MPAA & RIAA: If People Can Sell Foreign Purchased Content Without Paying Us Again, US Economy May Collapse

from the a-bit-of-an-exaggeration dept

We've written a few times about the upcoming Kirtsaeng case before the Supreme Court concerning first sale rights. If you don't recall, the 2nd Circuit appears to have wiped out the first sale doctrine for content purchased outside the country that you want to resell within the US. As we noted, there are significant worries about how such a ruling could really harm innovation. At issue was a guy who bought textbooks abroad and resold them in the US (for less than the cover price that the publishers wanted students to buy). The courts basically found that because the textbooks were made outside the US, they weren't "lawfully made under this title," which is some clumsy phrasing that's at issue here.

Of course, thanks to our copyright maximalism, under Kirtsaeng, if a product is made outside the US and then imported, US copyright law appears to apply to almost everything that's copyrightable... except that first sale rights go away. If that seems dangerous, you get a sense of how important the Supreme Court's ruling in Kirtsaeng can be, hopefully by bringing back some sanity, and showing that if you legally purchase some digital content you have the right to resell it.

It appears that the RIAA and MPAA are pretty scared about this possibility. They've filed quite the amicus brief in the case claiming that buying goods overseas and selling them in the US is the equivalent of piracy. No joke:
Copyright protection is essential to the health of the motion picture and music industries and the U.S. economy as a whole. Like the sale of “pirated” copies, unauthorized importation of copies of protected works made overseas and intended only for sale in a foreign market can undercut or eliminate the economic benefit that Congress intended to provide under the Copyright Act.
Oh, and it gets worse. You see, if that darned first sale is allowed on foreign goods, why (*gasp*) the MPAA and RIAA might actually have to deal with people buying goods in one market and selling them elsewhere. Horrors!
Extending the first sale doctrine to copies made abroad for distribution in a foreign market could impede authors’ ability to control entry into distinct markets, limit their flexibility to adapt to market conditions, or undermine territorial licensing agreements. If accepted, Kirtsaeng’s view of the first sale doctrine could thus prevent U.S. copyright holders from obtaining the economic reward Congress intended to provide under U.S. law to motivate investment in creative activity.
Now that's an interesting interpretation of copyright law. The RIAA and MPAA are arguing that if they can't block people from importing the versions they sell overseas, it will somehow motivate less investment in creative activity. Really?

Here's the real problem: the RIAA and MPAA want to have their cake and eat it too. If products bought abroad and then imported into the US don't get first sale rights, then it seems only reasonable that they shouldn't get US copyright protection either. Part of the deal with copyright protection in the US is that as part of it, you accept that buyers have first sale rights that allow them to resell what they legally purchased. What the RIAA and MPAA are attempting to do here is to take away the public's right to resell what they've legally purchased, because it might interfere with one aspect of their preferred business model.

Of course, what this really comes down to is that the RIAA and MPAA absolutely hate the idea that they might have to compete in a global market. They more or less admit this in the brief, suggesting that prices are cheaper elsewhere in the world because copyright law sucks in other places... and allowing cheap goods into the US means that they don't get the "separate benefit" of expansive US copyright law:
When copyright owners distribute tangible copies of creative works in a foreign market, they recoup the economic benefit made possible by the copyright law of that country, which may be substantially less generous or well enforced than U.S. copyright law. They do not realize the separate benefit Congress intended them to derive from their U.S. copyright. If those copies are imported into the United States without permission, the copyright owner might never obtain that full benefit.
Boohoo. You sell into one market, people buy, they sell into a different market. Every other business in the world has to deal with exactly that. Why should the RIAA/MPAA get special treatment?

Oh, and of course, they rush to play up how much "harm" this would do if they can't overprice content in the US (what this is really about) by trotting out the same debunked stats about just how important they are -- even to the point of suggesting that allowing people to resell goods they legally bought elsewhere would have deleterious consequences for the entire US economy.
Those harms, in turn, could have deleterious consequences for the U.S. economy as a whole. As of 2010, the motion picture and television industry supported 2.1 million jobs and nearly $143 billion in total wages in the United States.... In addition to the major motion picture studios, the industry supports a nationwide network of nearly 95,000 businesses throughout the 50 States. Id. The music industry employed over 25,000 paid employees as of 2004.... The industry supports many smaller businesses such as retail stores, distribution companies, recording studios, and music professionals. The retail trade alone generates over $7 billion from the sale of sound recordings... Maintaining robust copyright protection is thus crucial to preserving not only the health of these creative fields themselves, but also their substantial contributions to the national economy.
That the actual evidence suggests something quite different is, of course, not mentioned. That the overall music and movie industries have been growing quite nicely, even as copyright is more and more ignored, is not mentioned. That more content is being produced and more money is being made... is not mentioned. Inconvenient facts are not allowed.

The filing at one point gets so snarky that it claims that those arguing the other side are using the word "arbitrage" as a euphemism (for what?!), rather than as an accurate description of what happens to normal economies that can't set up protectionist tariffs on importation of goods.

The whole thing shows the same myopic thinking of the RIAA and MPAA -- that anything that threatens their chosen obsolete business model simply must be illegal. Because having the courts and Congress prop up old business models must be better than actually innovating and (*gasp*) letting people resell what they legally bought.


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    weneedhelp (profile), Sep 20th, 2012 @ 9:58am

    Angry

    I am so sick and fucking tired of this cartel crying about the wolf that never materializes as the make money hand over fist.

    Do they really still wonder why no one gives a fuck about them? Why they get no respect from the public?

    They are the epitome of the boy who cried wolf. I wish the wolf would materialize and fucking eat their hearts out.

     

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      Anonymous Coward, Sep 20th, 2012 @ 11:28am

      Re: Angry

      AMEN! You took the words right out of my mouth! Fuck these retardS!!!

      Real Ignorant Assholes of America! RIAA

       

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    Snow, Sep 20th, 2012 @ 9:59am

    this should be the wiley case

    Setting aside legal tradition, I think this should be called the Wiley case. It's what they're fighting for, it's who'll be around afterwards, and it's a stain their otherwise good name should bear.

     

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    Anonymous Coward, Sep 20th, 2012 @ 9:59am

    Mike, this is another case where I seriously wonder what you were doing while you were at school, because you clearly didn't get much of what was going on.

    You have to pay attention and THINK for a minute. The real issue here is that the economy of each country is not the same. A CD that sells for $10 in the US might only sell for a fraction of that in another country. In order to stay competitive in that country, they have to price at maybe $2. The local distributor licenses from them at a price in consequence of that $2 retail price.

    The knock on effect of allowing the product to be brought in from the lowest retail price country and resold in the highest is to have all of the income taken away from the labels, except for whatever the lowest world price is currently.

    You think "good for them, maybe they will lower the price". But really, what may happen is that the labels may no longer want to sell in the poorer countries, or may only sell at prices that nobody locally can afford, just to avoid hurting their bigger income countries.

    The effects are negative, no matter how you look at it.

    Also, you should know the effects that happen when goods are not priced realistically for the market. Very quickly, the goods cannot be produced (or sold) in the higher wage countries, because they cannot afford to make or distribute them. It's not like anyone is making 50-75% margin on things, they cannot afford to take the hit.

    The whole story just really points out how unrealistic your views are, and how much you don't seem to be considering the full on implications of such actions.

     

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      Tim K (profile), Sep 20th, 2012 @ 10:03am

      Re:

      It's not like anyone is making 50-75% margin on things, they cannot afford to take the hit.

      If by anyone you mean the artists you're correct, if by anyone you are referring to the overpaid people at the *AA's then your are not so correct. Also, if they spent less money buying legislation, they'd have plenty of extra money. Also, if they removed low prices from areas that would do nothing other than drive up piracy. And decrease sales

       

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      Jason, Sep 20th, 2012 @ 10:09am

      Re:

      Thanks for explaining how commerce works in every other industry that isn't Copyright based.

      If the middlemen in certain industries (like clothing, or say food) were critiqued under this new interpretation of the law, it would cause catastrophic harm to the economy.

      Imagine the grocery store not having the right to resell fruits and vegetables that they purchased in another country. That's just plain ridiculously stupid. And the RIAA/MPAA arguments in this case are just as stupid.

       

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        Anonymous Coward, Sep 20th, 2012 @ 3:26pm

        Re: Re:

        There *are* strict laws about the importation and reselling of food in this country, Einstein.

        As for the nonsense in the article, it's just more boilerplate RIAA bashing; Masnick throwing some red meat to his pirate audience.

        This blog has become so silly that I rarely visit it anymore, but whenever I do, it never fails to supply ample intellectual dishonesty and outright stupidity.

         

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      Ninja (profile), Sep 20th, 2012 @ 10:12am

      Re:

      It happens in Brazil. A digital camera here costs at least 200% of the price in the US. Computers can reach 400%. And I'm considering the currency, it used to be more when the dollar lost its value here. How do you deal with that?

      Well, there are all sorts of ways. One of them is to charge an imports tax and it works pretty nicely (not that I agree with it mind you but it's what they do). The first sale doctrine doesn't apply to major imports, it applies to what the ordinary Jon Doe buys overseas. And it's a pretty small amount of goods simply because there's a limit to how much value you get into the country without paying taxes so the amount of goods the average person can resell is very limited.

      And it's amusing when you put it like that when the great majority of MAFIAA's goods is made in China.

      You criticize Mike but it seems you were the one that hasn't paid much attention to your classes.

       

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        Anonymous Coward, Sep 20th, 2012 @ 10:32am

        Re: Re:

        And it's amusing when you put it like that when the great majority of MAFIAA's goods is made in China.

        That is misleading at best. It is the content itself that has the greatest value. That content is almost never produced in China.

         

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          Anonymous Coward, Sep 20th, 2012 @ 10:37am

          Re: Re: Re:

          The content is NOT produced by the MAFIAA.

           

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            KingofDarkness, Sep 20th, 2012 @ 10:44am

            Re: Re: Re: Re:

            That was the exact response in my head as I read that comment, then I scroll down a bit more and you posted it :)

            Kudos to the rational

             

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          Anonymous Coward, Sep 20th, 2012 @ 10:43am

          Re: Re: Re:

          Yes, but once the content is produced then it is infinitely and cheaply able to be reproduced. The production of the content has a set fixed cost. Which is itself irrelevant to the end consumers.

          I don't care how much it cost to make. I care about what I'm paying for it.

          And if your cost are so much that you CANNOT make a profit EVER, even after selling a product globally, then you have a problem. And it's not pirates or consumers reselling their legally purchased goods (used or new).

          What's misleading is saying basically saying, "People selling used goods that they got elsewhere is going to kill the motion picture and music industry. And will definitely kill the U.S. economy. Proof? No, don't worry about proof, just take my word for it."

          I'm still waiting for piracy to kill the music industry. Somehow, it's 2012. Wasn't it supposed to die in 1999 with the advent of Napster? It's still here? THE HELL YOU SAY?!

           

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            Anonymous Coward, Sep 20th, 2012 @ 3:50pm

            Re: Re: Re: Re:

            I don't care how much it cost to make.

            And I don't give a flying fuck that you choose be willfully ignorant about the reality of economics.

            Just don't infringe my rights.

            I'm still waiting for piracy to kill the music industry. Somehow, it's 2012. Wasn't it supposed to die in 1999 with the advent of Napster? It's still here?

            It is still here, with its revenue cut in half.

            Napster however, isn't here anymore.

            Once again:

            I don't give a flying fuck that you choose be willfully ignorant about the reality of economics.

            Just don't infringe my rights.

            And just to make sure you don't, how about you do the world a favor and go die in a fire.

            Thanks.

             

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              Anonymous Coward, Sep 20th, 2012 @ 4:03pm

              Re: Re: Re: Re: Re:

              You know, rights work both ways.

               

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              Cory of PC (profile), Sep 20th, 2012 @ 6:09pm

              Re: Re: Re: Re: Re:

              ... You're that same AC that told me to go die in a fire like a Buddhist monk, right?

              If you are, then OK, I'm glad that you're providing something to this conversation! Mind telling us what you do for a willing and what you make so that way we can avoid you like the plague?

               

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              Anonymous Coward, Sep 20th, 2012 @ 11:08pm

              Re: Re: Re: Re: Re:

              Stop conflating the music industry with the recording industry. The music industry is doing just fine, thank you.

               

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              JEIDIDIAH, Sep 21st, 2012 @ 1:05pm

              Protect me because I am a cry baby!

              > And I don't give a flying fuck that you choose be willfully ignorant about the reality of economics.

              As a consumer, it's simply not my problem.

              It's YOUR problem as a Robber Baron wannabe. Business is hard. Perhaps you should leave it to the people that can handle it.

              Destroying my property rights because you can't handle the business environment is simply unacceptable.

               

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                Anonymous Coward, Sep 21st, 2012 @ 1:08pm

                Re: Protect me because I am a cry baby!

                it is acceptable

                its happening in france, the uk, and soon the us

                enjoy :D

                 

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          Chosen Reject (profile), Sep 20th, 2012 @ 10:45am

          Re: Re: Re:

          It's not misleading when you consider the case at hand. The case is that a copyrighted work made outside the US is not "lawfully made under this title", therefore the right of first-sale does not apply. The issue at hand has nothing to do with where the ethereal copyrighted work was written, recorded, conceived, etc, but where the physical container (CD, DVD, paper book, etc) of that copyrighted work was manufactured.

          In the case at hand, most likely the textbooks were written here in the US (I couldn't find a reference to a specific textbook in my cursory search, so I can't verify this, but it is very likely to be true), but then manufactured outside the US. So Ninja's point is very relevant. It's where the physical manifestation of the copyrighted work is made that is relevant to this case, not where the original copyrighted work was written, recorded, etc.

           

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            Anonymous Coward, Sep 20th, 2012 @ 10:49am

            Re: Re: Re: Re:

            "In the case at hand, most likely the textbooks were written here in the US (I couldn't find a reference to a specific textbook in my cursory search, so I can't verify this, but it is very likely to be true), but then manufactured outside the US. So Ninja's point is very relevant. It's where the physical manifestation of the copyrighted work is made that is relevant to this case, not where the original copyrighted work was written, recorded, etc."

            Hey! Hey! Chosen Reject you behave! You leave that poor AC alone! Wtf does where the textbooks where manufactured have to do with his argument?! Huh? Can't you see he's trying to make a point to dismiss Mike's article and the rest of our comments!

            I'm sorry but I'm calling bully on your comment! Relevant facts? I think not mister! You can take what is relevant to the court case and the article in hand and begone with it!

            : )

             

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          The eejit (profile), Sep 20th, 2012 @ 11:20am

          Re: Re: Re:

          Okay then, let's put it this way:

          0% of the content is directly produced by the MAFIAA. That's right, they produce nothing of economic value whatsoever. It is their members that "produce" the content, not them.

           

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          Ninja (profile), Sep 20th, 2012 @ 11:44am

          Re: Re: Re:

          That is misleading at best. It is the content itself that has the greatest value. That content is almost never produced in China.

          Meaning you can place the same value anywhere so there won't be such issues. So your point crumbles down.

           

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            Anonymous Coward, Sep 20th, 2012 @ 5:46pm

            Re: Re: Re: Re:

            Ninja, no. Wrong.

            The point is that the content is generally created in higher wage countries, it is produced, edited, and otherwise generated in higher wage countries. The mere act of reproduction isn't the big end of the stick here.

            See, you are falling for Mike's standard logic: ignore what it costs to create the product to start with, assuming someone else actually paid for it, and then concentrate only on the costs to reproduce the physical delivery, without considering what is being delivered.

            In the real world. people get paid to make what is on the CD or what had been sold digitally. The writers of books have been paid, the editors paid... and on down the line. That money has to come back somehow.

            What you are ignoring is that if product is allowed to flow from the lowest retail cost location to be sold in the highest retail cost location, the price overall will be driven down, to the point where nobody is paying the costs of making the content. At that point, producing it is a meaningless business exercise - it's a loss.

            So what happens? Either they stop selling the product in the lowest price countries (why allow the market to get flooded with cheap imports), they raise the price in those countries the point that nobody can afford to buy it, or they stop making content entirely.

            Mike knows this stuff. You only have to look at the erosion of the industrial base in the US to understand: Lower wage countries are willing to do the work and ship stuff to the US, and they can do it cheaper than Americans can. The result? The rust belt, the empty factories, and every job including phone support being offshored.

            It's not fun to watch the results.

             

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              Anonymous Coward, Sep 21st, 2012 @ 2:22am

              Re: Re: Re: Re: Re:

              Well produce it china then you moron.

               

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              Ninja (profile), Sep 21st, 2012 @ 3:29am

              Re: Re: Re: Re: Re:

              ignore what it costs to create the product to start with, assuming someone else actually paid for it, and then concentrate only on the costs to reproduce the physical delivery, without considering what is being delivered

              We, the consumers, couldn't care less about your costs. There are movies made with less than $10k that earned millions. With $8k I can build a small studio at home and record as many songs as I want, it's not rocket science. Maybe if you didn't pay shitloads to your ceos the profits would be higher ;)
              And as I noted in other comments we are talking about the first sale doctrine, not some massive large scale scheme.

              That money has to come back somehow.

              It's amusing how you simply ignore models that would bring a lot of money in ;) You see, the artists and the fans don't care how the middleman makes their money. Live with that.

              At that point, producing it is a meaningless business exercise - it's a loss.


              Then please go ahead and go out of business already, we'll be happy, won't shed a tear and won't miss you. While I don't doubt that the middlemen might be taking losses the music sector is thriving. Nobody cried when the ice cutters or the buggy whip sellers went out of business. Except for the ones in the business themselves.

              So what happens? Either they stop selling the product in the lowest price countries (why allow the market to get flooded with cheap imports), they raise the price in those countries the point that nobody can afford to buy it, or they stop making content entirely.

              Oh please, by all means stop selling, we'll have content in spite of you. And stop making content, we don't care either, there are plenty of good people out there doing content and not being morons like the MAFIAA.

              You only have to look at the erosion of the industrial base in the US to understand: Lower wage countries are willing to do the work and ship stuff to the US, and they can do it cheaper than Americans can. The result? The rust belt, the empty factories, and every job including phone support being offshored.

              Now that indeed is an issue for physical, scarce goods. I for one know that the textile industry in the US is pretty much loitered (unused) and yet they produce much better quality stuff. It's an issue in Brazil too. However it is NOT an issue in the music/movies/games industry. If you want to sell a lot, stop suing your costumers and start offering decent prices so you'll get your money returned in the quantity of sales, not the individual amount.

              Indeed, it's not fun to see what the crappy Chinese goods are doing to the economy as a whole. But the MAFIAA has absolutely NOTHING to do with it or you too can outsource the production to the Chinese. And again it's good to point that we are talking about the first sale doctrine, that applies to goods bought for PERSONAL consumption. So this discussion is meaningless, there's no issue here at all.

               

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                Anonymous Coward, Sep 21st, 2012 @ 4:13am

                Re: Re: Re: Re: Re: Re:

                "We, the consumers, couldn't care less about your costs"

                Don't be a tard. I notice you sucking up to Mike looking for a job posting, I guess. Please stop already.

                Seriously, if you don't want to discuss the economics and choose just to make vague disparaging remarks about the various evil-doers that you see, it's sort of pointless to try.

                It is really a basic economic issue. I guess it's just beyond your simple minded thinking.

                 

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                  art guerrilla (profile), Sep 21st, 2012 @ 9:58am

                  Re: Re: Re: Re: Re: Re: Re:

                  1. NO, ninja -and all of techdirtia- is right: we don't give a SHIT what something -ANYTHING- costs the producer...
                  (and -in your few-and-far-between moments of humanity- YOU don't either...)

                  NO ONE goes shopping and compares whether they should get a widget from Brand A or Brand X based on whether Brand A or Brand X has lower/higher production costs... *that* is insane...

                  we shop on features, price, and convenience...
                  besides the fact that all the other information regarding their production costs is simply not available, NO ONE gives that crap a second thought...

                  (NOT that i would trust your average korporation to give honest numbers regarding their production costs, anyway...)

                  IF i spot a great price on a widget i want/need, i don't start wringing my hands and hoping the producers have low enough production costs to make sufficient profit; NO ONE does that for ANY products/services...

                  (IN FACT, that is prezactly how the -mythical- free market economy *should* work: you price your widgets too low, you go out of bidness, and another competitor steps up to replace you...)

                  2. you are a thoroughly disagreeable character; chances are you're a lawyer, amirite ? ? ?
                  dog damn, i can't wait for the revolution, you fuckers will be the first invited to the necktie party...

                  it really astounds me how you think insulting EVERYONE is going to win friends and influence people on these issues you supposedly care about...
                  (i'm thinking the only reason you 'care' about these issues, is because you are -directly or indirectly- paid to do so...)

                  oh, and for the record, i have NEVER pirated ANYTHING; BUT, i have stopped buying ANY music, movies, etc that are a product of the MAFIAA, because i despise them...

                  BUT, because of unrepentant MAFIAA apologists like you, i am seriously toying with going FULL PIRATE...

                  don't you get it, YET ? ? ?
                  it is not pirate king mike the torrent freak who is pushing me to full blown piracy, it is YOU AND YOUR FIENDS at the MAFIAA who are turning me pirate...
                  none so blind...

                  art guerrilla
                  aka ann archy
                  eof

                   

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                    Anonymous Coward, Sep 21st, 2012 @ 1:44pm

                    Re: Re: Re: Re: Re: Re: Re: Re:

                    Gorilla-

                    I usually don't engage in debate with such obvious wackjobs, but yourambling fit of pique is so delicious, I can't resist.


                    1. NO, ninja -and all of techdirtia- is right: we don't give a SHIT what something -ANYTHING- costs the producer...
                    (and -in your few-and-far-between moments of humanity- YOU don't either...)

                    NO ONE goes shopping and compares whether they should get a widget from Brand A or Brand X based on whether Brand A or Brand X has lower/higher production costs... *that* is insane...

                    we shop on features, price, and convenience...
                    besides the fact that all the other information regarding their production costs is simply not available, NO ONE gives that crap a second thought...

                    (NOT that i would trust your average korporation to give honest numbers regarding their production costs, anyway...)

                    IF i spot a great price on a widget i want/need, i don't start wringing my hands and hoping the producers have low enough production costs to make sufficient profit; NO ONE does that for ANY products/services...

                    (IN FACT, that is prezactly how the -mythical- free market economy *should* work: you price your widgets too low, you go out of bidness, and another competitor steps up to replace you...)


                    Lots of ground to cover here. A producer's cost in but one of a myriad of factors affecting price. But affect the price it will. Masnick and his merry band of sycophants, suck ups and nincompoops continually ignore the role of fixed cost in their many screeds against legacy industries. The free market fact of life is that these costs have to be covered in order reward companies and incent them to continue to invest their capital in this market segment. Piracy has the same affect, as you so eloquently put it: "you price your widgets too low, you go out of bidness..."

                    2. you are a thoroughly disagreeable character; chances are you're a lawyer, amirite ? ? ?
                    dog damn, i can't wait for the revolution, you fuckers will be the first invited to the necktie party...


                    I think you'd find me disagreeable no matter what degree I had. And good luck with your "revolution". I've seen the glassy-eyed stoners; unhygienic hippie chicks; effeminate, Communist pseudo-intellectuals; bums and other rabble on the cutting edge of your "movement". Quite frankly, it looks more like a bowel movement to me. So let me know when to expect to hear from the dictatorship of the proletariat. Until then, I'll be here laughing at you.

                    it really astounds me how you think insulting EVERYONE is going to win friends and influence people on these issues you supposedly care about...
                    (i'm thinking the only reason you 'care' about these issues, is because you are -directly or indirectly- paid to do so...)


                    I do care about these issues. But most (not all) of the Techdirtbags are drones. Usually failed creators or professional malcontents who revel in shouting into the TD echo chamber and content with the validation of their fellow zealots and the occasional pat on the head from the Lord High Piracy Apologist.

                    oh, and for the record, i have NEVER pirated ANYTHING; BUT, i have stopped buying ANY music, movies, etc that are a product of the MAFIAA, because i despise them...

                    More likely is that you're homeless or live in some sort of flophouse without electricity, etc.

                    BUT, because of unrepentant MAFIAA apologists like you, i am seriously toying with going FULL PIRATE...

                    Who cares? from the sound of things you're headed for prison, a shelter or rehab before long anyway.

                    don't you get it, YET ? ? ?
                    it is not pirate king mike the torrent freak who is pushing me to full blown piracy, it is YOU AND YOUR FIENDS at the MAFIAA who are turning me pirate...
                    none so blind...


                    Right. Blame the people you steal from. I must say you have the whole victim thing down pretty well. Maybe instead of taking other people's stuff you could get a library card or simply do without.

                    Have a good weekend Gorilla.

                     

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                      RadialSkid (profile), Sep 21st, 2012 @ 7:26pm

                      Re: Re: Re: Re: Re: Re: Re: Re: Re:

                      Lots of ground to cover here. A producer's cost in but one of a myriad of factors affecting price. But affect the price it will.

                      For the millionth time, consumers don't give a flying fuck about your sunk costs, nor should they. If you can't figure out how to produce/market/distribute something and market it a price that consumers like and you find profitable, that's your problem and your problem alone. Nobody owes you a living.

                      And good luck with your "revolution". I've seen the glassy-eyed stoners; unhygienic hippie chicks; effeminate, Communist pseudo-intellectuals; bums and other rabble on the cutting edge of your "movement". Quite frankly, it looks more like a bowel movement to me. So let me know when to expect to hear from the dictatorship of the proletariat.

                      This isn't 1971 anymore, Mr. Bunker, and the people you fight are pretty damn far from a fringe. More like a tenth of the world population.

                      Until then, I'll be here laughing at you.

                      Then you'll fight him. Then you'll lose to him. That's the order you will eventually become educated in.

                      Maybe instead of taking other people's stuff you could get a library card or simply do without.

                      What part of "I have never pirated anything" is your goofy ass having trouble with? Guy like art guerilla (and myself, for that matter) are your worst nightmare. We're the people who actually do without your so-called "art," and still fight you tooth and nail every step of the way. You have no leverage against us, but we can burn you to the fucking ground. Nice to meet you.

                       

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                        Anonymous Coward, Sep 22nd, 2012 @ 6:16am

                        Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                        Guy like art guerilla (and myself, for that matter) are your worst nightmare. We're the people who actually do without your so-called "art," and still fight you tooth and nail every step of the way.

                        So you fight tooth and nail against something you have no stake in and has no meaning in your life? Interesting, why?

                        You have no leverage against us, but we can burn you to the fucking ground.

                        I don't care about you and can see no point in "leveraging" you for any purpose. And as someone so totally removed as you, it's hard to understand what interest you have in burning me to the ground. I really don't even know what your gibberish means.

                        Nice to meet you.

                        If afraid I can't say the same.

                         

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                          RadialSkid (profile), Sep 22nd, 2012 @ 8:34am

                          Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                          So you fight tooth and nail against something you have no stake in and has no meaning in your life? Interesting, why?

                          The content or industry that produces it have no real meaning to me. Trouble is, the industry's little decade-long hissy fit has rammifications that go well beyond access to its content.

                          Your industry has waged war against the public domain, which is where much of the art I enjoy comes from. Your industry has waged war with Creative Commons, which where pretty much the rest of the art I enjoy comes from. Your industry has pressured the government into DNS blocking websites that frequently aren't guilty of copyright infringement, has pressured foreign governments into big publicity, SWAT-style raids on foreign businesses that they apparently have no real case against (read: Megaupload), and has even declared the Internet Archive a "rogue website." And many of us - myself included - have been personally threatened just for taking contrary positions to the industry stance on the subject.

                          The trouble with your crowd is, you automatically think anyone who opposes your maximalism in any way is a "pirate." This is why the widespread opposition to SOPA blindsided you. You just keep going on and on about your alleged "rights," and "stealing," and "entitlement," when in reality most of us have moved past that a long time ago.

                           

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                            Anonymous Coward, Sep 22nd, 2012 @ 4:31pm

                            Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                            Your industry has waged war against the public domain, which is where much of the art I enjoy comes from.

                            Meaning that it came from the industry to begin with?

                            Your industry has waged war with Creative Commons, which where pretty much the rest of the art I enjoy comes from.

                            Not doubting you, but can I get an example?

                            Your industry has pressured the government into DNS blocking websites that frequently aren't guilty of copyright infringement,

                            Are you talking about the SOPA proposals that were withdrawn by the authoras of the bill, or something else?

                            has pressured foreign governments into big publicity, SWAT-style raids on foreign businesses that they apparently have no real case against (read: Megaupload),

                            That is utter speculation.

                            and has even declared the Internet Archive a "rogue website."

                            Why, because they were are resource for infringing content? Big surprise.

                            And many of us - myself included - have been personally threatened just for taking contrary positions to the industry stance on the subject.

                            Threatened? By who? What were the circumstances? If you're talking about internet idiots threatening to kick your ass- that doesn't count. That's theatrics.

                             

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                              RadialSkid (profile), Sep 23rd, 2012 @ 3:39am

                              Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                              Meaning that it came from the industry to begin with?

                              Much of it, yes. Once it's in the public domain, however, it's no longer "tainted."

                              Not doubting you, but can I get an example?

                              Jamendo, Vodo, Magnatune are my major sources, and a few specific examples are Josh Woodward, Singleton, Tryad, and Pioneer One.

                              Are you talking about the SOPA proposals that were withdrawn by the authoras of the bill, or something else?

                              I'm talking about "This website has been seized by the authority of ICE, and your IP has been logged." I probably should have said "rerouting" instead of "blocking," but eh, semantics.

                              Why, because they were are resource for infringing content? Big surprise.

                              Infringing? I know of nothing "infringing" on the Internet Archive. They're primarily a source of public domain material.

                              Threatened? By who? What were the circumstances?

                              A certain country music writer, who will remain nameless, since I don't want to start it all over again (and I also can't prove it was specifically him). It involved him getting my phone number and leaving threatening voice mails at my home.

                               

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                Anonymous Coward, Sep 21st, 2012 @ 5:35am

                Re: Re: Re: Re: Re: Re:

                And again it's good to point that we are talking about the first sale doctrine, that applies to goods bought for PERSONAL consumption. So this discussion is meaningless, there's no issue here at all.

                You seem to be having a different discussion that everyone here talking about the Kirtsaeng case. This was a case of textbook arbitrage. Kirtsaeng was bringing in texts from low price foreign markets and selling in to the high price US market.

                It is fine if you want to have a discussion about the propriety of someone buying a book at the airport in Bankok and selling it at a used bookstore in the US after they finished reading it on the flight home. I doubt anyone would quibble over that nor waste any time talking to you about it. BUT THAT IS NOT THE DISCUSSION HERE.

                If you are interested in discussing the Kirtsaeng case, go read up on it. I will happily stipulate that the law should be enable you to sell the paperback you read on the plane when you get back to the US.

                 

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        Anonymous Coward, Sep 20th, 2012 @ 10:36am

        Re: Re:

        Ninja, why do you see prices like that? It's not because the producers are greedy, it's because your government is greedy.

        Think of it as an unfair subsidy to your local producers, who shouldn't need it - you live in a relatively low wage country.

        "And it's amusing when you put it like that when the great majority of MAFIAA's goods is made in China."

        I don't know of any band or any major label current recording in China to save money. Production of the CD / DVD is the very small end of things.

         

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          Ninja (profile), Sep 21st, 2012 @ 3:33am

          Re: Re: Re:

          Brazilian problem is excess bureaucracy and lunatic tax system. It's not greed but rather Governmental inefficiency. And I never blamed the producers, I was just saying that it's MUCH cheaper to buy in the US and sell here. However you can't because you'd have to go through mechanisms that prevent it. If I bought something for personal use in the US and sold here it's ok though. Because it's one unit, at most two. Missing the point much?

          I don't know of any band or any major label current recording in China to save money. Production of the CD / DVD is the very small end of things.

          That. Precisely why you can sell for lower to reach more people, you don't rely on scarce goods.

           

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        Anonymous Coward, Sep 20th, 2012 @ 11:08am

        Re: Re:

        Actually prices in Hong Kong, China are about on par with US for music and movies. Hop across the China sea to Japan, and they are about double US prices.
        PS I feel for you in Brazil, considering I deal with the same issues travelling to the East.

         

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          Anonymous Coward, Sep 21st, 2012 @ 2:25am

          Re: Re: Re:

          It happens all the time in the UK.

          Prices for technology seem to be converted from dollars to pounds by just changing the symbol in front of the number and not looking at the exchange rate, we used to end up paying double the price in the US although as the pound has slipped its more like 60% more now.

           

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      Lowestofthekeys (profile), Sep 20th, 2012 @ 10:12am

      Re:

      " A CD that sells for $10 in the US might only sell for a fraction of that in another country."

      Russian MP3 sites have been around for the better part of a decade. They offer entire albums for a fraction of the cost when compared to services like Itunes, yet they didn't make the RIAA's list of major illegal sources for music piracy - http://torrentfreak.com/images/riaa-chart.jpg.

       

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      weneedhelp (profile), Sep 20th, 2012 @ 10:13am

      Re:

      "A CD that sells for $10 in the US might only sell for a fraction of that in another country." - So im getting ripped off yet again. Thanks for clearing that up.

      Also if they can sell it for less elsewhere and still make a profit; Why do I allow myself to be gouged just because I live in the US?

      What is the best bit torrent client out there now? I think I need to start being an arrrggggh me hearties pirate again.

       

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        Anonymous Coward, Sep 20th, 2012 @ 10:40am

        Re: Re:

        "Also if they can sell it for less elsewhere and still make a profit; Why do I allow myself to be gouged just because I live in the US? "

        Actually, they often sell it for a fraction of it's true market value, just to stay in the market. What they are making from these smaller countries is often peanuts because of the combinations of low retail price and small markets, which results in small licensing fees. I would say that without the major markets (aka, the Western counties) they wouldn't be able to turn a profit at all. Selling CDs for $2 US wouldn't be profitable at all.

        You aren't being gouged because you are in the US, you are paying relative to your income.

         

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          Edward Teach, Sep 20th, 2012 @ 10:52am

          Re: Re: Re:

          > You aren't being gouged because you are in the US, you are paying relative to your income.

          Wait, that doesn't make any sense at all.

          I basically haven't bought music CDs or DVDs in years, except maybe at garage sales or at Goodwill. I don't think the full retail price reflects the value, so I don't pay the full retail price. I'm willing to wait for the music or movie or whatever to show up in discount bins or at garage sales. That's the free market. I pay a price that reflects the product's value to me.

          Setting a variable price based on the income of the putative purchaser is not free market at all: the seller is saying that the price I pay should reflect something other than the value to me.

          I don't know of any sensible market for any good that operates as you say. In fact, the market for some things (computer programmers, call center service reps) has been left to float on a global scale on exactly the free market, price-represents-value-to-buyer type of thing.

          What kind of weird ideologue are you?

           

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            Anonymous Coward, Sep 20th, 2012 @ 10:57am

            Re: Re: Re: Re:

            This happens in other markets. If you ever take a cruise, you will meet crew from all over the world. Their wages are generally tied to the cost of living in their home country.

            Another example is where a medicine distributed in a third world country is subsidized by first world pricing. Otherwise, the cost under the "free market" price would be unaffordable and sick people would do without.

             

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              The eejit (profile), Sep 20th, 2012 @ 11:23am

              Re: Re: Re: Re: Re:

              You mean like in the US, where there generally is a considerable markup when compared with other countries, such as the UK and Germany (never mind countries such as Uganda, Venezuela and Jamaica)?

               

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          John Doe, Sep 20th, 2012 @ 10:56am

          Re: Re: Re:

          Selling CDs for $2 US wouldn't be profitable at all.

          It is barely profitable at $15 and getting less so every day. That is because nobody wants CDs anymore.

           

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          arcan, Sep 20th, 2012 @ 11:02am

          Re: Re: Re:

          i googled the cost of manufacturing a cd, and the cost for making a album cd is about 80 cents for the actual production. the label makes about 6 bucks on it at 15 dollars, the retail makes about 2 bucks. the rest is actually to pay for things such as promotions, and royalties, which is also handled by the label, so they actually get slightly more. note: can not be certain that this info is true, but it seems realistic.

           

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            Lowestofthekeys (profile), Sep 20th, 2012 @ 11:51am

            Re: Re: Re: Re:

            If you consider digital sales, then you have almost no overhead besides marketing costs, which they cut back on when they took out the promotion departments from most of the major labels.

             

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            Mike (profile), Sep 20th, 2012 @ 12:09pm

            Re: Re: Re: Re:

            Somehow those numbers didn't seem to add up.
            If $2 goes to the retail store and the material cost is $1 that leaves $12.

            According to howstuffworks royalties are typically 8-25% of the retail price, which is $1.20-3.75. Also promotions and other expenses come out of the artists royalties, so that means the rest is the label's profit. That says the label is getting $8.25-10.80 profit from the sale of a $15 CD.

             

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          Anonymous Coward, Sep 20th, 2012 @ 11:08am

          Re: Re: Re:

          Actually, they often sell it for a fraction of it's true market value, just to stay in the market.

          So the market doesn't determine the market value?

           

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            Dirkmaster (profile), Sep 20th, 2012 @ 1:28pm

            Re: Re: Re: Re:

            No, of course not. They would say that the "creators" set the price, since it's theirs to sell. But since the creators see precious little, we would have to say THE LABELS set the price to be absolutely accurate.

            All this market talk is a smokescreen for gouging where they can get away with it.

            If if really was priced according to it's true market value, it would all be $0.99 worldwide.

            And it would all go to the artists, the true "creators", not these increasingly pointless distributor/gatekeepers/labels.

             

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          MrWilson, Sep 20th, 2012 @ 11:17am

          Re: Re: Re:

          Nobody asks me at the record store or Amazon or iTunes how much I make a year, so it can't possibly be relative to my income. They don't know my income.

          Some Americans have no income. Do they legally get their music for free if it's relative to their income?

          Did you just justify copyright infringement for poor people?

           

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            Anonymous Coward, Sep 20th, 2012 @ 11:33am

            Re: Re: Re: Re:

            It's a crude argument that can't be reduced to what you, as a specific individual, pay for any product.

            The United States is a rich country - not everyone is rich - but it still is a rich country...so we pay more, simple as that.

             

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              Anonymous Coward, Sep 20th, 2012 @ 12:02pm

              Re: Re: Re: Re: Re:

              The fact that it falls apart under scrutiny or implies something you don't like when reduced does not mean the argument can't be reduced. There's absolutely no reason you can't make the same argument for individuals that was made for countries.

               

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              MrWilson, Sep 20th, 2012 @ 12:12pm

              Re: Re: Re: Re: Re:

              Separating people into different markets based on nation is as arbitrary as separating them into different markets based on individual income. We live in a global economy. I can buy music from Russian websites while residing in the US. It's irrelevant what other people in my country make on average. That's just the content companies trying to justify price gouging. Getting content at a cheaper price from elsewhere in the world is just proving that the price that the market will bear is lower than the local price that the content companies want to charge.

               

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          Anonymous Coward, Sep 20th, 2012 @ 12:23pm

          Re: Re: Re:

          Paying relative to my income is where I'm having a problem.
          I think I would like to pay a fair and reasonable price regardless of my income.Paying what the market will bear is what is responsible for the ever upward spiraling of prices that have nearly bankrupted the US.
          By your reasoning,the $200,000 house that someone purchases who has a $50,000 a year income, should cost someone else with a $200,000 income, 4 times (or more) as much.
          Why don't we all register our incomes with the store so we can pay for that loaf of bread based on how much money we have!

           

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          anon, Sep 21st, 2012 @ 4:05am

          Re: Re: Re:

          The artist makes a few cents on cd's , it is not actually worth them selling them really, the middlemen are the ones that make the money, the studios.
          They would not be happy making a few cents per cd, they want cd prices to rise and make more money all the time, remember they are monopolists and believe they have full control of what music you buy and how much you pay for it.

          They ignore the fact that a lot of people will not pay the ridiculous prices they used to ask for a cd, they will either buy one track or borrow it from a friend to copy to there PC.
          The copyright monopoly is finished, they know it and we know it, they are just trying to wring out as much as they can from the artists that are still dumb enough to sign up to a big studio. Yes they will make money, but most certainly not as much as they could have made going it alone.

           

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        Anonymous Coward, Sep 20th, 2012 @ 11:30am

        Re: Re:

        Utorrent. Make sure to get and update a peer blocker!

         

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        Aussie Rip Off, Sep 21st, 2012 @ 7:58pm

        Re: Re:

        You think you are doing bad. Prices in Australia are usually 50 to 100 percent higher than the US for music, videos, software etc. Then they complain that Australia is one of the worst countries for piracy!!!!

         

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      Anonymous Coward, Sep 20th, 2012 @ 10:23am

      Re:

      [i]You have to pay attention and THINK for a minute. The real issue here is that the economy of each country is not the same. A CD that sells for $10 in the US might only sell for a fraction of that in another country. In order to stay competitive in that country, they have to price at maybe $2. The local distributor licenses from them at a price in consequence of that $2 retail price.[/i]

      It's not like physical goods (CDs, books, etc.) are made in different places for different markets and they cost substantially different amounts to make. They are made by the cheapest factory that can be found. Very rarely is that place different for differing markets.

      So if you can make a profit on a $2 disc in one place, you can pretty much make a profit on the same disc somewhere else (minor distribution cost differences aside) b/c it has the same manufacturing cost.

       

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        weneedhelp (profile), Sep 20th, 2012 @ 10:30am

        Re: Re:

        See what happens when you stop and THINK.

         

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        Anonymous Coward, Sep 20th, 2012 @ 10:43am

        Re: Re:

        Umm, no. That doesn't follow.

        "So if you can make a profit on a $2 disc in one place, you can pretty much make a profit on the same disc somewhere else (minor distribution cost differences aside) b/c it has the same manufacturing cost."

        The point is that there may be little or no profit in it at $2 retail, and it only happens by taking a huge discount on the licensing fees, etc. It's only done because that is incremental income beyond what is generated in the major markets.

        Don't confuse incremental revenue with actual profits. That's like Mike getting all stuck on marginal costs without thinking about the fixed up front costs required to produce the CD to start with (recording and such).

         

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          The eejit (profile), Sep 20th, 2012 @ 11:26am

          Re: Re: Re:

          Not this shit again!

          The marginal costs are directly inflated by the labels. Suppoosedly in order to pay for "marketing and promotion" etc. Those are "unnecessary" costs that are charged to the artists in order to recoup costs.

          Moreover, if it's incremental income, than that means that the profits have already been made and the increments arew pure profit.

          So, I'm not really sure what you're arguing here.

           

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            Anonymous Coward, Sep 21st, 2012 @ 1:14am

            Re: Re: Re: Re:

            LOL

            You, or Masnick, don't have the first clue about what it costs to make and then promote a successful record.

            HOW COULD YOU?

            Seriously!

            How could you?

            You guys are dorky, entitlement monkeys; douchebags with zero experience or knowledge about the things you pontificate about.

            Let's prove my point:

            Tell me exactly what it cost to make Adele's record successful.

            Post the breakdown of the numbers right here:






            You can't.

            Because you have no idea what you're talking about. You're a silly fool and months/years dozing out in Mike Masnick's Reality Distortion Field has somehow made you think differently.

            Hilarious.

             

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              The eejit (profile), Sep 21st, 2012 @ 4:07am

              Re: Re: Re: Re: Re:

              What is "cost" is irrelevant to consumers. Al;so notice that I put "unnecessary" in quotes.

              And as for Adele, it supposedly cost many hundreds of thousands of pounds to advertise nationally. Advertising that the artist pays for at each step, either through royalties or through their advances.

              I will, however, see if I can find out, if you will specify which of adele's albums you wish me to do the figures for. Sound fair?

               

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              JEDIDIAH, Sep 21st, 2012 @ 1:14pm

              Hollywood Accounting.

              > You, or Masnick, don't have the first clue about what it costs to make and then promote a successful record.

              Making a successful record can be done for peanuts. It really all just boils down to how much discipline you have.

              Promotion is "music production" is mostly a sham. There's already a ready made promotion mechanism. You don't even need to feed it payola. When it's working right, you never know what artists might suddenly gain national prominence.

              Most artists (much like authors) probably find that they have to do their own marketing.

               

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      Nathan F (profile), Sep 20th, 2012 @ 10:32am

      Re:

      Buy low, sell high? What? Sounds good to me.

       

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      BeaverJuicer (profile), Sep 20th, 2012 @ 10:36am

      Re:

      A CD that sells for $10 in the US might only sell for a fraction of that in another country. In order to stay competitive in that country, they have to price at maybe $2. The local distributor licenses from them at a price in consequence of that $2 retail price.
      This is how things work in a normal capitalist environment, but you neglect to mention one VERY CRITICAL aspect... The MPAA and RIAA are the SOURCE of the content. They're not worried about people buying Bollywood instead of Hollywood. They don't have to sell for $2 to "stay competitive" into that country, because THERE IS NO COMPETITION, except with themselves. If they don't want their product to undercut their own product, they can normalize pricing throughout their distribution chain. Easy enough done.

       

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        Anonymous Coward, Sep 20th, 2012 @ 10:51am

        Re: Re:

        Just to be clear, the RIAA and MPAA are the trade organizations for the labels and studios, respectively. The labels compete against one another as do the studios. In addition, they compete against the indys, foreign producers and more broadly- others competing to capture the entertainment dollar of consumers. Since they compete already for the entertainment dollar, it's understandable that they don't also want to compete with their own product.

        And withdrawing from a market is not without precedent. Universal stopped selling DVD's in Spain due to rampant piracy. It's not hard to imagine that a studio would leave a market entirely rather than providing a new source of price competition for it in its most important market.

         

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          John Doe, Sep 20th, 2012 @ 10:59am

          Re: Re: Re:

          The labels compete against one another

          Are these the same labels that got busted for price fixing a few years back?

          It's not hard to imagine that a studio would leave a market entirely rather than providing a new source of price competition for it in its most important market.

          The studio may have left the market but I guarantee the content is still there. ;)

           

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            Anonymous Coward, Sep 20th, 2012 @ 11:14am

            Re: Re: Re: Re:

            Do you feel the same about medicines? If an blood pressure medication sells for $5 in the US and $.05 in poor nations and somebody is legally reimporting it into the US and reselling for $1- I can guarantee that the company will leave that market rather. How will that benefit anyone?

             

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              John Doe, Sep 20th, 2012 @ 11:18am

              Re: Re: Re: Re: Re:

              You can guarantee it? I don't think you can make that or any guarantee. The drug companies, like the mafiAA have been price fixing for many, many years. Look at the drug industry in India, it is thriving w/o all of the patent protection. So please, stop your misinformation campaign here.

               

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              Chosen Reject (profile), Sep 20th, 2012 @ 11:48am

              Re: Re: Re: Re: Re:

              I'm fine with your scenario. If the company leaves the US market, so what. Somebody else will fill their shoes. In fact, in your scenario, somebody already did, and did so in such a phenomenally better way that the original company couldn't compete. What's the problem here? Are you saying the original company would leave the blood pressure medication market altogether? I'm fine with that also. If there is a profit to be made and they don't want any because they can't have it all, somebody will fill their shoes with a generic. Win for the customers who get it cheaper, win for the company that sells it cheaper who now have one less competitor.

               

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              Ninja (profile), Sep 20th, 2012 @ 11:51am

              Re: Re: Re: Re: Re:

              It's not like that. The first sale doctrine applies to content you purchased for personal use. It is forbidden in most countries to buy and resell medicine without authorization.

              We are talking about a book/cd you bought overseas and don't want anymore so you sell for the second hand market. It's a single item, at most two if you bought an extra copy. So please, stop missing the point and trying to mislead ppl.

               

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                Anonymous Coward, Sep 20th, 2012 @ 12:15pm

                Re: Re: Re: Re: Re: Re:

                That's simply untrue. The facts of the case are that Kirtsaeng purchased Wiley textbooks abroad and imported them into the US. The texts were produced abroad and sold for much less than in the US. It wasn't some guy selling a used CD he bought in Egypt when he got back from vacation. Kirtsaeng was engaged in a business enterprise.

                 

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                  The eejit (profile), Sep 20th, 2012 @ 12:48pm

                  Re: Re: Re: Re: Re: Re: Re:

                  So, for Universal Music Group, it's okay to export costs, but not for other businesses?

                  Gotcha.

                   

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                  Anonymous Coward, Sep 20th, 2012 @ 1:39pm

                  Re: Re: Re: Re: Re: Re: Re:

                  Amazingly, there are several import/export dealers that will purchase goods and ship them internationally.
                  I know mostly of Japanese companies, since I travel there a lot.
                  Tenso
                  White Rabbit Express
                  Urban Shipping Service

                  Since when has this ever been illegal. Of course you are supposed to check regualations as well as import duties, but this is a commonplace industry.

                   

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                  Ninja (profile), Sep 21st, 2012 @ 3:41am

                  Re: Re: Re: Re: Re: Re: Re:

                  That's simply untrue.

                  In your dreamland. She didn't import, she bought them for personal use and maybe to gift some friends/relatives. It's not some major import operation. I've bought 8 Victoria Secret lotions last time I went to the US (they are like 20% of the Brazilian price) for my mother, sister, cousins, aunts and two friends of mine. Not any major operation. The first sale doctrine applies.

                   

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                    Anonymous Coward, Sep 21st, 2012 @ 5:48am

                    Re: Re: Re: Re: Re: Re: Re: Re:

                    "That's simply untrue."

                    In your dreamland. She didn't import, she bought them for personal use and maybe to gift some friends/relatives. It's not some major import operation. I've bought 8 Victoria Secret lotions last time I went to the US (they are like 20% of the Brazilian price) for my mother, sister, cousins, aunts and two friends of mine. Not any major operation. The first sale doctrine applies.

                    You are so staggeringly misinformed it is almost unimaginable. You don't know the basic facts of the case and yet you presume to argue the merits?

                    First of Kirtsaeng is a he, not a she. Second, it was a commercial, for profit operation. No one disputes that. Third, wtf does you buying lotion for your Mom and (probably) Victoria's Secret panties for yourself have to do with ANYTHING?

                    Here's a paragraph on the background of the Kirtsaeng case from theatlantic.com:

                    John Wiley & Sons, a textbook publisher, sells expensive versions of the textbooks here and less expensive versions abroad. Supap Kirtsaeng, a foreign graduate student at University of Southern California, decided to help pay for his schooling by having relatives buy him copies of the foreign versions abroad, send them to him, whereupon he'd sell those books on eBay to willing students. He'd make money, the students would save money, but Wiley might have fewer sales of its pricey American versions. The case is styled Kirtsaeng v. John Wiley & Sons.

                     

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          BeaverJuicer (profile), Sep 20th, 2012 @ 11:07am

          Re: Re: Re:

          Again, this isn't about the RIAA or MPAA worrying about people buying Bollywood vs Hollywood, or competing with indys or foreign producers. They have a monopoly on their own titles. This is about Hollywood having to compete with ITSELF. This is most easily solved by normalizing pricing on a global scale. Yes, that may mean a couple fewer Avengers sales in Kenya, but they wouldn't have to worry about their own product undercutting themselves.

           

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          Dirkmaster (profile), Sep 20th, 2012 @ 1:40pm

          Re: Re: Re:

          Universal is, in this instance, simply STUPID!

          "Some people are not buying our produce legally. So we'll make it so that NO ONE can buy our product legally."

          Yeah, that makes a whole lot of sense.

          It punishes good-doers and doesn't affect the evil-doers.

          In what conceivable way is this a productive solution?

           

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            Anonymous Coward, Sep 20th, 2012 @ 1:52pm

            Re: Re: Re: Re:

            Lets say the book sells for $10 in the US and $2 in Mali. The book costs $1 to produce. If someone imports 1000 books from Mali and undercuts my price in the US, I lose $8000 ( US price minus Mali price times 1000). It then becomes a decision of whether the Mali market with its $1 profit margin is worth servicing if it provides direct competition to my US market where I have a $9 profit on the same item.

             

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              Gwiz (profile), Sep 21st, 2012 @ 8:43am

              Re: Re: Re: Re: Re:

              The book costs $1 to produce. If someone imports 1000 books from Mali and undercuts my price in the US, I lose $8000 ( US price minus Mali price times 1000).

              Whoa there Hoss. Your using a bit of Hollywood accounting there.

              You didn't lose $8000, you lost $1000 (ie: the cost to produce 1000 units). Lost sales are not actual loses, they are simply wishful thinking.

              And you are also not taking into account that you got $2 on the original sales in Mali for a total profit of $1000.

               

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                Anonymous Coward, Sep 21st, 2012 @ 9:19am

                Re: Re: Re: Re: Re: Re:

                "The book costs $1 to produce. If someone imports 1000 books from Mali and undercuts my price in the US, I lose $8000 ( US price minus Mali price times 1000)."

                Whoa there Hoss. Your using a bit of Hollywood accounting there.

                You didn't lose $8000, you lost $1000 (ie: the cost to produce 1000 units). Lost sales are not actual loses, they are simply wishful thinking.


                Yes I did. I am using the textbook example. I am the sole source of a text that is required for a certain class. So lost sales are undoubtedly actual losses, not wishful thinking.

                And you are also not taking into account that you got $2 on the original sales in Mali for a total profit of $1000.

                Yes I did. The difference sales at $10,000 and $2000 includes the $1000 profit made from sales in Mali.

                 

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                  Gwiz (profile), Sep 21st, 2012 @ 10:12am

                  Re: Re: Re: Re: Re: Re: Re:

                  I am the sole source of a text that is required for a certain class. So lost sales are undoubtedly actual losses, not wishful thinking.

                  Nope. Still wishful thinking. It doesn't matter that you hold your customers by the short hairs with asinine class requirements. By your standards, every textbook resold at the college bookstore or shared between friends who have the same class is a lost sale.

                  Yes I did. The difference sales at $10,000 and $2000 includes the $1000 profit made from sales in Mali.

                  Ok, my mistake. But the end result is still a gain of $1000 since lost sales mean nothing.

                   

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                    Anonymous Coward, Sep 21st, 2012 @ 12:37pm

                    Re: Re: Re: Re: Re: Re: Re: Re:

                    "I am the sole source of a text that is required for a certain class. So lost sales are undoubtedly actual losses, not wishful thinking."

                    Nope. Still wishful thinking. It doesn't matter that you hold your customers by the short hairs with asinine class requirements. By your standards, every textbook resold at the college bookstore or shared between friends who have the same class is a lost sale.

                    You are still wrong. Books being re-sold or shared are a market factor no matter what. And that resale/sharing factor influence price. The price erosion pressure that comes from reimporting books further erodes the price. It is not a benign force.

                    "Yes I did. The difference sales at $10,000 and $2000 includes the $1000 profit made from sales in Mali."

                    Ok, my mistake. But the end result is still a gain of $1000 since lost sales mean nothing.

                    The least of many, no problem.

                     

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                      Gwiz (profile), Sep 21st, 2012 @ 7:08pm

                      Re: Re: Re: Re: Re: Re: Re: Re: Re:

                      You are still wrong. Books being re-sold or shared are a market factor no matter what. And that resale/sharing factor influence price. The price erosion pressure that comes from reimporting books further erodes the price. It is not a benign force.

                      Ok, but this looks like price erosion caused by natural market forces overcoming an artificial barrier placed in the way to me. It pretty much gives me a divide-by-zero error trying to equate that to "lost sales" in any way, shape or form.

                       

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                Anonymous Coward, Sep 21st, 2012 @ 9:33am

                Re: Re: Re: Re: Re: Re:

                Try thinking beyond the end of Masnick's leash.

                 

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                  Gwiz (profile), Sep 21st, 2012 @ 10:14am

                  Re: Re: Re: Re: Re: Re: Re:

                  Try thinking beyond the end of Masnick's leash.

                  I am not on anyone's leash, I think for myself.

                  And right now I am thinking that you are an ass.

                   

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              Gwiz (profile), Sep 21st, 2012 @ 10:37am

              Re: Re: Re: Re: Re:

              It then becomes a decision of whether the Mali market with its $1 profit margin is worth servicing if it provides direct competition to my US market where I have a $9 profit on the same item.

              Simple question: Why not set the prices at a fair profit margin globally?

              We do live in a global market nowadays. I can visit a Mali bookselling website with one click and compare with your US prices rather easily. If you are selling your books in Mali at $2 and are happy with that profit margin, why are you charging $10 in the US?

               

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                Anonymous Coward, Sep 21st, 2012 @ 12:11pm

                Re: Re: Re: Re: Re: Re:

                Because professor, in the case of textbooks we've been discussing- a global price set a the intersection of the global supply and demand curves would be massively influenced by the US and other wealthy, industrialized markets. The low demand from the third world would barely move the needle as the demand is so low. The net effect would be that those textbooks would be priced significantly higher than if using regional market pricing. This is Econ. 101. This is not difficult to fathom is you are truly thinking independently. In this case, regional pricing promotes greater affordability and access. How can you possibly oppose that?

                 

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                  Gwiz (profile), Sep 21st, 2012 @ 6:34pm

                  Re: Re: Re: Re: Re: Re: Re:

                  Look, I will be the first to admit that economics isn't my strongest suit, I've usually been on the engineering/production side of companies. There really isn't any need to be a dick.

                  I understand what you are saying, but you still really haven't answered my (possibly poorly expressed) question:

                  How does the above economic practice remain stable in a world where instantaneous, global communication and relatively inexpensive worldwide shipping exists?

                   

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                    Anonymous Coward, Sep 22nd, 2012 @ 6:01am

                    Re: Re: Re: Re: Re: Re: Re: Re:

                    How does the above economic practice remain stable in a world where instantaneous, global communication and relatively inexpensive worldwide shipping exists?

                    Good question. It may not. Enforcing current law (assuming Wiley prevails) will certainly help considerably. But the consequence of instantaneous global communication and relatively inexpensive worldwide shipping is that regional pricing models will be a thing of the past. And what that means (at least in economic theory) is that third world prices of US text books will rise to prevent erosion of margins in more profitable first world markets. What won't happen (which is the misplaced hope and expectation of many) is that first world prices will decrease to defend market share in the third world. In this case, high margins in large markets will continue and low margins in small markets will be abandoned. All to the detriment of those small (third world) markets.

                     

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                      Gwiz (profile), Sep 22nd, 2012 @ 10:00am

                      Re: Re: Re: Re: Re: Re: Re: Re: Re:

                      Interesting. The whole theory really depends on a separation of markets in the first place.

                      Now I understand that there are other natural divisions that currently exists between markets, mainly language and currency.

                      But even those are being further eroded by technology aren't they? We have simple tools like Google Translate available, so language isn't too much of a barrier anymore. We can calculate an exchange rate at any given moment. Other than things that are artificially manipulated, like exchange rates and import tariffs, what is really stopping us from developing a global market where it's truly equal across geographical regions?

                      It just seems like the idea behind regional pricing, while most definitely useful in the past, is becoming antiquated and edging towards existing only to serve itself.

                       

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                        Gwiz (profile), Sep 22nd, 2012 @ 10:26am

                        Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                        After thinking about this some more I realized I had forgotten about probably the most significant division between markets: governments and differing regional laws.

                        Although, the existence of the European Union itself indicates that this also can be addressed, perhaps even on a global level.

                         

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        JEDIDIAH, Sep 21st, 2012 @ 1:30pm

        Bollywood = Hollywood - 20

        That "self-competition" still exists here in the US. That might be part of the problem that Big Content is facing now. They have a terminal format on their hands and decades of content available out there that will only ever need to be purchased once.

        That's why there are $5 DVDs and BDs.

         

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      Anonymous Coward, Sep 20th, 2012 @ 10:40am

      Re:

      I tend to agree. Why would any producer of goods undercut its most lucrative market? If they are selling an item for $2 in a poor nation only to have them re-imported into the US market where the price is $10; the likely response is to stop sales entirely in poor countries. To do otherwise would be to enter into a pricing war with yourself.

       

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      Anonymous Coward, Sep 20th, 2012 @ 10:54am

      Re:

      The full on implications of being allowed to sell something you've purchased legally in another country? You're joking, right? Here's a thought - fuck the *AA. If they can't stay in business on their own, I don't give a fuck enough to give up rights to help them stay afloat.

       

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        Anonymous Coward, Sep 20th, 2012 @ 11:26am

        Re: Re:

        Bingo. Adapt to changing markets or fucking die already.

         

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          Anonymous Coward, Sep 21st, 2012 @ 12:58am

          Re: Re: Re:

          Not about changing markets.

          It's about the rules of economics.

          Which are regularly ignored around here.

          And that's why no one takes this blog seriously.

          This blog is nothing but incidental, time-wasting-on-the-interwebz entertainment.

          Thrilled that Google is still paying for Mazzy's plane rides to this week's "complain about copyright" destinations, tho. The more money those asshats waste, the better for society.

           

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            Anonymous Coward, Sep 21st, 2012 @ 3:09am

            Re: Re: Re: Re:

            If no body takes this blog seriously why are you here trying to argue the toss?

             

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            JEDIDIAH, Sep 21st, 2012 @ 1:34pm

            Frayed ends of Hypocrisy

            You seem to be getting your panties in a bunch quite a bit over "incidental time wasting entertainment".

            You make it sound like this sort of stuff should not be held in higher regard than obviously more important things like free speech, personal property rights, the security of the internet and the rest of the economy.

            If the market can't support something then it goes away. That's how the free market works. This isn't communism. You can't just let the state be your patron.

            You've got to be able to actually convince people to buy from you.

            Acting like a total jack*ss usually doesn't help in this regard.

            It's like Romney and his 47%. You can't insult the customer and expect them all to take in stride. Some of them are bound to take it personally.

             

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              terry (profile), Sep 21st, 2012 @ 4:12pm

              Re: Frayed ends of Hypocrisy

              You have highlighted a major problem in America. We have become *customers* of government instead of the employers and beneficiaries we rightfully should be.

              The power dynamic between We The People and the Governments have become upside down.

               

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      Anonymous Coward, Sep 20th, 2012 @ 11:17am

      Re:

      The first reason your argument sucks is because Mike is arguing, in this case, for the law to remain as it has been and to preserve the first sale rights consumers have always enjoyed. So your predictions of doom and gloom would already be true and there should already be no music or movie industries for the reasons you just cited. What else even needs to be said.

       

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      Anonymous Coward, Sep 20th, 2012 @ 11:25am

      Re:

      You sir are a fucking moron. Please feel free to fuck right off and take your bullshit trolling elsewhere.

       

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      Atkray (profile), Sep 20th, 2012 @ 11:37am

      Re:

      Congratulations, you have successfully figured out why Walmart no longer claims that everything they sell is "Made in the USA".

       

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      Anonymous Coward, Sep 20th, 2012 @ 12:15pm

      Re:

      You are asking for:

      - Government intervention in copyright markets
      - Region-locking
      - A strenghtening of the weakest copyright rules towards the most draconian. No compromise!

      Doing this on the internet would take a complete reinvention of the basic setup and removal of any kind of cryptation to allow a surveillance that is even close to what would be needed.

      Just trying to sculpt the world around how you want it to be and are used to things being done is not only impractical bordering impossible. It is dilusional!

      When we are operating in worlds with no possibility of enforcing this kind of draconian border control, you have to do without the price-differentiation. You are forced to compete on a market that includes the low price markets and low copyright barriers. No matter how hard you try to build an illusion of price-control!

      You have to, gasp, cut costs and reinvent your business-model from the "charity" for the poor you describe to something that can survive a fight on lower prices!

      This case will not change those facts. If the judges rule in favour of the region-specific pricing, it may make the record companies survive for a month or two longer than they would otherwise, but have no illusion about the long run. The sign says: "Change or die!"

       

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      antimatter3009 (profile), Sep 20th, 2012 @ 1:25pm

      Re:


      The real issue here is that the economy of each country is not the same. A CD that sells for $10 in the US might only sell for a fraction of that in another country. In order to stay competitive in that country, they have to price at maybe $2. The local distributor licenses from them at a price in consequence of that $2 retail price.

      This is entirely a business model decision. No one is forcing them to charge different prices. Maybe that business model worked great for the last century, but if the world has changed such that this business model no longer works then they need to move on. Why should we be restricting consumer rights just so that they can continue to use their chosen business model that relies on (now) artificial scarcity?

       

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        Anonymous Coward, Sep 20th, 2012 @ 1:42pm

        Re: Re:

        What if the consequence of the universal pricing you insist on is that it is universally high rather than universally low? What does that mean to impoverished people? And what will that sentiment mean if it is applied to things like medicine?

        I'm not sure you really want what you're asking for.

         

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          Benjo (profile), Sep 20th, 2012 @ 3:29pm

          Re: Re: Re:

          Piracy and knock off drugs.

           

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          Anonymous Coward, Sep 20th, 2012 @ 3:29pm

          Re: Re: Re:

          I just love how you keep re-casting greedy corporate price gouging as a noble attempt to serve poorer countries? Has anyone bought it yet?

           

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            Anonymous Coward, Sep 20th, 2012 @ 3:48pm

            Re: Re: Re: Re:

            I just love how you keep re-casting greedy corporate price gouging as a noble attempt to serve poorer countries? Has anyone bought it yet?

            I don't know, but certainly no one has refuted it.

             

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              That One Guy (profile), Sep 20th, 2012 @ 4:23pm

              Re: Re: Re: Re: Re:

              Perhaps because it's so ridiculously, obviously wrong that no-one feels the need to?

              Might as well say 'Since no one has refuted my claim that sticking your hand into a fire is harmless and merely tickles, that makes it true.'

               

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                Anonymous Coward, Sep 20th, 2012 @ 5:22pm

                Re: Re: Re: Re: Re: Re:

                Perhaps because it's so ridiculously, obviously wrong that no-one feels the need to?

                Might as well say 'Since no one has refuted my claim that sticking your hand into a fire is harmless and merely tickles, that makes it true.'


                Wow, you really have me writhing in the crushing grip of reason now.

                 

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              Anonymous Coward, Sep 20th, 2012 @ 5:50pm

              Re: Re: Re: Re: Re:

              If you want refutations, countries in Asia like Malaysia and Indonesia are extremely concerned that the bulk of their citizens won't be able to afford said medicine.

               

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      John Fenderson (profile), Sep 20th, 2012 @ 1:54pm

      Re:

      We have a non-copyright mechanism to deal with this sort of economic inequality: import duties. There's no reason to distort copyright even further to cover the situation.

       

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      Loki, Sep 20th, 2012 @ 3:44pm

      Re:

      Speaking of unrealistic, that whole argument is just so far beyond silly is preposterous.

      Your argument is only valid if no business ever imported goods from another country to sell here. However, decreased labor/production costs are one of the largest reasons so much of our manufacturing base has already been shipped outside the US. Now I don't know what percentage of books sold in this country are actually manufactured overseas, but it wouldn't surprise me to learn a large portion of them came from the same overseas wholesaler (assuming the guy was actually able to buy direct from the wholesaler and not have to buy from a retailer) this guy got his merchandise from (and probably at a lower price, since most places give a discount based on bulk purchases - this is how Walmart manages to keep prices so low).

      Now you eliminate the First Sale doctrine, and the incentive to outsource even more manufacturing outside the US has now increased exponentially. No more competition from resale shops, second hand stores, or refurbished products? And we're not just talking about a book, CD, or DVD.

      Sorry, you can't resell that shirt it was made in China. That computer? Made in Tiawan. Can't sell that chair, either. It was made in Malaysia.

      And I can tel you from experience that many people (not by any means all, but enough) making decisions at the tops of larger companies have little clue how much the secondhand/resale market impacts the US economy, they'd just see this as a way to eliminate even more competition by moving even more manufacturing overseas (hitting us not once, but twice).

       

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        Anonymous Coward, Sep 20th, 2012 @ 3:55pm

        Re: Re:

        It's Wiley's own product!!!!!!!! Wiley isn't complaining about a competing product, they are complaining about a middleman buying it in a low cost market and using it to compete against Wiley in a high cost market. This isn't the case of a competitor offering a competing textbook at a lower price.

         

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        Anonymous Coward, Sep 20th, 2012 @ 4:11pm

        Re: Re:

        I hope that the Supreme Court makes a good decision. I agree that clarity is needed. I hope that the "used" market is not impacted. I don't think that's right. But I also do not think that it is OK for a middleman to reimport new items in a low cost market and use them to undermine margins on the identical product in a high margin market.

         

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          Anonymous Coward, Sep 20th, 2012 @ 4:24pm

          Re: Re: Re:

          "I hope the Supreme Court makes a good decision". And I hope to get a date with Lady Gaga after winning the lottery, Nobel Prize, and Pirate Of The Year award.

           

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      Milton Freewater, Sep 20th, 2012 @ 3:56pm

      Re:

      "Mike, this is another case where I seriously wonder what you were doing while you were at school, because you clearly didn't get much of what was going on.

      You have to pay attention and THINK for a minute. The real issue here is that the economy of each country is not the same. A CD that sells for $10 in the US might only sell for a fraction of that in another country. In order to stay competitive in that country, they have to price at maybe $2. The local distributor licenses from them at a price in consequence of that $2 retail price."

      Jesus Hopping Christ.

      You have just presented a sound argument to ban ALL selling of imported ANYTHING.

      You have also presented a sound argument for making it illegal to give anyone a gift purchased overseas, as that would be an unauthorized redistribution for a return of zero dollars.

      Have you ever heard of the import/export business? Ever wonder what that was? Think about it.

      Mike's argument is that either we do in fact make all gifting and selling of imports illegal or we don't single out makers of CDs for special treatment.

       

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      That Anonymous Coward (profile), Sep 20th, 2012 @ 9:28pm

      Re:

      Where does this CD sell for $2? Imaginationstan?

      On the surface it sounds reasonable the words your babbling forth, but that pretends that we can't see that they charge even more everywhere. There is no place where they lower the prices. Maybe if they started thinking of it as 1 global market, because *GASP* that is what we have now, and took out their own middlemen stumbling blocks they could stop trying to charge more based on the region and just release it at 1 price point that is then converted into the local currency rate.

      The going rate on iTunes is like $1, can't be hard to charge the same price in Yen, Rubles, etc...

      Nice strawman, I enjoyed setting it on fire.

       

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      Anonymous Coward, Sep 21st, 2012 @ 6:34am

      Re:

      ad hom king. By the way, we're talking about used goods here dufus.

       

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      Michael, Sep 21st, 2012 @ 8:09am

      Re:

      Your post is one big pile of logical fallacy. If producing content in the US didn't generate profits, both the movie and music industries would've eschewed those methods a long time ago for something else, yet they haven't.

      It's not the consumers' fault when a movie studio decides to blow $100 million just to produce ONE movie, let alone be held responsible should the studio not recoup, now isn't that right?

      If content was so darn expensive to make then kindly explain why there's such an abundance of content being produced on the local level? Yet I'm supposed to buy this notion that all these mega-rich corporations cannot afford to? Tell me, how much money do the major labels and movie studios have sitting in their back pockets? How much money do their top CEOs pull in annually? I'm very curious.

      It's obvious that the folks over at the RIAA and MPAA sit around discussing ways that they can rook the system in order to line their own pockets, whether it be harassing small business owners with legal threats (read: extortion), using their absurd tactic of double-dipping royalty rates, copyfraud, et al. And now they're attempting to rescind the first-sale doctrine, trying to paint this phony doom & gloom situation whereby the economy will collapse (*GASP!*)unless they're allowed to syphon profits from the sale of used goods.

      These royalty collection societies are greedy parasites that do absolutely nothing beneficial for our economy.

       

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    Anonymous Coward, Sep 20th, 2012 @ 10:01am

    Extending the first sale doctrine to copies made abroad for distribution in a foreign market could impede authors’ ability to control entry into distinct markets, limit their flexibility to adapt to market conditions, or undermine territorial licensing agreements.


    Funny - I read through Title 17, and I couldn't find any mention of controlling entry in distinct markets, flexibility to adapt to market conditions, nor enforcement of territorial license agreements mentioned anywhere there. If these are copyright issues, you'd think they'd be in the law somewhere as protected rights.

    Perhaps someone could point me to the relevant sections?

     

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      The eejit (profile), Sep 20th, 2012 @ 11:29am

      Re:

      Pretty much this: the MAFIAA claim they want a globalised market, then complain when the market actually globalises and they're forced to compete.

      It's flawless logic! /s

       

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      Dio Gratia (profile), Sep 20th, 2012 @ 6:16pm

      Re: Rights in distinct markets


      17 USC § 106:

      Subject to sections 107 through 122, the owner of copyright under this title has the exclusive rights to do and to authorize any of the following:

      ...

      3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending;
      ...

      The copyright holder is granted a monopoly, they can distribute however they wish.

      The issue is that the limitations on § 106(3) aren't in force for foreign sold goods:

      17 USC § 109:

      (a) Notwithstanding the provisions of section 106 (3), the owner of a particular copy or phonorecord lawfully made under this title, or any person authorized by such owner, is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy or phonorecord.
      ...

      If we look at House Report 94-1476 on § 109 (a) we find:

      To come within the scope of section 109 (a), a copy or phonorecord must have been “lawfully made under this title,” though not necessarily with the copyright owner’s authorization. For example, any resale of an illegally “pirated” phonorecord would be an infringement, but the disposition of a phonorecord legally made under the compulsory licensing provisions of section 115 would not.

      Which tells us the language was selected to make it possible to sell a copy produced based on a limitation to § 106. A Congressional cure might be to amend "the owner of a particular copy or phonorecord lawfully made under this title" to "the owner of a particular copy or phonorecord lawfully made under this title or by authority of the copyright owner".

      The idea being the prevention of expanding the copyright owner's rights for foreign sales to exclude first sales exemption

       

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        JEDIDIAH, Sep 21st, 2012 @ 1:39pm

        Re: Re: Rights in distinct markets

        > to the public by sale or other transfer of ownership

        by sale or other transfer of OWNERSHIP

        It's not just a glorified rental.

         

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      Anonymous Coward, Nov 27th, 2012 @ 11:47am

      Re:

      The closest you are going to get in Title 17 to what you mention is going to be at 17 USC § 602, which bans "infringing importation ... of copies", specifically stating that the importation of copies acquired outside of the country into the US without the copyright holders consent is consider a violation of the right to distribute. In the end, the first sale argument at the crux of Kirtsaeng is aimed at this provision.

       

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    Anonymous Coward, Sep 20th, 2012 @ 10:20am

    they are one of the reasons the economy is in the state it is. trying to pass the buck wont help and trying to get people in the US to pay for the same item more than once certainly wont. however, i suppose according to them, it's ok if they sell things elsewhere impeding the local markets. best bet would be for the RIAA and MPAA to just cease to be!

     

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    John Doe, Sep 20th, 2012 @ 10:34am

    Their words give them away...

    Copyright protection is essential to the health of the motion picture and music industries and the U.S. economy as a whole

    So the whole US economy will collapse w/o copyright?

    authors’ ability to control

    And here it is. They admit they want control.

    obtaining the economic reward Congress intended

    No, the intention was to progress the useful arts, rewarding the producers is a side effect.

    which may be substantially less generous or well enforced than U.S. copyright lawsupported 2.1 million jobs

    A quick Google search did not tell me how many jobs are in the use, but there are over 300 million people, subtract half or more for kids, retirees and the unemployed and maybe end up with 100 millions jobs. So they want us to bend over backwards for a mere 2% of the jobs? Not to mention that even given their dire predictions are true, not all jobs would be lost so maybe it is 1%?

     

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      John Doe, Sep 20th, 2012 @ 10:41am

      Re: Their words give them away...

      limit their flexibility to adapt to market conditions

      Forgot this gem. If they had adapted to market conditions, we wouldn't be having this discussion or court case.

       

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    Anonymous Coward, Sep 20th, 2012 @ 11:06am

    Because having the courts and Congres prop up old business models must be better than actually innovating and (*gasp*) letting people resell what they legally bought.

    I don't think there's an issue of someone reselling their personal copy of a CD. The problem comes when someone tries to build a business model by doing it on a large scale. I don't see any innovation here. Only something that result in a further restriction of access to culture in poor countries.

     

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      The eejit (profile), Sep 20th, 2012 @ 11:30am

      Re:

      But here's the thing: it is innovative. It is a completely disruptive force to the current markets. And you can be damn sure that that is exactly why the MAFIAA want the laws changed. Again.

       

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        Anonymous Coward, Sep 20th, 2012 @ 11:38am

        Re: Re:

        What if it then causes music, publishing, motion picture, software and pharmaceutical companies to abandon those poor country markets? Who wins?

         

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          John Doe, Sep 20th, 2012 @ 11:52am

          Re: Re: Re:

          The guy who comes in and fills those abandoned markets. Your assumption, just like the mafiAA and drug cartels is that they are the only ones who can fill the need. That is not true now, never has been and never will be. Look at the drug industry in India, tons of players there, but you are trying to ignore that and make up your own scenario.

           

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            Anonymous Coward, Sep 20th, 2012 @ 12:50pm

            Re: Re: Re: Re:

            To be fair Copyright = State granted monopoly. Anyone "filling" the market would be breaking the law.

            Drugs is the exception where "generic" medicine is kept legal (because of some very, very unfortunate courtcases in South Africa where a plethora of big pharmaceuticals sued to keep generic HIV-medication out, disregarding the fact that they could never saturate the market anyway with the prices they "needed" to take! See Doha declaration or 2001 lawsuit).

             

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          Ninja (profile), Sep 20th, 2012 @ 11:59am

          Re: Re: Re:

          Rather than who wins, the question is "WHO LOSES?".

          Answer: the MAFIAA. Spanish people will still get the content one way or the other ;)

           

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          The eejit (profile), Sep 20th, 2012 @ 12:49pm

          Re: Re: Re:

          Whoever disrupts the markets there.

          It's seriously not that hard to grok. If there is a gap in the market, someone will fill it, similarly to a dry riverbed: the water won't run around it, it will run through it when it rains.

           

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          Anonymous Coward, Sep 21st, 2012 @ 6:39am

          Re: Re: Re:

          then they's be better off because their own countriy could start supplying drugs or whatever. It was the 1st world who took that right away from them in the first place.

           

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      Anonymous Coward, Sep 20th, 2012 @ 11:36am

      Re:

      If someone else can buy something retail from off the shelf in one country, then make a profit selling in another, I'd call that damn innovative.

      As a corollary, if someone can make a profit by purchasing items you sell from off the shelf and undercut you, you're missing a huge opportunity somewhere. You should hire that person.

       

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        Anonymous Coward, Sep 20th, 2012 @ 11:43am

        Re: Re:

        The inevitable response is that the producer of the good will no longer sell into that market. Not a huge deal with entertainment but a big deal with software and enormous problem if its medication. For people who incessantly cry about collateral damage, I'd have thought this would be apparent.

         

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          Anonymous Coward, Sep 20th, 2012 @ 11:54am

          Re: Re: Re:

          In what way is it apparent? Are you saying that businesses are running underground charities? If I don't agree to pay for an overpriced CD(or whatever) in the US, then some poor orphan in a third world country somehow goes without music/software/medicine? If I want to give to charity, I'll give to charity, not buy an overpriced item.

          I suspect the motives of the businesses in question are capitalistic, not altruistic. If they were somehow loosing money in those other countries, they wouldn't sell there. I don't doubt that they'd prefer to sell at a much higher price for no other reason than, hey, they can, but that's not really a net benefit to the consumer.

           

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            Anonymous Coward, Sep 20th, 2012 @ 12:45pm

            Re: Re: Re: Re:

            No I'm saying that margins are cut in certain markets to reflect the local economy in some industries. If the reward for serving those markets is that people will buy in wholesale amounts and reimport to compete against the original company in a high price market- then that company will simply withdraw from the low price market to avoid having to compete against itself in the high price market.

             

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              Anonymous Coward, Sep 20th, 2012 @ 1:19pm

              Re: Re: Re: Re: Re:

              So...we should limit every person's right to resale to prop up larger margins of some companies over the threat that they may pull out of smaller-margin regions? Why should I sacrifice to save a company from having to make a business decision? If it's not economically beneficial to sell to a certain market...perhaps they shouldn't be selling there.

               

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                Anonymous Coward, Sep 20th, 2012 @ 1:34pm

                Re: Re: Re: Re: Re: Re:

                If it's not economically beneficial to sell to a certain market...perhaps they shouldn't be selling there.

                That is what will happen and those impoverished people will suffer. If the fundamental concept extends to medication it will really be bad.

                 

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                  Anonymous Coward, Sep 20th, 2012 @ 1:44pm

                  Re: Re: Re: Re: Re: Re: Re:

                  So now, you're trying to compare the prices of music (which is a luxury in the truest sense) to medicine?

                  And here I thought some couldn't sink so low.

                  You heard it here first people. If the RIAA/MPAA's business models won't be supported through the courts, eventually the world will go mad. And how will the sick get their medicine? No point in providing for those who can't afford it.

                  What's that you say? Some countries put the lives of people over the needs of companies coffers? The hell you say?! Why, sounds like pure sense and logic have won the day.

                  I find it beyond amusing (as well as repulsive) that you're now trying to conflate the purchasing of physical discs of music and film to the purchasing of medication. But I suppose when trying to justify something that cannot be justified you'd have to try and tug at something near and dear to a great many. You sir (or madam) have a great future ahead of you working for those who need not be named. Say it with me, "But but but piracy and the used goods market! Hurtful, without proof, they are!"

                   

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                    Anonymous Coward, Sep 20th, 2012 @ 2:22pm

                    Re: Re: Re: Re: Re: Re: Re: Re:

                    I don't know what you are trying to say here. You seem to understand that region-based pricing allows medicine to be more affordable in poorer countries. Presumably, you'd agree that lower priced books (movies, music or software) likewise have a societal benefit in those poor countries.

                    But then you seem to decry the notion that companies will withdraw from those poorer markets if unscrupulous middlemen import the product from the poor country to undercut the company in more lucrative markets- but only as it applies to medicine.

                    I really don't get that at all. You appear to want the low price in the poor country and to also allow middlemen to import to a high margin country and use their own product to compete against them in the high margin country; and somehow feel that the companies have some sort of moral obligation to promote the cannibalization of their own high margin market. Not an econ major I presume.

                     

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                  Anonymous Coward, Sep 20th, 2012 @ 1:58pm

                  Re: Re: Re: Re: Re: Re: Re:

                  Again, if I want to give to charity, I'll give to charity, not buy an overpriced item. I somehow doubt that more of that significant markup on music is going to help orphans in a poor country.

                   

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              John Fenderson (profile), Sep 20th, 2012 @ 2:39pm

              Re: Re: Re: Re: Re:

              then that company will simply withdraw from the low price market to avoid having to compete against itself in the high price market.


              ...and will be replaced by different entities that will fill the now-unfilled need.

               

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                Anonymous Coward, Sep 20th, 2012 @ 2:56pm

                Re: Re: Re: Re: Re: Re:

                "then that company will simply withdraw from the low price market to avoid having to compete against itself in the high price market."


                ...and will be replaced by different entities that will fill the now-unfilled need.

                It may be tough for substitute drugs, high level software, textbooks and entertainment to fill that void. Particularly if they suffer the same fate- their own products being reimported and used to compete against them in their high dollar markets. I doubt anyone will have much incentive to serve impoverished markets if the cost of doing so is being undercut by their own product in high margin markets.

                 

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                  That One Guy (profile), Sep 20th, 2012 @ 4:57pm

                  Re: Re: Re: Re: Re: Re: Re:

                  Going down the list: generics, open source or a different company's product, different source, the countless amounts of free entertainment available and/or different source... Yeah, it would really be difficult for a country to replace those truly priceless things.

                  You seem to be under the mistaken impression that if a company pulls out of a country due to it not being profitable enough for them to operate there that no-one will step up to replace them. This is glaringly false, companies, both local and foreign would be chomping at the bit to enter a market with the demand side already filled, and the supply side recently vacated, as they'd make an absolute killing.

                  And as to the first company, who suddenly finds themselves undercut by the new companies and is now left in the cold? Who cares? For every market they pull out of due to it not being profitable enough, a whole slew of other companies will be more than willing to step in and fill the void.

                   

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                    Anonymous Coward, Sep 20th, 2012 @ 5:16pm

                    Re: Re: Re: Re: Re: Re: Re: Re:

                    You seem to be under the mistaken impression that if a company pulls out of a country due to it not being profitable enough for them to operate there that no-one will step up to replace them. This is glaringly false, companies, both local and foreign would be chomping at the bit to enter a market with the demand side already filled, and the supply side recently vacated, as they'd make an absolute killing.

                    Doesn't that kind of depend on the capability of the entrants. I agree that products would be replaced but with the same quality and diversity? And should quality products be forced to withdraw from third world markets solely to prevent reimportation competition from undercutting their higher margin markets? How does that make any sense?

                     

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                      That One Guy (profile), Sep 20th, 2012 @ 8:07pm

                      Re: Re: Re: Re: Re: Re: Re: Re: Re:

                      Same quality? Perhaps, perhaps not. However, as soon as the higher quality product gets pulled from the market, the second best one automatically jumps to the 'best quality' spot. It may or may not be as good, but it's the best available, which is all that matters.

                      As to the second half, it may be brutal, but that's just how the market works, or at least how it should work. You either compete successfully in the market you're in, or you fade away as the more successful do so in your stead.

                      With regards to them making more in one market than the other, the only people who should be caring about that is the company itself, it's not for some outside group to come in and prop them up to make sure they make all the money they think they should be making.

                       

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                      John Fenderson (profile), Sep 21st, 2012 @ 1:03pm

                      Re: Re: Re: Re: Re: Re: Re: Re: Re:

                      I agree that products would be replaced but with the same quality and diversity?


                      For software and music, yes they probably would. In the software world, the products from the big names are easily matched by open source in quality. In music, the same holds true. I don't see why this wouldn't be the case with textbooks (actually, I'd be very surprised if textbooks weren't dramatically improved).

                       

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                        Anonymous Coward, Sep 21st, 2012 @ 2:10pm

                        Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                        Why doesn't that happen now? Maybe people in Mali (for whatever reason) prefer to listen to Lady Gaga than Gorehound's talentless, geriatric punk band "Big Meat Hammer".

                         

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                    JEDIDIAH, Sep 21st, 2012 @ 1:45pm

                    Just exploit the first sale doctrine yourself.

                    You're forgetting the obvious:

                    Import the product from another country.

                    If Big Content doesn't want to authorize something for sale in a particular country then just import it yourself. This is something that ANY individual should be able to do. That it is allowed should be painfully obvious to EVERYONE.

                    The whole "region coding" nonsense is just a power grab for things not granted by law. It's an attempt to use technology to gain those things that the law doesn't really grant.

                    This has been common enough for gray market goods in the past.

                    It simply should never be the case that a publisher can keep a creative work out of a particular country. It's simply a power they should have.

                     

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                  John Fenderson (profile), Sep 21st, 2012 @ 1:00pm

                  Re: Re: Re: Re: Re: Re: Re:

                  It may be tough for substitute drugs, high level software, textbooks and entertainment to fill that void.


                  Excepting drugs, as I don't know enough about that business to comment, the rest of that list is quite easy for small companies to do, especially if the big guys aren't there to compete with you.

                   

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                  John Fenderson (profile), Sep 21st, 2012 @ 1:07pm

                  Re: Re: Re: Re: Re: Re: Re:

                  I doubt anyone will have much incentive to serve impoverished markets if the cost of doing so is being undercut by their own product in high margin markets.


                  I'm not sure what you're saying here. Who says that the new companies would intend to serve any market but the local one? Who says they'd export or import at all?

                   

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                    Anonymous Coward, Sep 21st, 2012 @ 1:54pm

                    Re: Re: Re: Re: Re: Re: Re: Re:

                    I'm not sure what you're saying here. Who says that the new companies would intend to serve any market but the local one? Who says they'd export or import at all?

                    In our textbook case, I think it very unlikely that a local third world company will be able to replicate the quality of the US textbook at a price anywhere near what the US book is sold at. The US publisher subsidizes the his third world sales with first world sales. Doubtful a third world text would get any traction in the US market. So how does the third world publisher make it worth his while in an infinitely smaller market with an infinitely smaller per capita income?

                     

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                      Anonymous Coward, Sep 21st, 2012 @ 2:03pm

                      Re: Re: Re: Re: Re: Re: Re: Re: Re:

                      More importantly, why isn't it happening now? What prevents the Royal Mali Publishing Company from publishing a textbook that competes directly against the John Wiley & Sons textbook in Mali and other third world countries in the region?

                       

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                      John Fenderson (profile), Sep 24th, 2012 @ 10:30am

                      Re: Re: Re: Re: Re: Re: Re: Re: Re:

                      In our textbook case, I think it very unlikely that a local third world company will be able to replicate the quality of the US textbook at a price anywhere near what the US book is sold at.


                      I have a hard time seeing how this is true. First, US textbooks tend to be pretty bad, and gradually getting worse. But even if they're great, why would that be hard to replicate?

                      The expensive part of a textbook would be the research -- a task made much easier and very cheap by the internet. Publishing can also be very cheap. The writing takes time and talent -- something that third world countries don't have a particular lack of.

                      The main part I'm not understanding is why you think that a third-world publisher would need to sell their works in an international marketplace. A tiny market can be plenty profitable.

                      The world doesn't need international corporations for this sort of thing. In fact, their existence is these spaces is actively harmful.

                       

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          Ninja (profile), Sep 20th, 2012 @ 11:59am

          Re: Re: Re:

          Yes, they won't sell due to piracy or whatever stupid motive and leave shitloads of money on the table as ppl will still get what they want. MAFIAA stopped selling in Spain but Spain haven't stopped sharing ;)

           

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          BeaverJuicer (profile), Sep 20th, 2012 @ 12:09pm

          Re: Re: Re:

          The inevitable response is that the producer of the good will no longer sell into that market.
          a) Are you really using the "I'm gonna take my ball and go home" approach???

          b) To which the inevitable response is that someone else WILL step in, likely at a lower cost and more innovative approach. Just like another kid went and got another ball when you were a kid.

           

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            Anonymous Coward, Sep 20th, 2012 @ 12:33pm

            Re: Re: Re: Re:

            "The inevitable response is that the producer of the good will no longer sell into that market."

            a) Are you really using the "I'm gonna take my ball and go home" approach???

            I'm just the messenger. It's about what makes business sense.

            b) To which the inevitable response is that someone else WILL step in, likely at a lower cost and more innovative approach. Just like another kid went and got another ball when you were a kid.

            Maybe so. But given the popularity of US movies, music and software and the economies of scale they enjoy and the technical and artistic expertise, I humbly submit that if it was easy to make a market in a poor, third world country- people would already be there. Nigeria and India have a robust and low cost motion picture industries. Why aren't they dominating? Clearly they have much lower costs. My sense is that when the kid with the brand new leather Lebron James edition basketball leaves, no one is really interested in playing with a deflated old dodge ball.

             

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              BeaverJuicer (profile), Sep 20th, 2012 @ 12:42pm

              Re: Re: Re: Re: Re:

              At 10:51am (EDT) you said,
              Just to be clear, the RIAA and MPAA are the trade organizations for the labels and studios, respectively. The labels compete against one another as do the studios. In addition, they compete against the indys, foreign producers and more broadly- others competing to capture the entertainment dollar of consumers.
              but now you say
              But given the popularity of US movies, music and software and the economies of scale they enjoy and the technical and artistic expertise, I humbly submit that if it was easy to make a market in a poor, third world country- people would already be there. Nigeria and India have a robust and low cost motion picture industries.
              So which is it? Are they worried about competition from low cost indies, or are they the sole creators of the content people want?

              If, by your own argument, the MPAA and RIAA members are the sole source of the content, why don't they just up the price, so they aren't undercutting themselves in other pieces of this "global market?"

               

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        Anonymous Coward, Sep 21st, 2012 @ 6:42am

        Re: Re:

        Brilliant, that's what the MPAA and RIAA should do; buy their shiny discs in some backwater country and sell them in the first world. Win win!

         

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      Ninja (profile), Sep 20th, 2012 @ 12:01pm

      Re:

      The problem comes when someone tries to build a business model by doing it on a large scale.

      Point missed, it's about me buying a damn book/cd/whatever for personal use and then wanting to sell it afterwards. There's no such large scale issue.

       

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    Anonymous Coward, Sep 20th, 2012 @ 11:23am

    You bought it, you own it.

     

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    Anonymous Coward, Sep 20th, 2012 @ 11:51am

    Meaning you can place the same value anywhere so there won't be such issues. So your point crumbles down.

    So what if that then means that producers of software, medications, entertainment etc. simply increase prices in third world markets to guard against people reimporting and competing against them with their own product. Who benefits from that?

    Do you honestly believe that US prices will be lowered to preserve a presence in marginally profitable third world markets?

     

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      Mike Masnick (profile), Sep 20th, 2012 @ 11:39pm

      Re:

      So what if that then means that producers of software, medications, entertainment etc. simply increase prices in third world markets to guard against people reimporting and competing against them with their own product. Who benefits from that?

      You seem to assume that producers set prices, rather than markets. So if they increase prices, consumers will go elsewhere, and it will be seen as a stupid move -- allowing competitors to come in at better prices.

       

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        Anonymous Coward, Sep 21st, 2012 @ 4:04am

        Re: Re:

        "So what if that then means that producers of software, medications, entertainment etc. simply increase prices in third world markets to guard against people reimporting and competing against them with their own product. Who benefits from that? "

        You seem to assume that producers set prices, rather than markets. So if they increase prices, consumers will go elsewhere, and it will be seen as a stupid move -- allowing competitors to come in at better prices.

        Where does it end? Why would an eager competitor jump into a low price, low volume, low margin market if doing so will simply allow his product to be reimported into his high margin, high price market to compete against him?

         

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          Ninja (profile), Sep 21st, 2012 @ 4:07am

          Re: Re: Re:

          Srsly, if you make the prices high enough in poorer countries it's pretty simple:

          1- if the goods are not necessary for survival people will simply drop them (or get via other means anyways).
          2- if the goods are needed for survival (ie medicine) the Govt will break the patents and make generic drugs.

          In any case you lose ;)

           

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            Anonymous Coward, Sep 21st, 2012 @ 4:49am

            Re: Re: Re: Re:

            Srsly, if you make the prices high enough in poorer countries it's pretty simple:

            1- if the goods are not necessary for survival people will simply drop them (or get via other means anyways).


            To some extent. But clearly that society as a whole will suffer. In the case of entertainment, software or educational material replacement material will doubtlessly be either of inferior quality or obtained illegally. In either case, distribution will be less robust and the society will be less well served.

            2- if the goods are needed for survival (ie medicine) the Govt will break the patents and make generic drugs.

            What? You're saying that the government of Somalia or the Congo will waive a magic wand and build manufacturing plants and hire scientists and engineers capable of manufacturing pharmaceuticals? How long will that take? How do countries like that recoup the massive investment in the construction and technology required to do that? No outside investor is likely to enter as the limited market would be unattractive- not to mention that legitimate investors would be unlikely to see "breaking patents" as a viable strategy.

            In any case you lose ;)

            No, poor people lose. All because you of some stupid theory that companies should be required to compete against themselves.

             

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              Anonymous Coward, Sep 21st, 2012 @ 6:44am

              Re: Re: Re: Re: Re:

              on point 2; they would import from India instead of Amerikastan

               

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              Anonymous Coward, Sep 21st, 2012 @ 6:59am

              Re: Re: Re: Re: Re:

              And anyone above the powerty line lose. All because you have some stupid theory that companies should be able to force governments to limit markets?

              In regards to generic drugs you are just being silly. Please read up on the Doha declaration etc. Let me give you two hints: profit margins and patents...

              In regards to the necessity. Please make a sensible and specific argument. Blanketing with 4 or 5 general concepts with no apparent relevance. Illegal or inferior quality is the scare tactics of trademark industry. Inferior entertainment is oxymoronic, educational quality is mostly about the internet access today since stupid professors are undermining your business with stupid free reservoirs and open crappy source, while software is basically the same argument as educational material except for professors being substituted by programmers.
              Less robust distribution is probably correct, but as I say: The internet is already becomming the primary distribution-tool in less developed countries and complaining about a lack of rainforest-killers and older technology pushers is not really a good point...

               

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    terry (profile), Sep 20th, 2012 @ 11:58am

    No Hope For 'Em!

    With improved methods of transportation for raw materials, finished goods, and data the marketplace is growing more global all the time. We are talking about a company that has made profits from a sale although a reduced amount, made a profit nonetheless or they wouldn't have bothered. That product is then repurchased, transported and resold again.

    If owning the brand name, being the source, the company can't compete selling identical products in the marketplace against a reselling competitor who is dealing with three price markups of which the money for the entire first sum went to them then they are just doomed to fail anyhow and no amount of government granted monopoly is likely to save them.

     

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    Ninja (profile), Sep 20th, 2012 @ 12:03pm

    Man, how the fuck trolls twisted the whole thing of selling something you bought for personal use in another country to massive organized crime business?

    Can we please get back to the point and agree that selling something you bought for personal use in another country should be subjected to the first sale doctrine because it's the damn sane thing to do?

     

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      Anonymous Coward, Sep 20th, 2012 @ 12:37pm

      Re:

      Again numbnuts, that is not what Kirtsaeng was doing. This discussion would be easier if you knew what you were talking about.

       

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        The eejit (profile), Sep 20th, 2012 @ 12:51pm

        Re: Re:

        Even then, the point still applies: provided all other laws have been complied with, why shouldn't the guy buy the damn textbooks elsewhere if it allows him to concentrate more on, y'know, teaching?

         

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          Anonymous Coward, Sep 20th, 2012 @ 1:01pm

          Re: Re: Re:

          I'm kind of surprised that you'd pick up where this idiot left off. Presumably Wiley lowered prices in poorer countries to sell more textbooks into a lower per capita income market. Kirtsaeng bought up books in that market and undercut distributors of Wiley's books in the US. What Wiley is likely to do is simply say "fuck it" we'll only sell books in the most lucrative markets if the consequence of selling in poor countries is that our books are reimported and used to compete against us in the US market.

           

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            Anonymous Coward, Sep 20th, 2012 @ 1:37pm

            Re: Re: Re: Re:

            As someone outside the US I would say, "yes please, kiss me darling!". It might mean new books making it in as a standard and maybe, only maybe a slight decline in quality. But ultimately my point is that textbooks are far less relevant when computers and the internet exists!

             

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            The eejit (profile), Sep 21st, 2012 @ 12:33am

            Re: Re: Re: Re:

            Again, that's not necessarily a bad thing: Perhaps we can reduce the coists of education to governments wlsewhere, meaning more monies freed up for other things that government need, like infrastructure.

            Your argument is still flawed.

             

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        Ninja (profile), Sep 21st, 2012 @ 4:05am

        Re: Re:

        We don't know. And you are focusing on a single case when the majority is not even remotely close to it. There are mechanisms to prevent larger scale operations (and mind you I'm still not considering it to be large scale) without trampling with the rights of the absolutely great majority of the population (as in 99,999999% of the population). But no, let us crush the small ant with a nuclear bomb, seems reasonable.

        Are you that clueless in reality or you are just trolling on purpose?

         

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          Anonymous Coward, Sep 21st, 2012 @ 5:10am

          Re: Re: Re:

          We don't know. And you are focusing on a single case when the majority is not even remotely close to it. There are mechanisms to prevent larger scale operations (and mind you I'm still not considering it to be large scale) without trampling with the rights of the absolutely great majority of the population (as in 99,999999% of the population). But no, let us crush the small ant with a nuclear bomb, seems reasonable.

          Are you that clueless in reality or you are just trolling on purpose?


          Apparently you continue to refuse to read up on the facts of the case so as to preserve your own stupid argument. If Kirtsaeng prevails what "mechanism to prevent larger scale operations" exist? None. Look at the situation in Post 136 below:

          Textbooks and their pricing are one of the biggest scams ever.

          As an example, I teach engineering at a university in Asia. The text I used last semester had a US price of $263. While the exact same text, with a soft cover stamped "NOT FOR SALE IN USA", was purchased by the school and sold to students for $36.

          Exact same text, illustrations and mistakes. Looking inside it even states that it was printed in the good ol' US of A.

          So if the publishing houses can do that sort of pricing for the overseas market, why couldn't they do it for me when I was paying $3000 a term for my books o' so many moons ago...


          If Kirtsaeng prevails, I can purchase these textbooks for $36 and reimport them into the US. In the US they retail for $263. I can make a killing selling them for $163- a full $100 less than retail, but $127 more than I paid.

          If that is allowed, how long do you think the publisher will sell that textbook in Asia for $36? He'll either raise the price to make reimportation into the US not worthwhile, or simply withdraw from the market. He will not cannibalize his own margins in the US for the purpose of selling $36 textbooks in a much smaller Asian market. Why would he?

          Finally, your accusation of cluelessness is laughable. At issue is a decision with major implications in the real world. That is why the Supreme Court took it on.
          And this business of labeling everyone you disagree with as a troll is infantile, though not unexpected from someone some hopeless unable to defend their point of view.

           

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            Anonymous Coward, Sep 21st, 2012 @ 10:45am

            Re: Re: Re: Re:

            As soon as the publisher recoups expenses the cost per book drops to next to nothing. So I don't get all the hand wringing.

             

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              Anonymous Coward, Sep 21st, 2012 @ 10:47am

              Re: Re: Re: Re: Re:

              also, you can bet your ass that if they are selling the text for $39.99 or whatever, in a foreign market they are making a profit on it so they are screwing the US market.

               

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    Anonymous Coward, Sep 20th, 2012 @ 12:18pm

    Theoretical Isolated Markets

    If your "market" is no longer an isolated one then your control on pricing adjusts to what the market itself will bear regardless of what you want the price to be. Attempting to create artificial barriers that enforce these 'walled off' market segments is a short term solution at best. The fact that implementing them with laws guarantees that it will have negative impacts across the board as well. We are living in a global economy and the market is no longer a single country with physical borders being the market limitations. Modern technology has created a situation where those borders are a negligible hindrance. If the *AA (or other corporations) cannot adapt to that fact then they will end up being replaced. It's exceedingly simple. *shrug*

     

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    Corby (profile), Sep 20th, 2012 @ 12:21pm

    "It appears that the RIAA and MPAA are pretty scared about this possibility. They've filed quite the amicus brief in the case claiming that buying goods overseas and selling them in the US is the equivalent of piracy. No joke:"

    Well in that case the RIAA and MPAA should start bribing the US government to ban all countries imports and trades with the US from entering the country to be sold. They should also bribe the US government to create an internet wall of US and ban all non US websites from being accessed too. This should stop people importing goods into the US to be sold and therefore no more piracy.

    This of course will never happen because if the US created a great internet wall of US and stopped all imports and trades then there will be lots of jobs destroyed and the US economy will totally suffer.

     

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      That One Guy (profile), Sep 20th, 2012 @ 5:07pm

      Re:

      Okay, this line got a laugh out of me:

      'the RIAA and MPAA should start bribing the US government'

      Start bribing the US government? They never stopped.

      That said I do get the point you're trying to make, and I'm sure they are leaning heavily on their bought and paid for officials and doing their best to get this case to go their way.

       

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    gorehound (profile), Sep 20th, 2012 @ 12:31pm

    I really hate the RIAA & MPAA.I am so sick of these A-Holes.
    Please someone with moire brains than me hack them and release their dirty laundry for the whole world to see.

     

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    Andrew (profile), Sep 20th, 2012 @ 12:32pm

    In the RIAA and MPAA's defence, Techdirt did recently write about the Copyright Act explicitly saying that disruptive innovation should be blocked.

    Although if arbitrage is "theft", which I assume is what's being implied here, does that mean I could get ICE to shut down the iTunes store in the US as tracks there are around 25% cheaper than in the UK? Surely iTunes has to be the biggest music piracy site out there by far.

     

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      Anonymous Coward, Sep 20th, 2012 @ 1:19pm

      Re:

      iTunes and the record companies have already struck deals on sale. They have both been investigated for price fixing several times. Right now a suit is running on eBooks in USA and EU has pricefixing on eBooks and eMusic on their active investigation roster.
      It would seem that the arbitrage in this case is in the agreement between iTunes and the publishers!

      If we assume that it is possible to make a computer believe that you are in another country, there is a also the possibility for third party prividers to create their own arbitrage market inside iTunes itself! Point is: Believing in and wanting a full separation of countries on the internet is the whole point of the business-model RIAA and MPAA are fighting vehemently for.

      There is no spoon, people!

       

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    Anonymous Coward, Sep 20th, 2012 @ 12:43pm

    But of course...

    They would know. They are the experts at destroying economies.

     

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    Anonymous Coward, Sep 20th, 2012 @ 1:07pm

    Isn't this pretty much the same argument they bring against used goods markets to try to undermind first sale too?

     

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    Jeffrey Nonken (profile), Sep 20th, 2012 @ 1:23pm

    As I've mentioned before, I once bought a Region 2 DVD from Amazon (new, not used) because the movie in question is not and has never been available on DVD in Region 1, period, full stop.

    I suppose a delayed release could be argued, but 20 years seems a bit excessive.

    I should add that I then ripped the DVD so I could play it on my laptop (without having to use up a Region setting on the laptop's DVD drive). And no, I've not shared the DVD.

    Obviously I'm a filthy pirate who has cheated the movie studio out of billions of dollars by purchasing the DVD outside its intended market.

     

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    Anonymous Coward, Sep 20th, 2012 @ 2:06pm

    Save us from ourselves!

    Hmmm. The usual argument for huge protectionist tariffs (lets call it what it is) is that the economy will collapse unless we protect domestic producers from being undercut by cheaper foreign competition. In this case we are being implored to protect domestic producers from having to compete with cheaper goods from...themselves. Right.

    How dare we import something from overseas where it's available at a lower price. Artificial scarcity --> artificial markets --> artificial prices.

     

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      Anonymous Coward, Sep 20th, 2012 @ 2:34pm

      Re: Save us from ourselves!

      Again, would you prefer that the price be the same in the third world as the first world? Who does that benefit? I think what you really want is the third world price in the first world.

       

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        Anonymous Coward, Sep 20th, 2012 @ 3:06pm

        Re: Re: Save us from ourselves!

        "Again, would you prefer that the price be the same in the third world as the first world? Who does that benefit? I think what you really want is the third world price in the first world."

        I would prefer that prices everywhere were set fairly by supply and demand in free markets without artificial barriers whose sole purpose is to extract higher profits without providing more value. Prices would likely still be somewhat higher in wealthier countries where the demand and disposable income are greater.

        Who does that benefit? Everybody who is currently paying artificially inflated prices. If they can sell it at the "third world price" and still make money (and it's a bald faced lie that they are selling at a loss anywhere) then why should we tolerate "first world pricing"? What other industry gets to do that?

         

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          Anonymous Coward, Sep 20th, 2012 @ 3:21pm

          Re: Re: Re: Save us from ourselves!

          What artificial barriers are you talking about? The intersection of the supply and demand curves is at a very different price in a third world country than the US. Given the smaller size of the third world market it is hard to imagine that their demand would appreciably lower price of the item. So if you do as you suggest and treat the world as a single market, the third world would be in for much higher pricing than the current regional pricing model affords. And the first world's price would't be dramatically lower either. However, the ability to keep prices low in the third world goes out the window when product allocated to the third world erodes margins in the first world.

           

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            Anonymous Coward, Sep 20th, 2012 @ 3:57pm

            Re: Re: Re: Re: Save us from ourselves!

            What artificial barriers are you talking about?

            I'm talking about using legal barriers to impede the natural flow of goods across borders in order to enforce separation of markets and higher prices than a free market would support.

            The intersection of the supply and demand curves is at a very different price in a third world country than the US.

            Those curves also intersect at quite a different point in say inner city Detroit than in Beverly Hills. Shouldn't the oh-so-altruistic content industries be morally obligated to sell their wares for much lower prices in poor domestic markets too? And if so, should it be illegal for me to go to Detroit, buy a box of cheap DVDs, drive them to California myself and sell them at the higher price? What artificial legal barrier will you erect to prevent me from doing that?

            Companies are not selling at a loss in poor countries out of the goodness of their hearts. They sell at lower (but still profitable) prices to extract that extra bit of revenue they would otherwise miss out on. What about the poor residents of otherwise wealthy countries who cannot afford the first world pricing? Where is your moral concern for them?

             

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              Anonymous Coward, Sep 20th, 2012 @ 4:32pm

              Re: Re: Re: Re: Re: Save us from ourselves!

              Companies are not selling at a loss in poor countries out of the goodness of their hearts. They sell at lower (but still profitable) prices to extract that extra bit of revenue they would otherwise miss out on.

              That might be right. But if it has the effect of cannibalizing their larger profits in high margin markets, how long do you think that will go on?

              My only point in this discussion is if identical, foreign manufactured goods are allowed to be reimported for the purpose of undermining the high margin market- those books, movies, software, music, medicines, etc will simply not be sold or the price will be increased to the point where there's little incentive to reimport.

               

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                Anonymous Coward, Sep 21st, 2012 @ 3:52am

                Re: Re: Re: Re: Re: Re: Save us from ourselves!

                High prices and high margins are not necessarily the same.

                To me the pricing seems to be a scam. Instead of looking at the product you are selling to set a price, you are setting it solely based on "expected value". It is the monopoly market at work and the need for government intervention in this case is created solely by pricing of the monopolist. The level of unfounded assumptions you are setting up to reach the conclusion of the industry being threatened by unfair competitionm is mindblowing.

                 

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                Anonymous Coward, Sep 21st, 2012 @ 10:49am

                Re: Re: Re: Re: Re: Re: Save us from ourselves!

                real issue is why do they need to screw the "high margin" market so bad? Just because they can?

                 

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                  Anonymous Coward, Sep 21st, 2012 @ 12:25pm

                  Re: Re: Re: Re: Re: Re: Re: Save us from ourselves!

                  Which gets to the real issue of all of the opponents. You want to use whatever means to get it cheap.

                  In any market, if a good or service is too high it will attract entrants who want a piece of that market. I assume that barriers to enter the textbook market are fairly high owing to the level of expertise of the authors of the content and the natural limits of the market (students requiring that kind of text) Higher technical medical texts require greater (and more scarce) intellectual inputs and have a smaller potential market than an entry level English comp. text. So if a medical text is $500 and an English text is $50, both are likely not overpriced because if they weren't, new competitors would enter the market.

                   

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    Anonymous Coward, Sep 20th, 2012 @ 2:21pm

    I'm somewhat surprised that I hardly ever see 'Red Baron v. Taito' brought up when it comes to these sort of 'grey market' situations. Both the court and Taito conceded that first sale/exhaustion applied to the original purchase of arcade boards in Japan:

    Summary- http://itlaw.wikia.com/wiki/Red_Baron_v._Taito
    Full text- http://bulk.resource.org/courts.gov/c/F2/883/883.F2d.275.88-1368.html

    'At trial, the district court held that both of Taito’s copyright infringement claims were barred under the “first sale” doctrine, codified in 17 U.S.C. §106(3). In reaching this determination, the court reasoned, “Taito’s initial sale in Japan of the circuit boards for Double Dragon extinguished all rights that it had under copyright laws.”'

    Ultimately, Taito won it's particular case based on the notion that having the arcade machines set up and playing the demo constituted a 'public performance', but forfeiture of the right of distribution WAS upheld under first sale for a foreign made and marketed good.

    Taito argued that the first sale doctrine, although essential to the discussion of Taito’s “right to distribute,” has a separate and distinct application regarding the right to perform publicly.

    In order to enact their legal shenanigan, they had to admit that first sale applied.

    Also the 'public performance' nonsense was overturned by a higher court ruling. Even if it wasn't it still would have been legal to own and use the cabinet according to first sale.

     

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    Darkness, Sep 20th, 2012 @ 2:51pm

    RIAA/MPAA total sales vs us.

    The numbers I just checked said the total business between the *AAs was $32.6B MPAA (world wide) and $7B for 2011.

    Compare that to the computer industry where just apple, microsoft and intel make more then that per quarter. Somebody is backing the wrong horse.

     

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    Anonymous Coward, Sep 20th, 2012 @ 3:17pm

    US economy may collapse?

    Too late!

     

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    Anonymous Coward, Sep 20th, 2012 @ 3:41pm

    So Masnick, you've been curiously absent from the discussion. Let me ask you this. Lets suppose that you have a US based medical textbook business and buy those books from the publisher for $100 each. You sell 10,000 to medical students every year for $150. The same publisher sells those books to me in a third world country for $50. Due to the local economy I can sell about 100 books at $60 each. But this year, I ordered 10,000 and set up shop next to you and offered the book for $100. You can't compete because I'm selling at your cost. The publisher gets $50 less for each of those 10,000 textbooks. This is competition? This is sustainable.

    Now assume that it is a global "free market". How much of an affect on price is the demand for an additional 100 books? C'mon, you have an MBA. Tell us how this is a viable model?

     

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      Anonymous Coward, Sep 20th, 2012 @ 6:28pm

      Re:

      It is a company teeing up unfair competition between two subsidiaries. For some reason they are not charging the same for the product even though it is produced the same place and they are identical (I assume those are prerequirement for the thought-experiment. Reality is very different, but it is irrelevant.). Now, for some completely inexplicable reason subsidiary 1 finds out that subsidiary 2 is getting the book cheaper from you, probably because of the subsidiaries meeting.

      Now your analogy is taken in a completely different and less logical direction, but if I understand the situation correctly you will not see subsidiary 2 contacting you, but instead subsidiary 1 will show up at your office furious and insists on renegotiating your deal.
      In my scenario subsidiary 1 will initiate a meeting with you to reduce prices and subsidiary 2 will not renegotiate anything. Now tell me how likely this situation is? Also, my question to you is: Why discriminate to begin with? We are in the 21st century and slaves are distant past while even LGBT have almost equal rights!

       

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      Ninja (profile), Sep 21st, 2012 @ 3:47am

      Re:

      Read the rest of the comments, you are missing the point. It's first sale doctrine, not some massive scale operation. Also, Mike was traveling yesterday, mr troll ;)

       

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        JEDIDIAH, Sep 21st, 2012 @ 1:51pm

        Just say no to artistic megalomania.

        The scale of the operation is entirely irrelevant.

        It's like the GPL. My personal property rights are no different than IBMs. If I can resell something then so can IBM. The fact that this upsets some other big corporation is entirely irrelevant.

        Their artistic megalomania should not override my property rights. Period.

         

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  •  
    identicon
    Anonymous Coward, Sep 20th, 2012 @ 4:34pm

    Textbooks and their pricing are one of the biggest scams ever.

    As an example, I teach engineering at a university in Asia. The text I used last semester had a US price of $263. While the exact same text, with a soft cover stamped "NOT FOR SALE IN USA", was purchased by the school and sold to students for $36.

    Exact same text, illustrations and mistakes. Looking inside it even states that it was printed in the good ol' US of A.

    So if the publishing houses can do that sort of pricing for the overseas market, why couldn't they do it for me when I was paying $3000 a term for my books o' so many moons ago...

     

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      identicon
      Anonymous Coward, Sep 21st, 2012 @ 1:11pm

      Re:

      no wonder my books cost so much -.-

      the worse is when they make new editions every year by changing a small thing

      then the students are scared to buy last year's book second hand

       

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    identicon
    Michael, Sep 20th, 2012 @ 4:58pm

    Whats the problem?

    So the economy collapses... whats wrong with that? Should have happened decades ago.

     

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    Howard Waller, Sep 20th, 2012 @ 6:26pm

    RIAA & MPAA

    Wow, this could impact the entire economy? How? A few schlemiels in the industry can't buy a new Lamborghini and we're going to have a collapse? Screw those clowns! Maybe they should get real jobs instead of leeching off people who have real talent.

     

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    DataShade (profile), Sep 20th, 2012 @ 9:01pm

    I hate working overnights, because I'm always so late to these conversations.

    If anyone's still paying attention: the copyright corps want to call this piracy because it really is piracy, in the sense that piracy is the way you undermine mercantilism by turning it against itself. I'd like to draw your attention to this blog/opinion article from around the time of the financial crash in 2008:

    We Are All Mercantilists Now

     

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    identicon
    Rekrul, Sep 21st, 2012 @ 1:16am

    Considering the many incredibly bad rulings the Supreme Court has made in the last few years, I fully expect them to roll over and give the RIAA/MPAA everything they want.

     

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    identicon
    flubaluba, Sep 21st, 2012 @ 3:41am

    UK

    What we really need is for artists to have a way to be paid through a system like paypal(but not paypal), where anyone needing to pay to use music goes to a site fills out a form and transfers money directly to an artists account.
    Why should there be a middle man. Maybe have the collection society to investigate whether people are not paying or getting a licence to play the music they want to play. If an artist wants to use the collection society then they pay a certain percentage recouped from businesses not paying for using a registered artists music.
    A very low percentage , or even have the business using music illegally have to pay costs to the collection society.

    Control of the music needs to be returned to the artists, the world is a much smaller place where anyone anywhere can sell to someone around the world with almost no cost to themselves.

    Artists do not need collection societies any more, or if they do they need them to concentrate on resolving problems with studios and big businesses trying to take advantage of artists.

    The old system is collapsing and they are doing anything they can to stay relevant , this is why they are doing this , trying to make sure they have control over every sale in America.

     

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    magusat999 (profile), Sep 21st, 2012 @ 8:34am

    So how much is it really worth???

    This case raises a question - if they can sell it at lower prices in different markets - how much is it really worth? They purport that their bottom line is protecting their ability to make a profit - so they MUST be making a profit in foreign markets where they are selling items at a fraction of the cost they are selling the exact same products to Americans; so if they can make a profit on 2.00, how are they justifying the 20.00 we have to pay - on a DOMESTIC PRODUCT, no less???

    It sounds more like they want the right to continue to rip off every American. They also seem to want the right to make a profit from non-retail sales, it may not come up in this case, but that's the next logical move. They are encroaching on our right to liberty, freedom and preservation of the American way - I hope the Supreme Court looks deeply into this, as it is affecting more than just copyright.Its heading into Marxism territory...

     

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      identicon
      Anonymous Coward, Sep 21st, 2012 @ 12:57pm

      Re: So how much is it really worth???

      You really don't understand how prices are set do you? If a price rises to a certain level, new competitors enter the market and drive the price back down. Producers have to be concerned about substitutes for their product. If the price of jumbo shrimp rise drastically, people will substitute lobster. If one producer increases the price of Grade A wheat, he will lose market share until his price comes back into line. Brand loyalty and popularity is also a factor. Why do you think Apple products are so expensive? They are perceived as hip and cutting edge and have a dedicated following. Hell, there was a perfume that advertised itself as "the most expensive perfume in the world". In that case, high price was seen as the advantage.

      Capitalism is a brutally efficient system. I'd argue that in voluntary free and accessible markets are are few true "rip-offs".

       

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    identicon
    Anonymous Coward, Sep 21st, 2012 @ 12:35pm

    Mike I've got a song for you.

    Fifteen men on a dead man's chest
    Yo ho ho and a bottle of rum
    Drink and the devil had done for the rest
    Yo ho ho and a bottle of rum.
    The mate was fixed by the bosun's pike
    The bosun brained with a marlinspike
    And cookey's throat was marked belike
    It had been gripped by fingers ten;
    And there they lay, all good dead men
    Like break o'day in a boozing ken.
    Yo ho ho and a bottle of rum.

     

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      identicon
      Anonymous Coward, Sep 21st, 2012 @ 12:41pm

      Re:

      +1 funny. But be prepared for the onslaught of censorship by Pirate Mike's flock of parrots. I'll bet at least one pinhead tasks you for "pirating" those lyrics.

       

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      •  
        identicon
        Anonymous Coward, Sep 21st, 2012 @ 2:38pm

        Re: Re:

        If this article had anything to do with piracy and copyright enforcement you might have had a point alluding to "Pirate Mike".

        But it's not. So you don't.

         

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        •  
          identicon
          Anonymous Coward, Sep 21st, 2012 @ 3:16pm

          Re: Re: Re:

          So he manages not to cry about copyright enforcement (instead crying about another form of IP protection) or extol the virtues of infringers in a single article and all of a sudden he isn't Pirate Mike any more? That's like saying that because you managed a single post without saying something stupid, that you not still an idiot. You are, and this post didn't break the string either.

           

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            identicon
            Anonymous Coward, Sep 21st, 2012 @ 4:11pm

            Re: Re: Re: Re:

            So in other words, you're arguing for the right to ad hominem and derail the conversation regardless of relevance on the matter, and insult anyone who calls you out on it.

            You epitomise what the RIAA and MPAA consistently feel about the people that might otherwise have been their consumers: regardless of whether you purchased, pirated, or happened to pass by a radio that may or may not have been playing Top 20 content, you're a filthy pirate. Have some harsh laws and settlement threats while you're at it.

            How you consider the above to be reasonable, rational or otherwise even acceptable is beyond most people.

             

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              identicon
              Anonymous Coward, Sep 21st, 2012 @ 4:24pm

              Re: Re: Re: Re: Re:

              Has anyone else remarked about what a thin-skinned, pantywaist you are?

               

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                identicon
                Anonymous Coward, Sep 21st, 2012 @ 5:36pm

                Re: Re: Re: Re: Re: Re:

                You and your ilk feel the need to allude to Masnick's alleged piracy on just about every single article regardless of relevance, insult everyone else as a pirate when this is pointed out - and I'm the thin-skinned pantywaist?

                Brilliant argumentation. It's clearly the high courts treatment for you and low courts treatment for everyone else.

                 

                reply to this | link to this | view in chronology ]


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