Must a CD Cost $15.99?

scionite0 sends us to Rolling Stone for an in-depth article on Wal-Mart and the music business. Wal-Mart is the largest music retailer selling "an estimated one out of every five major-label albums" in the US. Wal-Mart willingly loses money selling CDs for less than $10 in order to draw customers into the store, but they are tired of taking a loss on CDs. The mega-retailer is telling the major record labels to lower the price of CDs or risk losing retail space to DVDs and video games. (Scroll to the bottom of the article for a breakdown of where exactly the money goes on a $15.99 album sale.) "[A Wal-Mart spokesman said:] 'The record industry needs to refine their business models, because the consumer is the ultimate arbitrator. And the consumer feels music isn't properly priced.' [While music executives are quoted:] 'While Wal-Mart represents nearly twenty percent of major-label music sales, music represents only about two percent of Wal-Mart's total sales. If they got out of selling music, it would mean nothing to them. This keeps me awake at night.' [And another:] 'Wal-Mart has no long-term care for an individual artist or marketing plan, unlike the specialty stores, which were a real business partner. At Wal-Mart, we're a commodity and have to fight for shelf space like Colgate fights for shelf space.'"

Comments

Wait

[Anonymous Coward]

I thought all you guys stole all your music.

Re:Wait

[Anonymous Coward]

As I said, if a bunch of kids in their basement can do it, why can't the professionals?

Dont you know how much it costs to have a private jet, custom 3 bus caravan (with one bus just for the prima-donna lead guitarists' guitar collection) let alone the amount of money needed to keep the drummers coke addiction fueled? The Bassist's alcohol problem it's self costs $7500.00 a show and that does not count bribing him out of jail after every gig.

Being a REAL band is expensive. It costs at least $45,000 a month just to keep the drugs and booze flowing. The skanky hooker expense is close to that unless you are a screamo band, then you get away with $60.00 a night. (those guys like dirty ho's!

It costs at least $100,000 a month to take care of the artists and keep them artistic. Many bands like Metallica need another $1.2mil monthly just to think about creating, or at least re-recording their old junk so they dont sound like complete tools on stage when they cant remember the words to "sandman"

(Yes I am bitter that the lazy assholes dont even try anymore at the $250.00 a ticket raping prices)

Re:Wait

[Anonymous Coward]

Being a REAL band is expensive. It costs at least $45,000 a month just to keep the drugs and booze flowing. The skanky hooker expense is close to that unless you are a screamo band, then you get away with $60.00 a night. (those guys like dirty ho's!

Any "real" band has enough hot groupies to go around. No skanky hookers required.

Re:2004?

[night_flyer]

Take it easy on him... he's a slow reader

Re:2004?

[peipas]

Hardly news considering the article was posted on Oct 12th, 2004!

Who the hell approved this? There's more. It's a dupe. Wow.

Re:2004?

[Anonymous Coward]

Lets do the time warp again!!!

Re:Proposed new budget

[nospam007]

$1.60 Artists' royalties - mega artists can get skimpier - down to $1 a CD even

Are you mad? Do you have any idea what castles in England costs these days?
Madonna

Re:2004?

[Anonymous Coward]

kdawson can read?

Re:The Empire vs the Borg

[Z34107]

Vlasic was, for lack of a better word, stupid in their dealings with Wal-Mart.

IIRC from an article I read a few years ago, they agreed to sell industrial-sized jars of pickles to Wal-Mart. For (figurative) peanuts, a few bucks a piece. They were making a loss on every picke sold.

Why'd they still go through with it even though they were taking a loss? 'Cuz they were selling a lot of them!