for a bit to imagine a world with 10 years of protection of intellectioal property, 10 years of incentive to create, and 10 years of oportunity to recoup investment, you just might see a world that is NOT in chaos and that is NOT VOID OF CREATIVITY.

And perhaps, you might imagien a world that is better then todays morass of large publishing and distribution houses slavign both artists and inventors as well as their paying public straight to their oversized wallets.

SN

PS: end rant

lawman




msg:305943
 10:13 pm on Sep 8, 2003 (gmt 0)

This benefit of public access overrides the author's rights to the book.

Scenario 1:
In real life, there are a lot of poor people and some middle class people who want to hire me but can't afford me. Does that mean that the benefit of public access to my knowledge, experience and reputation overrides my rights to sell them?

Scenario 2:
Assume I had a child with a problem that required lifetime treatment and that this was very expensive treatment. What if I wanted to capitalize on my specialized knowledge and experience to pay for lifetime treatment and I chose to do so by memorializing this experience and knowledge in a book. My intent was to fund treatment through profits from the book even after my death. Would the public benefit override my child's treatment?

Scenario 3:
Or what if I chose not to publish it. Could I just keep it under my mattress and pass it along to my family? Would I have any rights regarding the book? Or would the benefit of public access override my rights?

Scenario 4:
What if a thief stole the book and published it without authorization? Would the public's rights trump my rights (assuming I had any to begin with)?

So many questions, so little time. :)

lawman

Small Website Guy




msg:305944
 4:46 am on Sep 9, 2003 (gmt 0)

Responding to 4 irrelevant scenarios:

1. Hiring someone isn't the same as reading a book or listening to their music. An author suffers no harm when someone checks his book out from the library and reads it, if that person otherwise wouldn't have actually purchased the book. On the other hand, someone reading the book might like it so much that he would go out and buy one of the author's newer works.

2. Having a sick child doesn't grant you any special rights that anyone else doesn't have.

3. Copyright law applies only to published works. Unpublished writings are considered "trade secrets".

4. Stealing trade secrets is theft, we are not talking about that, we are talking about what people can do with your works after you CHOOSE to publish it.

digitalghost




msg:305945
 4:57 am on Sep 9, 2003 (gmt 0)

I thought it was pretty common knowledge that the current copyright laws were passed because of special interest cash and backroom politics.

C'mon, a drug company can spend millions on research for a new drug and get a patent that lasts for what? A decade? I can write pure drivel and get a copyright that will last until my children's kids have grandkids...

I live in a music town, the majority of artists aren't too pleased with the RIAA. Now the RIAA is offering amnesty that they don't have the authority to offer.

I'll digitally copy my music from digital Dolby TV and the RIAA can bite me. ;)

martinibuster




msg:305946
 4:59 am on Sep 9, 2003 (gmt 0)

If you are interested in copyright laws, then I highly recommend you read Professor Lawerence Lessig's blog [lessig.org].

Jsut thought I'd share a really good resource.

Professor of Law at Stanford Law School
Founder of the Stanford Center for Internet and Society
Author of The Future of Ideas and Code and Other Laws of Cyberspace

If you are interested in copyright laws, especially as they pertain to the internet, Professor Lessig is required reading.

lawman




msg:305947
 7:02 am on Sep 9, 2003 (gmt 0)

Responding to 4 irrelevant scenarios

Haha, too much time on your hands? :)

Hiring someone isn't the same as reading a book or listening to their music.

Whew. I wasn't sure how far you were willing to take your "benefit of public access" argument.

Copyright law applies only to published works.

That is incorrect.

Having a sick child doesn't grant you any special rights that anyone else doesn't have.

Under your plan there are no exceptions? You mean that, rather than being taken care of comfortably at no dollar cost to society, my little darling will have to rely on the good nature and largesse of strangers? :(

Stealing trade secrets is theft, we are not talking about that, we are talking about what people can do with your works after you CHOOSE to publish it.

So before it's published, it's considered theft, but after it's published, it's considered public domain? :)

lawman

lawman




msg:305948
 7:06 am on Sep 9, 2003 (gmt 0)

the RIAA can bite me

Haha, DG, you can say in 5 words what would have taken me a whole paragraph.

BTW, how long do you think it will take SWG to figure out that I'm just yanking his chain? ;)

lawman

musicman




msg:305949
 9:44 am on Sep 9, 2003 (gmt 0)

Hi SWG
The library isn't much different than illegally downloading a book from the internet. In both cases, you read the author's book, and the author doens't get any money out ouf it.

Not true - here in the UK the author gets a royalty for every time their book is taken out.

Hi Killroy
And regarding music, I doubt that a law granting public access to music once a musician makes it publicly available would have much impact on the musicians

I'd be stuffed, for one :( I write music that gets played in TV programmes, I get a royalty whenever the music is broadcast. If I lost the rights to my music as you described, I'd have no income. No-one would write music for TV, Films, commercials etc.
If you try for a bit to imagine a world with 10 years of protection of intellectioal property, 10 years of incentive to create, and 10 years of oportunity to recoup investment, you just might see a world that is NOT in chaos and that is NOT VOID OF CREATIVITY.
And perhaps, you might imagien a world that is better then todays morass of large publishing and distribution houses slavign both artists and inventors as well as their paying public straight to their oversized wallets.

There's where the REAL battle should be, in helping artists avoid being exploited by large corporations. Help support artists to keep their rights for themselves (and therefore the income). Like I do :)

killroy




msg:305950
 9:56 am on Sep 9, 2003 (gmt 0)


Copyright law applies only to published works.
That is incorrect.

I believe it is. If I write a book, whitch happens to match yours letter for letter and can PROVE that yours has NEVER been published and I could not have POSSIBLY have seen it, I would NOT have violated your copyright.


I'd be stuffed, for one :( I write music that gets played in TV programmes, I get a royalty whenever the music is broadcast. If I lost the rights to my music as you described, I'd have no income. No-one would write music for TV, Films, commercials etc.

I have produced TV myself, and I think 10 years is plenty of tiem to recoup investment. If not, nobody would work more then a few years, because they could just retire on the money they make over the next 100 years. Heck, I'd take out a lone using the license income AFTER MY DEATH as security, and live a good life after just a few years of creative work.

I'm not arguing waht is legal or not, I'm arguing what is sensible. And I'm certainly NOT the first person to point out htat the original purpose of patent and copyright laws has been lost with these unreasonable extensions. Please NOTE that these are extensions that were FORCED by powerful large corporations into corrupt governments long after the ORIGINAL LAWS were passed.

SN

This 39 message thread spans 2 pages: 39 ( [1] 2 > >
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