Attorney General Investigates Music Price Fixing

An anonymous reader writes "The Guardian is reporting that the US Attorney General has launched an investigation into whether or not record labels are engaged in price fixing of music downloads. From the article: 'The department of justice inquiry centers on the activities of the four largest record labels: EMI, Sony BMG, Universal and Warner Music. Subpoenas are believed to have been issued to all parties, with federal officials understood to be focusing on whether the companies have been colluding to keep the price of downloads artificially high.'"

Comments

Parent exposes duplicate link, but anyway...

[Wayne_Knight]

Is this surprising?

Everyone is greedy to a point. Some are just able to carry their greed to the point of complete selfishness and totally ignore the high percentage of people who have a hard time just keeping a roof over their heads.

What the heck will it take? Evolution of the human species? I always think back to those old Star Trek episodes where they land on some planet where the inhabitants laugh kindly at Earth's culture because they have learned to live without greed, take care of everyone, and actually enjoy sex rather than codify it.

I don't know why I want to write this... mod at your leisure. But before you bite my head off, I want to make sure all the future commenters out there read this very key quote:

"Music companies make more money when they sell a song on iTunes than when they sell a CD," Mr Jobs said last year. "If they want to raise prices, it's because they're greedy. If the price goes up, people turn back to piracy - and everybody loses."

Hopefully that will keep those crazy anti-Apple fanboys at bay.

Re:Parent exposes duplicate link, but anyway...

[SubcomandanteTorta]

BACK to piracy? Jesus, he must be living in a reality field all on his own. Gotta keep up the appearances for the record execs, I guess. It's like trying to unexplode the first nuclear bomb. He'd have better luck building a time machine and assassinating Hitler. Or trying to re-imprison Yog Sothoth back in the Pentagon before he escaped to Iraq and helped open the Seventh Gate. As long as music is commercialized in its present form, there are people who want more than they can afford, there will be piracy, theft, whatever we are calling it now. It doesn't matter how much it costs.

can the record labels justify the expense?

[spacepimp]

I've been curious why it costs more to buy an entire album via download, than it does to buy the cd... IIRC it cost the lables more to make a tape, than to produce a cd, and the prices for cd were greater than tapes. Now without having to produce a pyhsical tangible disc or tape, the costs are higher still, witrhout packaging and liner notes, and printing costs. smells like price gouging to me.

CDs

[tooth]

I don't care about price fixing of music downloads. Look at price fixing of physical CDs instead. How can a music CD cost the same as a movie DVD? And while they're at it, make them use the true CDROM standard, without drm hacks.

Re:CDs

[stunt_penguin]

"How can a music CD cost the same as a movie DVD?"

I also find it strange that a music CD can cost pretty much the same- a movie will cost tens (maybe hundreds) of millions of euros to produce, but retails for about 26 if you're lucky, and a new album costs much, much less to produce (oh, say 2 million if you're an absolutely huge band and spend like 2 years on it) and costs nearly 20 or so to buy.

That said, the cinema run pays for most of the costs of movie production, though not as often as you'd think, and by the time something makes it to HMV they're just making profit on something that a lot have people have paid 9 to see once, without taking a copy home, and with some idiot texting someone on the phone 5 seats to your left. At the same time, I still love going to the cinema and ( I went last night ) and don't begrudge a good movie a good profit.
 

Re:*Cough*

[slashdot.org]

They are 10 years late and investigating the wrong medium. I don't see anything wrong with 99 cents per song, my issues were the $21 for a CD with one decent song.

I do see something wrong with $0.99/song. I happen to like to get the entire album. I don't thing I've ever paid $21 for a CD. Maybe $17 at the most. But on average I'd say $14.-

So that bottoms out at about nearly the same price. What I don't understand is why the music industry believes that they can pocket all the money when selling a product that [1] is inferior in sound quality (unless iTunes sells lossless compression now, I've done a-b tests and I think most people will be able to hear the difference in quality on a high-end audio system) [2] is inferior in flexibility (original CDs didn't have any form of DRM) [3] is less complete (where's the booklet with lyrics?) [4] requires special software to purchase/playback and finally [5] costs them a LOT less to distribute.

The last one is really the kicker. I _know_ what distribution and production of media costs, and it's pretty clear that the music industry is behaving like a bunch of greedy bastards. If they are lucky they'll get 50% of what you pay for a CD after the cost of distribution, production and storage. Yet when they sell stuff online they want to pick up 100% of what normally goes to third parties. In other words, if I pay $10 for a CD, about half (or more) goes to the cost of media (CD, case & booklet), distribution, storage and retail cost. All this is pretty much replaced by a simple website and server, which will cost peanuts on a per-download basis. So the music industry wants to absorb all of the $5 or whatever that was saved by going online.

I guess that's fine with me. I won't download music illegaly. But I won't buy it either. If I _really_ want something, I'll get a CD. Give me reasonable prices for a reasonable product and we'll talk. Don't come bitching about sales going down and quit your fucking government manipulation.

The bands that are taking things in their own hands and realizing that recording and distributing online is something they can finance themselves should be applauded and supported in any way possible.

Re:The parable of the two farmers and the customer

[pipingguy]

How about a new parable that actually fits?

Rewind a bit...

"Pop" music depends on hype. I, for one, do not think that the screaming teenage girls in the 50's phenomenon was entirely "spontaneous". That was staged and aggressively promoted. Thus, pop music hysteria was born, and what better pent-up group of emotions than pre-adolescent, innocent females would there be to manipulate?

I Seem to Recall...

[Greyfox]

Another price fixing invesigation of the music industry a couple of years back. If memory serves me correctly, the music industry got a slap on the wrist at the time, the price of a new CD didn't drop and the industry came up with (Apparently legal) new and interesting ways to expose millions of computers on the Internet to malicious intruders in the name of protecting their franchise.

Come to think of it, the DOJ antitrust investigations really aren't what they used to be at all. When they smacked down IBM, they put the fear of God into the company! For decades after that IBM bent over backwards to obey the terms of their agreement with the department. Ever since then though, it seems like all the companies that get investigated and found guilty of anti-competitive behavior just shrug it off and keep doing what they were doing before.

I don't know when exactly the DOJ lost the ability to scare the living hell out of a company like they did with IBM, but I think they need to get that ability back. Otherwise they're just wasting my tax dollars. I think the best way to do that is to make a particularly brutal example of the next company they investigate. What? You say it's the music industry? Well... OK then! Get to it, guys!