Slashdot Mirror
RIAA Says CDs Should Cost More
EatingSteak writes "The folks over at Techdirt just put up a great story today, with the RIAA claiming the cost of a CD has gone down significantly relative to the consumer price index. The RIAA 'Key Facts' page claims that based on the 1983 price of CDs, the 1996 price should have been $33.86. So naturally, you should feel like you're getting a bargain. Sounds an awful lot like the cable companies saying cable prices are really going down even though they're going up."
Funny (not as in ha ha) because as I recall back in 1983 the record companies acknowledging that CDs *were* expensive but that the price would come down as the number of CD sales went up. Back then a record album ran around $7 US and CDs were anywhere from $13-18 US and I could as a 13 year not afford many CDs, but did I ever load up on all those punk 45s, likely outspending what I would have on CDs over time. What the record companies can not apparently figure out is that if priced affordably, some sales are money in the pocket versus no sales and no money in the pocket. Judging from the precipitous fall in music sales and revenues over the past few years from lousy music, over priced music, DRM and bad will from the RIAA, they obviously just don't get it. Now, if they were smart.... record companies would *give away* music from bands just starting out and from the biggest bands out there and make money from tours. Bands in the middle of the spectrum could be the "middle-class" of the record companies that could provide the most profit after small bands graduate into the middle class and start selling their music, touring as they want.
Visit Jonesblog and say hello.
If they should cost more, they would! It's simple supply vs demand! I mean, the RIAA are cartel for all intents and purposes. Who are they to be complaining?!
I suppose we should have to pay $1300 for a Commodore 64 nowadays, too?
You don't even want to hear how much the RIAA thinks you should have to pay for a machine capable of a billion calculations per second...
Seriously, jack them up. That way, when less CDs fly off the shelves, they'll start making some good decisions on how to run the industry and actually attract customers. Throwing us tons of garbage every week for a "good price" doesn't mean they are doing us any favors.
That's absolutely right, compared to 1983, the relative price is down, early adopters pay a price!
Thats an age old truth.
Now, thanks to economies of scale and lots of hours of research, it's much cheaper to produce the individual cd.
Not only that, due to IT it is also cheaper to produce the individual album.
I'm still waiting for legally downloadable music to be as problem free and cheap as the distribution method should allow.
until then, Happy Mp3.com. (yes i stopped buying cds the first time i got a malware loaded cd).
The distribution is already a lot cheaper, which means that the price has to cover three things: Development of the site, music production and marketing.
Please lower the price and drop the drm.
Blah blah sig blah blah blah irony blah blah
why does it seem like every week the riaa has some new, bizarre claim about the cost of music, or some completely inane justification for them to charge us all more money for our cds? i spend a good portion of my life in studios, and while it does cost quite a lot of money to record / produce / master a big commercial release, there's no way that a cd would ever cost $33... but then again, i don't work for the riaa, so i probably don't know the 'real' truth...
now is the winter of our discotheque
I still won't buy them.
Pulp Audio Weekly - Geek News and Reviews
My pirated music collection just tripled in value! I guess it's worth the trouble to back it all up to DVDs now.
Yes. This is a fundamental intersection between two economic concepts - Inflation and Moore's Law.
Inflation indices imply that prices have risen over the last few decades. However, those numbers are averages across a wide variety of (generally non-technical) goods. There are numerous causes of inflation, and I won't discuss that here.
Moore's Law is not strictly speaking an economic law, but with the benefits of Moore's Law, we see electronics and machines become more affordable. In all likelihood, production costs have plummeted for the actual music, and I assume CD error rate has gone down. As a result, the cost to make a CD, from start to finish has seen the price of its components fall (as measured in utility/cost). Therefore, the price of CDs don't have to rise.
Die!-a-RIAA!
Also, the cost of international phone calls has declined markedly since 1925. Based on inflation, we should now be paying $500/min for international calls. Don't tell the telcos!
Similarly, the cost of motor cars has come down since the Model-T Ford - they should cost $1.5 million each (based on inflation - discounting better performance these days)
Or... perhaps technology and economics has some influence on the price of things too..
It is the ultimate irony. The record industry is trying control information in the form of content, and the US Federal Reserve Bank is trying to control information that refelcts itself in the form of money and markets. So now the Fed is lying to us about the value of our money, and long behold it has the effect of destroying the pricing power for those who are lying to us about "protecting" artists, and branding about other lies such as saying copyrights are "property" rather than a personal regulatory monopoly.
Well, guess what. As society enters the information age, that means that information is becomming commoditized and the service value of information starts to exceed the control value. So liars who control information like Hollywood and the Fed (and Microsoft) are in serious trouble. How ironoc it is that, unlike the service sector, they will have no pricing power as they destroy each other.
The RIAA 'Key Facts' page claims that based on the 1983 price of CDs, the 1996 price should have been $33.86.
No, because CDs are by far cheaper to mass produce than cassettes or, in all fairness, vinyl. For a small production run of vinyl, i'd expect to spend $1.00 per disc including a paper dust cover. CDs I would expect to spend 1/2 that with a basic sleve for a small production run. Cassette I would expect to spend double that of CD.
Yet for some reason, they sell commercial cassettes for less than a CD.
Not to speak of mastering seems to be done by some yahoo with protools.
There is no sanctuary. There is no sanctuary. SHUT UP! There is no shut up. There is no shut up.
FTFA:
For every album released in a given year, a marketing strategy was developed to make that album stand out among the other releases that hit the market that year. Art must be designed for the CD box, and promotional materials (posters, store displays and music videos) developed and produced. For many artists, a costly concert tour is essential to promote their recordings.How about you all agree to stop marketing the CDs and just let the people choose what they think is good, rather than trying to tell them? We'd all save millions.
They can't be serious. Maybe, instead of "CDs should cost more" it should be "Record execs should cost less".
After all, it's not like manufacturing cost should be an issue. Hell, my great-uncle used to work at a post office... When someone mail-ordered a CD and the address was wrong, the sender of the CD would not pay to have the package forwarded. Instead, they'd just ship another package, because this was apparently cheaper. The post office was told to throw away the CDs and wait for the subsequent re-delivery. Of course, then people began stealing the discs from the garbage, so the post office had to start DESTROYING them (by incineration, iirc) every week instead.
Long story short, when you order a CD online, the finished product cost more to ship than it did to make. The price is still totally unjustified, especially considering that the artist's cut is almost nothing.
People who exploit others for profit are the scum of the earth, and record companies scam pretty much everyone else in the music biz, from the artist all the way down to the consumer. It's disgusting.
One of these days, I'm going to cut you into little pieces.
CDs are STILL $13-18 (unless they are at Costco or "on sale", usually), but back in 1983, a decent computer cost $2000 (you can't even buy a computer that bad now, for as little as $299).
Even a nice calculator was about $50 or so (better ones now for under $20). A Color TV (A heavy CRT, 13 channels, click-click tuner) was 2 - 3 times what they cost now (for 121 channels, multi inputs, remote, etc. etc.)
The list goes on and on and gets "worse" (for the RIAA argument) when adjusting for inflation. LOTS of stuff is far cheaper than it has ever been.
Bah.
This issue is a bit more complicated than you think.
Quantity 10,000: USD$0.79.
Explain to me again why these fsckers cost $16.00?
Now then, what was the per-unit pressing cost, quantity 10,000, of a CD in 1980? If we calculate MSRP as a percentage multiplier of the raw pressing cost, what should music CDs cost today?
Schwab
Editor, A1-AAA AmeriCaptions
Ben Woods' argument is correct, if we are talking about a piece of electronics, where, say, 90% of the cost of that piece of electronics is in the production. However, only a very small amount of the cost of the cd (less than 1% if 1c for the CD and 3c for the case/cover) is in the PRODUCTION of the CD.
Most of the cost of a CD is in the marketing and (of course) profits for the record company. Sure there are a few extras, like the pittance they give the artist, but the majority of the cost is MARKETING. This gets more and more expensive as they get more and more ridiculous in their marketing and the cost of marketing increases over time.
Another spin might be that CDs are now more expensive to produce due to all the non-redbook copy prevention measures that they keep trying to put on "CDs" now.
Please don't send a Word document when a text file will do the job.
Me, I tagged the story "overpriced".
Property is theft.
This is one of the most laughable things I have ever heard.
CD prices were always higher than the equivalent cassette tape, which was much more complicated to produce and had the same production and marketing costs.
FTA: For example, when you hear a song played on the radio -- that didn't just happen! Labels make investments in artists by paying for both the production and the promotion of the album, and promotion is very expensive.
The only thing that gets played on the radio is the latest Britney Spears bubblegum crap-ola. In fact, Mandy Moore recently apologized for making such bad music
So we have to pay for all the payola in getting the radio stations bribed to play the songs on the radio.
And then when a CD gets scratched, broken, or stolen, do we get a free replacement? Oh no, we have to pay the full retail cost all over again even though the RIAA wants us to think that we have somehow "licensed" the music from them.
I am glad that they are sweating, which they must be in order to be trying to play the "victim" game. The days of the Internet are here to stay, and bands can finally distribute their own music without getting shafted.
In the linked article it says that only 10% of all CD's make a profit. The other 90% of CD's put the bands into debt to the record companies, making it a really bad deal to sign a record contract. Courtney Love does the math.
The RIAA sounds desperate, and I hope they are -- it would serve them right.
... and in the DRM, bind them.
Playing devil's advocate for a moment, what you say about the cost of manufacturing a CD is absolutely correct. What you're not factoring in is the increase in cost of studio time (rent goes up with inflation, as does the price of labor for the guy(s) running the boards), artist payments (in theory, this should also go up with inflation), marketing costs (have you seen the price of a 30s spot during the Super Bowl?), and of course the costs to pay RIAA's troupe of lawyers and executives.
Does it have to be that expensive to produce music? Absolutely not! With modern technology, an aspiring artist can record RIAA-quality (ha!) music at home for a mere fraction of the cost of studio time. Grassroots marketing, word of mouth, and touring can make for both cheap and effective promotion. Cutting out the middle man (RIAA) allows more money to go to the right places (production, artist) while still lowering prices. Will the RIAA ever get their acts together and do the Right Thing (tm)? I doubt it, since they're the quintessential middle man. Like the GEICO commercials, artists need to cut out the middle man and pass the savings on to you.
If you look at most computer or home electronic prices, the trend has been downwards over the past twenty years. Not only downwards when adjusted for inflation, downwards when adjusted for performance, but downwards in absolute prices. I wish I had stronger memories and figures to back this up, but I do remember as a child, (I was born in 1979), people just had a wildly different attitude towards electronics. A VCR, cable television, a microwave oven, color TVs...all of these were important luxury items. This could be just a artifact of me growing up, but a color television set was on par with say, a grand piano as far as how expensive it seemed.
I do have better data for computers. I have a 1994 price guide to computers when bottom line computers, 386s cost around 1500 dollars, twice as much as a midrange new desktop would today.
All of this is stuff most readers here know. (Although I am expecting at least a few people will correct my specifics.)
What I have noticed, however, is that many people have not psychologically adjusted to this, even when they intellectually know it is the case. I have noticed this most at my work at Free Geek, where often people come in, with a Packard-Bell Pentium, and explain at some detail that the quad speed CD Drive works, if you just wiggle it around first. Or that their 14 inch monitor still works, but it might blink off every few minutes. Meanwhile, we get truckloads of P-4 systems every few days.
The point is, I think many people (often older people, but not always that much older), still have a mindset that computer and electronics are rare and valuable, instead of being the mass-produced, quickly obsolete, pieces of junk they are. And I think that many of these people are honestly confused about how valuable their product is. Of course, the RIAA people know that AOL mails out millions of CDs a month (do they still do that?), and that CDs cost "under 1 dollar to make" ( wikipedia on CD manufacturing). Of course they know these things intellectually, but I really do think they have a mindset that they are producing a rare and valuable resource, and that they aren't asking for much in that they haven't raised their prices with inflation.
Post-scarcity takes some getting used to. I consider the entertainment industries inability to come up with a more financing method that doesn't involve creating false scarcity to be one of the less harmful inabilities to adjust to a new paradigm. I consider the fact that the US political and industrial leaders really don't understand (even though they know) that the US has lost textiles 50 years ago, consumer items 40 years ago, vehicle manufacturing 30 years ago, electronic manufacturing 20 years ago and computer manufacturing 10 years ago (numbers somewhat generalized), and that all of those things are now produced overseas for a fraction of a US worker's hourly minimum wage, to be a much more dangerous symptom of the same disease.
Hopefully I didn't put any [] around my words.
Maybe the RIAA doesn't believe in free-market economics, but the price of a product follows the S-curve, and should drop from its introduction price, not stay there forever. Lunacy to expect or whine that a product should remain in the "early adopter" phase of the S-curve for the life of the product.
Slashdot: Playing Favorites Since 1997
It's clear that no one would pay $1300 for a C64 these days because computers have gotten so much faster for the money. But what's the comparison with music? You cite an example of how old computers aren't worth much because new computers are so much better, so what are you implying, that old music was worth a lot more because new music isn't anywhere near as good? Is new music so much worse than older music that it's not worth paying that much anymore, and the price had to fall on the new stuff, like prices fall on old computers? Obviously not, because a lot of these CD's being sold now have the same music on them that they had in 1983. The march of technology and Moore's law doesn't really say anything about the price of music over time.
The only reason I expect a CD to be inflation-adjusted cheaper today than in 1983 is that in 1983 they were still selling primarily tapes and some vinyl, and the only people with CD players were mostly audiophiles and early adopters, and the CD players had cost them a fortune and were part of premium stereo systems. No one had CD players in their cars, or portable ones, CD players were big, expensive components for rich high-end audio enthusiasts, who were clearly willing to pay a huge premium for the CD experience. The price of a CD in 1983 should be inflation adjusted and compared with the price of an SACD today. CD's are now the lowest-common-denominator standard format for the masses and should be priced as such. Had the price of CD's not fallen dramatically since the 1983 price, they would never have gotten popular and remained inaccessible, which would be an example of the RIAA companies shooting themselves in the foot, reducing profits trough overly high prices and small unit sales.
So pricing changes since '83 are a silly comparison, because the product's placement in the market changed entirely since '83. CD's have been the de facto audio standard now since at least 2000, I'd like to see what inflation adjusted prices have done from 2000-2007. That would indicate what CD prices have been doing.
Can anyone tell me how to set my sig on Slashdot?
You have to understand corporate math. That math says that if you made 15 million in profit in year one, and 10 million in year 2, then you have taken a 5 million loss in that second year. That thinking convolutes all kinds of statistics.
(...goes to books to make sure it's the right number...)
And that's with my shoddy economies of scale. I can't even imagine where the RIAA gets this kind of thinking, but I guess they gotta do what they gotta do to keep up with the price of cocaine, right? Can't imagine the weak dollar has helped them with their fine imported Columbian stuff.
In most cases the cost per ounce of talent gives a DIVISION_BY_ZERO error.
pissed off, shake your head, blaspheme god/allah/budha/your_own_divinity, shoot your computer monitor, .... or you can vote with your money.
I used to spend quite a bit of money on music, movies and theaters. I recently spent a weekend working out my budget in the last 15 years (wonder why I kept all these shits for all these years), and found out I spent on average 5K per year on those items (before I made my decisions, that is). The biggest chunk goes to CDs and cassette tapes. It's even more than what I spent on food (Unbelievable, I spent less than 50$ per week on food).
Then, in early 2001, I decided not to do that anymore. I haven't bought a CD since then, went to theaters only twice, rented movies less than 10 times. Now, every time I crave for movies, I go out for an excursion in the forest or in the mountain, or get a good book (which cost the same as going to theater but the pleasure of reading certainly lasts longer). Well, all these monies I've saved...
I wish I've done this 20 years earlier. Imagine all the monies saved, with wise investment or accumulated interest, my pension fund would have been much better off.
I'm not saying you should give up all these, but you certainly don't have to pay your "taxes". You can certainly do something about it though, like give less money to those fatty RIAA executives, for once.
Another reasonable and well thought out claim from the RIAA. Someone inform Intel that a single transistor should still cost about a dollar, they're losing money by the fistful.
m
m icroprocessor_timeline.pdf
They figured out how to make them faster better cheaper. Have you seen Intel's R & D budget? Intel has figured you can make a profit in volume sales. Making lots of units at low prices can cover very high production costs. They spend lots on their product to improve the quality and value. I wish I could say the same for the RIAA who in the same time frame have not improved the number of minutes or tracks on a CD and reduced quality by over compression, loss of dynamic range, and technical problems with CD's that don't work and break things.
Q1 outlook 2007 for R & D for Intel;
Expenses (R&D plus MG&A): Between $2.6 billion and $2.7 billion. In addition, the company expects a first-quarter restructuring charge of approximately $50 million.
http://www.intel.com/intel/finance/bus_outlook.ht
If the RIAA kept up with Intel in the same time frame, they would have CD's out with the $33 price point, but would have to kept up with the times. The 8088 processor ran 4.77 Megahertz. Most current Prescott P4's run at 3,400 Megahertz (3.4 GHZ)
The 8088 had 49,000 transistors in 1978. The 286 had 134,000 transistors in 1982. The 386 had 275,000 in 1985. The 486 had 1.2 million in 1989. The pentium in 1993 had 3.1 million transistors.
Since we are looking at a time frame of "The RIAA 'Key Facts' page claims that based on the 1983 price of CDs, the 1996 price should have been $33.86." we can take the numbers from Intel's 1983 processor the 286 at 134,000 transistors and the 1996 Pentium processor at 3.1 million transistors. (Pentium II in developement at 7.5 million transistors released a year later in 1976)
In the same time frame the CD went from 8-12 tracks average to 8-12 tracks average. To keep up with technology like the computer, it would have had to go from about 10 tracks to about 300 tracks at about the same selling price. Napster almost reached that value.
Intel data gleaned from; PDF aleart.. http://www.intel.com/pressroom/kits/core2duo/pdf/
If Intel tried to continue selling 4.77 MHZ CPU chips today at adjusted for inflation prices, they too would have volume sales problems. Somebody wake up the RIAA and have them smell the coffee.
The truth shall set you free!
"Fact: The unit cost of a single CD, silkscreened, in a jewel case, with six-page four-color liner notes,
Quantity 5,000: USD$0.91.
Quantity 10,000: USD$0.79.
Explain to me again why these fsckers cost $16.00?"
It's real simple:
+$16.00
-$12.01 (75% cut for recording label)
-$01.33 (8.33% cut for artist)
-$01.33 (8.33% cut for retailer)
-$01.33 (8.33% cut for manufacturing & distribution)
-------
$0
I was set to distribute Funny mod points in this topic, but instead felt the need to point somthing out.
The artists are building up tolerance to the drugs they use to come up with the songs, if we, as scientists, simply produce stronger drugs, we should be able to effectively prevent increases in music prices.
Wanna fight ? Bend over, stick your head up your ass, and fight for air.
Studio-time is trough the floor. It used to be just a few decades ago that a studio capable of producing comercial-quality records cost on the order of a house. These days you get superior signal-handling from gear that costs literally 2-3 orders of magnitude less. Hell, $10K will buy you equipment good enough to win awards with your records, I know because my co-worker across the hall did 2 weeks ago. (Spelemannsprisen, the most prestigious Norwegian music-award)
the price of labor for the guy(s) running the boards), artist payments (in theory, this should also go up with inflation),
Actually, it should go up proportionally to average *salary*-increases in a society, which is *MORE* than inflation if the society is getting richer. This is however in this particular case more than offset by two facts. One, modern equipment is *much* less labour-intensive and two, the lower leads to increased availability, which leads to more people capable of dealing with much of it. Many bands even do a lot themselves. Yes they'll need one or two (preferably good!) sound-technicians for the couple of days the actual recording takes. But let's face it, that works out to paying an engineer for a week. For well-selling records its down in the noise.
Marketing costs whatever you want it to cost. You can spend $100 or $100million promoting a single album. That was always so.
Fact is, the RIAA is just whining. There's nothing whatsoever stopping them from selling an album for $35. I encourage them to try. People are then, offcourse, free to simply not *buy* that. But that's a free market for you. I guess they're too used to monopolies and dictating terms.
So the RIAA says that CDs should cost more, eh? Well, with piracy rates skyrocketing, why should I care? People already pirate music because:
1. Nobody wants to shovel out $25 for a CD with 9 crappy songs we don't want and 1 that we do.
2. We can make out own compilations with the songs we want on them, in the order we want. Nothing is more of a buzzkill than listening to a Van Halen power track, and have the next track be some sappy love ballad, or one we don't like.
3. If we don't like the music, which is sometimes the case, since labels don't usually differentiate different versions of the same song by the same band on different albums, we're stuck with a $25 beer coaster.
4. Why the hell would we want to pony up $25 for the one or two songs we actually want to listen to?
I don't really understand why the RIAA is publicly saying that CDs should cost more. We feel ripped off even at $15 for a CD, let alone $35. Just saying that something should cost more than it actually does isn't gonna make people feel like thy are getting a bargain. Just because the price of diesel dropped from $3.20 a gallon doesn't make me feel thankful for having to pay $2.90 a gallon now.
So, why should I, or anyone else, feel thankful for being overcharged less that the RIAA says they *should* be charging? It's like someone telling you that you should be thankful for 9 spankings instead of 10. Either way, it still sucks. This is just a really bad attempt at making up want to stop pirating because we should be thankful that the are not charging us as much as they *should* be.
Knowing Google's lust for data collection, the Soviet Union is still alive and well inside the psyche of Sergey Brin....
How can I possibly pick up a DVD for $10 ?
The fact is, its all about greed. I think other slashdotters have already covered the whole scales of economy so I won't take it any further than that.
I can tell you now that I simply don't think a CD is worth $33. They only think its worth that much because its what they think they can get away with it.
I entirely agree with all of that. Record companies used to provide a valuable service by fronting the high costs of recording, copying, distributing, and promoting music. By the very nature of the business, they had to pick and choose between bands and decide which music would be heard. The entire model is obsolete. It's a broken paradigm for information distribution.
But I don't see how it's relevant to this discussion. We were talking about what the RIAA companies have done with the price of CD's. They're claiming they went down, based on invalid data. As you said, the up and coming model of internet distribution has so far, for the most part, been priced about the same as CD's, so it's not a form of competition driving the price down on CD's, yet. I don't see how similarly priced digital music distribution relates to an argument about whether the price of CD's has gone up or down. But you're right that the price of internet downloaded music should sooner or later fall off a cliff, as the studios, who currently get over $0.90 on the dollar of the money, become entirely excluded from the process.
Can anyone tell me how to set my sig on Slashdot?
An interesting anagram of "BANACH TARSKI" is "BANACH TARSKI BANACH TARSKI"
I just bought a rucksack for 50DKK (~ US$ 9). Seems OK. My new vacuum cleaner did cost 250 DKK (~ US$ 45). A new garden table set (table, bench and chairs) was 500 DKK (~ US$ 90).
I doubt I could have purchased any of these items for the same amount 20 years ago.
The rucksack and vacuum cleaner were made in China, the garden table set was made in Vietnam.
> this is a classic example of supply and demand.
No, it is only half the supply and demand model. The demand adjusts to the price, the supply does not. The supply and demand model describes an equilibrium price that would happen in a perfect market. Most recordings are covered by copyright, making their production state granted monopolies, which is as far from a perfect market as you can come.
Supply and demand can be used to model what happens with recordings whose copyright has expired.
The RIAA treats us like idiots (when it's not like criminals). CD stamping costs only cents in quantities of 10,000+; even in Australia it's only 99c each for a run of 10,000 including a jewel box (ref: www.cdroms.com.au)
Wrong. You only have a monopoly if there are no alternative products. Last time I looked the music industry was positively overflowing with different artists producing both similar and different styles of music.
If what you're referring to is a monopoly, then every single employee on the planet has both a monopoly of their labour, and on their production. Yet amazingly the labour market shows no signs of being a monopoly.
Everyone spewing about the cost of technology going down over the past 14 years is correct, the RIAA states that in the beginning of their article!
What they postulate is that all the non-technical/manufacturing costs have gone down, but the cost of advertising, recording, wages, etc. etc. has actually increased (these type of things will increase along with the CPI).
So in effect, the cost of making the CD has gone down. But the cost of making the CD successful by finding new artists, recording the music, advertising, etc. has gone UP!!!
I hate the RIAA, they are despicable. But you're not even reading the articles!
No - I'm not new here
What are they smoking?
Almost every newsagent and bookshop has a photocopier. Yet people don't commonly "pirate" books and newspapers. Why? Well, because it's cheaper to buy than to pirate. It's my reckoning that if CDs cost about £3.00 (€4.55 / $5.88) each, then it would not be worth most people's while to go to the effort of copying them. Nor would anyone think twice about buying a CD at that price. The record companies could easily afford to sell CDs at for £3.00 if they didn't spend so much pursuing failed copy-prevention schemes and paying fatcats to do nothing useful. And they'd probably sell enough units to be earning more than they were before. People would be more willing to take a gamble; if it turns out to be shite, it's not such a great loss.
Now I'm going to tell you a story. It's a sad story. About music, and greed, and the Perversity of Human Nature.
There was a bar I used to drink in once. They had a juke box in there. An NSM Prestige, played 45s, 160 selections. 10 pence a song, six for 50p., and it was always playing. Everyone who came into the place used to walk up to the machine, look at the records, drop in a coin and put on a tune.
Actually, the juke box wasn't always playing. For one hour a fortnight, it would be silent, while the man from the amusement machine hire company emptied the coin box, changed the records and cleaned and serviced the machine. And the bar was closed sometimes. But you get the general idea. It was a popular machine. It also played the records in the order they were arranged in the magazine, not the order in which they were selected (that way, it used only 20 bytes of RAM to store all its selections; which is important when your brain is a single-chip micro with just 64 bytes of RAM), and it was quite possible that you'd have to stay awhile to hear your track if there were a lot of selections from the other end of the machine to be played. That meant the bar sold more beer and food, since the Perversity of Human Nature is such that someone who has paid to hear a song will gladly spend a few pounds on refreshments rather than waste ten pence by leaving before the song comes around on the record machine.
All that changed one sunny afternoon. The man from the amusement hire company came round as usual; only this time, as well as merely emptying the coin box, changing the records, cleaning and servicing the machine, he also tweaked the price up to 20 pence a song.
After that, people just used to walk up to the machine, look at the records, and walk away again.
And the moral of the story, if you're really choking for this story to have a moral, is that if you charge too much then people won't pay it.
Je fume. Tu fumes. Nous fûmes!
The RIAA has a point but what they willfully ignore is that market forces have radically changed since the CD was introduced. Consumers today are literally overloaded when it comes to entertainment options. Hundreds of TV channels via satellite and cable, tons of movies playing in theaters, a huge collection of titles available on DVD, movies on demand, radio, satellite radio, the web, podcasts, video games and the list goes on and on.
So while the RIAA has a point that CD prices would be a lot more today if prices had kept up with the rate of inflation instead of staying relatively stagnant they fail to take into account the fact that the entertainment market has radically changed since the CD was first introduced. Consumers have a hell of a lot more entertainment options than they had even 5 to 10 years ago and CD prices need to reflect that reality.
I seem to recall about 5 years ago the RIAA lost a huge government case whereby the government insisted that CD prices (at the time averaging around $20 - $25) were out of line with actual cost. As I recall, the government won that case and CD prices fell to the current $13 - $18 range.
This seems to me a media ploy from the RIAA to "claim" that they have a just reason to raise the price of a CD back to the pre-lawsuit range.
Nevermind the fact that the production costs have plummeted.
Based on my rough calculations (rough = not really doing any research, just making a point), and using the same logic as the RIAA, microwaves should be retailing for about $4000, radios for well over $50,000 and a car should be in the millions.
If you've read the RIAA's argument, they are not arguing that the manufacturing costs have gone up. What they are arguing is the total cost has gone up. For them they are including things like marketing and labor costs which costs more today than in 1983. On the surface that seems like a reasonable argument but if you think about, it's BS.
Except for a few artists, most artists get the scraps left over after the record companies take their share. If anything the share for the artist has gone down in terms of absolute dollars as the record companies cry poverty.
I consider this the biggest lie. First of all, the record companies charge the artist for studio time if the artist uses their studios. This cost is not factored into their royalties. So if an artist has a contract stipulating he/she gets $1 an album, that does not include any studio costs yet. Some artists like TLC have claimed bankruptcy after high album sales because their studio costs exceeded their royalties. If the record companies say the price of the CD covers studio time then they are double dipping. Because of this reason and for more creative control, many artists build/use their own studios. For these artists, the studio cost to the record company is nothing because the studio costs are borne by the artist.
Yes marketing costs money but the subtext here is that the studios seem to admit the payola scheme.
Another case of double dipping. First, the tours are supported by ticket sales. Second, like studio time, concert tours are mostly funded by the artists themselves because they keep all the proceeds. There are tours funded by the record company but those are just another instrument to rip the artist off even more. The company makes more profit off them.
Taking the record companies argument, what is overlooked is not all CDs costs the same to the record company. Manufacturing costs might vary between 100K copies and 1 million but the difference is small comp
Well, there's spam egg sausage and spam, that's not got much spam in it.
"It costs less to manufacture a CD than it used to to make an LP ... so if that were true then CDs would cost LESS (inflation adjusted) than LPs did back then."
I'm surprised at how many people aren't aware that for lots and lots of things that are sold at retail, the manufacturing cost is a small percentage of the cost of sale. It's true for PC peripherals (the manufacturing cost for my products is about a third of the cost of sale), it's true for cars, it's true for clothing, and it's true for items in the grocery store. Selling hard goods via retail is inherently inefficient; there's inventory to manage, and everybody who touches it gets paid; these costs add up fast.
Either way, CDs do cost less than LPs did back then. I was buying LPs for $8 or $9 in 1983. $9 in 1983 = $17.50 in 2007 money, while the average price of a new CD is around $13 - $14. Did I misunderstand your point?
"The problem of course is that there's no real competition in the music publishing industry - you don't see competing companies trying to undersell each other with the latest say Rolling Stones CD - copyright laws essentially create monopolies."
Right, copyright is a monopoly. But supply and demand still apply. How well the latest Rolling Stones CD sells depends on how good it is, and the price at which it is sold. Nobody needs it and the higher the price, the more people will find that they can do something better with their money. If the Rolling Stones were, say, the only cure for pancreatic cancer, then your statement would apply quite well. But any given CD by any given band pretty much epitomizes the idea of discretionary spending.
Sitting in my day care, the art is decopainted.
It's a good time to be an indie artist, definitely.
I [may] disapprove of what you say, but I will defend to the death your right to say it.