UK Judge Rules That Selling Consumers Cheaper CDs Is Illegal
from the makes-sense dept
The story of CD-Wow, the second-biggest British online music retailer, has been dragging on for a while. In an effort to offer its customers cheaper CDs, it began importing them from Asia, where they're cheaper, then selling them to consumers in the UK. As this pretty effectively got around record labels' efforts to artificially inflate CD prices there, the BPI got upset and forced the company to stop selling the discs without its consent, resulting in a 2-pound price increase. The BPI then got even more upset when CD-Wow went around explaining how the BPI's actions forced them to increase prices. Now, CD-Wow has been hit by a judge with fines as high as 4 pounds per CD for selling the imports, after legal action from the BPI and several labels. Just to be clear: CD-Wow was selling legitimate discs, not pirated copies. They'd simply found a cheaper supplier in another part of the world, and passed the lower costs onto consumers. The labels argue this is somehow a violation of their copyright, but it seems much more like a handy bit of protectionism. Many music buyers are familiar with "import" CDs that often feature different or additional material from releases in their own country, and record labels don't really seem to have a problem with American buyers shelling out $30 for a Japanese version of a CD, or $12 for a UK import single. But when imports come at a lower price, then it's a problem. CD sales are falling, a sign that consumers don't see enough value in them at current prices. So rather than lowering prices (or improving the product) to correct that imbalance, the labels would rather keep prices inflated and hold back sales. With decisions like that, it's little wonder these companies are struggling.