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Music Media The Almighty Buck Your Rights Online

UK Music Industry Stomps on Imported CD Seller 404

Posted by michael from the no-price-arbitrage-for-you dept.
MungoBBQ writes "The Independent is one among the many news sources reporting that BPI, the British equivalent of RIAA, has made a large online retailer of CDs, DVDs and games, comply with their demands to raise prices by 2 pounds per CD sold on their website. The retailer, CD-WOW, based in Hong-Kong, agreed to raise their prices offered to their UK customers to avoid legal battles. CD-WOW caters to many other European countries, where people have been enjoying their cheaper CD prices. However, it can now be assumed that other national recording industry organizations will make CD-WOW and other online retailers jack up their prices to 'better compare' with the local prices in each country."
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UK Music Industry Stomps on Imported CD Seller More

UK Music Industry Stomps on Imported CD Seller

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  • It's their lot in life, they're made to suffer (Score:5, Funny)

    by ackthpt ( 218170 ) * on Thursday January 22, 2004 @10:10AM (#8054767) Homepage Journal
    It's because they're selling to british and the british are meant to suffer. It's their lot. Stiff upper lip and all that!

    Bloke: "I am really enjoying this CD I saved 2 quid on!"
    BPI Barrister: "Stop that! Stop that right now! You're not supposed to be enjoying or saving on anything, and where is the rain? Bloody hell, can't we have some respectable english weather?!?"

    Actually, I do buy books from the UK on occasion because they have better covers on the Terry Pratchett books and some things you just can't get in the USA (Meijers/Costco mentality, lots of what you oughta like at prices you can't refuse, but less variety all the time, because variety is meant to be a luxury and should be expensive or denied to peasants just for good measure.)

    • Re:It's their lot in life, they're made to suffer (Score:5, Interesting)

      by nicky_d ( 92174 ) on Thursday January 22, 2004 @10:52AM (#8055215) Homepage

      It's because they're selling to british and the british are meant to suffer.

      We surely are. As an example, I recently sought to nab the 3rd and 4th MST3K [scifi.com] box sets. So to start with, not available in the UK. I shop around, find a good deal on Amazon for the pair, and send off. Now, importing into the UK is an absolutely random gamble - your package may or may not be checked and subjected to extra duty. Mine was - an extra 13 on top, split between Customs and the Royal Mail. But it's not all bad - the total price was still less than the other vendors, and way less than I would have been expected to pay if there was a UK release. Our prices are generally ridiculous for DVDs and CDs - there has been some improvement of late, but price cuts are generally led by major chains who can afford the risk, leaving smaller independent stores in an unfortunate position. If I think an independent store is worth supporting, I'll happily do so - but I won''t fork cash out to high-street chains when I can get the same product much cheaper online (though the online store is probably a subsidiary of the bricks-and-mortar one) and I won't buy British when I can buy American (or even better, Chinese) for far less. It's not like I'm helping kill off master British craftsmen - just a few corpulent CEOs. And while I might contribute to a salesperson begin surplus to requirements, I'll also be contributing to the demand for postal workers...

      • As a general rule, you can import anything under the value of eighteen GB pounds, and be exempt from both VAT and import duty.

        The thing that got me, when importing some CDs from Tower Records in the US, before I realised I would get slapped with an import tax bill, is that they add the duty to the price of the items, and then add the VAT to the items + duty price. A tax on the duty tax! Incredible.

        • The thing that got me, when importing some CDs from Tower Records in the US, before I realised I would get slapped with an import tax bill, is that they add the duty to the price of the items, and then add the VAT to the items + duty price. A tax on the duty tax! Incredible.

          I have to agree that this tax-on-tax business is commonplace among governments and completely unjustifiable.

          I suspect that in the long run that people in the UK will use e-mail to make person-to-person contacts with people (
    • The Canadian editions of Pratchett's books are identical to the British editions; it might prove less expensive for you to purchase from Canada instead. ;3

  • How about offering 2 pounds off to UK customers? (Score:5, Interesting)

    by MImeKillEr ( 445828 ) on Thursday January 22, 2004 @10:11AM (#8054781) Homepage Journal
    Or did they cover that already?

    Sure, charge 'em 2 pounds more, then offer a 2 pound instant savings for customers in the UK.

    F the BPI and the RIAA.
    • The reason the CDs were cheaper was because of where they were being bought from. The CDs were being bought from Asia, where they sell cheaper, and then being sold in Europe. The music industry wanted them to buy the CDs from Europe. Rather than fight it out in court, the store agreed with the music industry's demands and started buying the CDs from Europe. The 2 pound increase in price is simply passing along the increased costs to the customers.

      • Re:How about offering 2 pounds off to UK customers (Score:5, Insightful)

        by ePhil_One ( 634771 ) on Thursday January 22, 2004 @10:34AM (#8055031) Journal
        And this sort of behavior is exactly why the music industry is suffering so; it has little to do with P2P and other things.

        In 1995, the music industry decided to combat price wars in CD sales by setting MAP (minimum advertised prices). Within 6 months, CD sales flattened and began to fall, a did not recover until Napster, MP3 players, etc, revived the industry. The music industry attempts to control the consumer like no other industry, and as a result has missed out on the growth that similar industries have seen, such as Movies and video games. They pay for placement on the radio, pay for placement on store shelves, pay to create videos that they likely pay to have MTV play (all 10 that get played in a 24 hour period). And then they bitch that it cost too much money to create, and thats why they are losing money selling 50 cents worth of metalized plastic for $20.

      • What's to fight out? There's nothing wrong with parallel importing. The worst the Evil Empire could do is threaten to stop supplying them in Hong Kong.

        Funnily enough, that's exactly what happened here in New Zealand with DVDs and independant DVD rental outlets...
      • "The reason the CDs were cheaper was because of where they were being bought from. The CDs were being bought from Asia, where they sell cheaper, and then being sold in Europe."

        Ok...so, companies/corporations don't like it when 'globalization' bites them in the ass, eh? Its perfectly ok for them to move jobs from higher paying countries to lower paying ones...leaving the previous workers high at dry..

        But, let someone start selling products (CD's) from the cheaper parts of the world....and they don't like

  • "Hong Kong-based"?!? (Score:3, Insightful)

    by fuzzybunny ( 112938 ) on Thursday January 22, 2004 @10:12AM (#8054785) Homepage Journal
    Err...what on god's green earth do British courts have to say about a Hong Kong enterprise?
    • They're undercutting the national institution's prices. The british courts can decide that someone needs to charge more for goods to make it fairer on the existing institution, or disallow them to import things to the UK. The british courts don't mind if the HK seller sells CDs for .29, as long as they're not for import in the UK. A sort of corn law type of thing, if you will.
      • That's not my point.

        What I'm trying to get at is that a court only has jurisdiction over a commercial enterprise which is a legal entity in the same country.

        If WoW has a UK division, tough for them. But if they do their shopping in Hong Kong and send directly to customers in the UK, there's not much the BPI could do about it.

        On the other hand, they probably ship in bulk to the UK and then distribute locally to safe on mailing costs.
        • If WoW has a UK division, tough for them. But if they do their shopping in Hong Kong and send directly to customers in the UK, there's not much the BPI could do about it.

          They can lobby for any CD-shaped package from Hong Kong to be seized and destroyed by UK Customs, which seems to be what they are threatening.

    • It never went to court. This was an out-of-court settlement, presumably with the UK Arm of the company. Those of us who buy from CD-WOW are hoping the German (.net) and HK (.hk) sites don't get hit with the same restictions.

      CD-Wow probably pissed off the BPI because they have a section "Unsigned - as yet" which sells CDs from as-yet-unknown bands, which doesn't make any money for the big labels. [Gratuitous plug - look at 'Bridgefield' in this section - they're friends of mine, and think CD-Wow are great

    • Re:"Hong Kong-based"?!? (Score:3, Insightful)

      by smcv ( 529383 )

      From the article:

      CD Wow! faced an injunction after the BPI claimed it was infringing the copyright of its members by sourcing its goods from outside Europe.

      (I don't think that should be possible, though... how can CD Wow be infringing copyright if they have nothing to do with the copying process used to make the CDs, but just buy and resell them?)

      • (I don't think that should be possible, though... how can CD Wow be infringing copyright if they have nothing to do with the copying process used to make the CDs, but just buy and resell them?)

        I think it is because copyright law gives the holder final say over how their work may be distributed. For the first (and possibly last) time in my life - is there a lawyer in the house?

        Best wishes,
        Mike.

    • complex.

      [ob disclaimer: I had this explained convincingly to me by an EFF lawyer for the case of HKFlicks, which applies to US laws, not UK]

      The law says that the copyright holder gets to control how copyrighted items are imported. You and I can still bring in for personal consumption, but not sale (tho we may need to pay duties on it if is new). Even if you bought the Kung Fu DVDs legally in Asia, you could not import them for resale into the US w/o asking the producers permission.

      So the copyright hold
      • It comes down to the question of "where does the transaction take place?", which will be meaningful all over the Internet.

        If I'm in Florida and buy something over the Internet from a store whose sole physical presence is in Oregon, did the purchase take place in Oregon? My credit card was certainly charged in Oregon, as surely as if I were there in person to hand it over to be swiped... The same would be true if I were in the UK buying from an HK website. Once purchased, the CD is my property so, would I

  • Nice one BPI! (Score:5, Insightful)

    by phaze3000 ( 204500 ) on Thursday January 22, 2004 @10:12AM (#8054786) Homepage
    Well done to the BPI for giving those who download music for free yet more reason to not feel guilty. Truly a great day for record companies..

    • WTF - MOD PARENT UP !!! (Score:5, Insightful)

      by maharg ( 182366 ) on Thursday January 22, 2004 @10:20AM (#8054894) Homepage Journal
      If I understand what phaze3000 is saying, why the hell should people feel that downloading music for free is wrong when the legal system allows a large institution like BPI/**AA to *force* (read "bully") legit cd retailers into anti-competitive price rises. Anyone agree ?
      • Anyone agree ?

        It doesn't take a college education or anything more than the old saw of "two wrongs don't make a right" to shoot down the obvious flaw in your reasoning. That said, fallacy and all, I still don't (never did) have any sympathy for the record companies who wage war against their own customers.

        This was more of a an import tariff than a tax, coerced through extralegislative channels regardless (hey I just coined a new word). Either way mind you, all this will do is simply chase more people i

        • Two Wrongs Can Make A Right (Score:5, Insightful)

          by FreeUser ( 11483 ) on Thursday January 22, 2004 @11:40AM (#8055901)
          It doesn't take a college education or anything more than the old saw of "two wrongs don't make a right" to shoot down the obvious flaw in your reasoning.

          Two wrongs can most certainly make a right.

          If someone is attempting to kill you and your family (a wrong), you are certainly justified in killing them (a second wrong), resulting in the survival of you and your family (a right).

          In this case, the recording companies have been screwing artists and engaging in anti-competative trade practices like the one outlined in this article (a plethora of wrongs). If file swappers can put the recording companies out of business by illegally downloading music (another wrong), then a new mechanism for artists to reach their fans will have to emerge. It is very unlikely such a mechanism will be any worse for the artist than what currently exists, and a strong liklihood it will in fact be much better (this would be a "right").

          All of that having been said, I really wish people didn't trade files illegally. P2P technology is IMHO critical to the future of the internet in terms of scalability. The internet itself is fundamentally P2P in its design, and when it comes to downloading Linux ISOs, or legitimate, free media (home movies, machinima animations, popular slashdot stories) having a P2P infrastructure in place will be invaluable. Every illegal download puts amunition in the guns of those who would ban such technologies and change the Internet from a fundamentally P2P medium, where we are all equally empowered to server content as well as consume it, to a top down glorified shopping network/cable channel.

          And that is a disservice to all of us who value our freedom of expression.

          So, ironically, while I disagree with your reasoning, I share your desire for this illegal file trading to stop, so that the rest of us don't have our rights and ability to trade files legally crippled and perhaps one day even revoked altogether ("trusted computing," "palladiium", super-DMCA, SCO-Law, etc. ad nauseum).
      • When people see the "system" is unfair then they feel the need to rise against that system.

        "Why should I follow a corrupt and unfair system?"
      • Anyone agree?

        Absolutely. People discuss these issues in moral terms, but from my point of view there is no morality about it. The record companies are as much in the wrong as the "file swappers" are.

  • Wow is right (Score:3, Funny)

    by shystershep ( 643874 ) * <bdshepherd@gma[ ]com ['il.' in gap]> on Thursday January 22, 2004 @10:13AM (#8054792) Homepage Journal
    We're not acknowledging that we were in the wrong, but simply that the risk-reward ratio of spending months in court wasn't right for us.

    Yay. Chalk up another win for the good guys. It is nice to see, however, that the US legal system isn't the only one where extortion is a valid tactic.

    • Yay. Chalk up another win for the good guys. It is nice to see, however, that the US legal system isn't the only one where extortion is a valid tactic.

      Surely this would fall under RICO in the US?

      IIRC, there was a similar battle between supermarkets and the music industry here in the UK a few years ago. They used to import CDs from European distributers and sell them in the UK for a cheaper price. The industry tried to combat this in two ways. First, they added "bonus" tracks to the UK one to make the ve

      • Surely this would fall under RICO in the US?

        Of course not, RICO only applies to people who DON'T contribute millions in campaign contributions and lobbying efforts. But then, that's true of most laws.

      • Re:Wow is right (Score:3, Informative)

        by mikerich ( 120257 )
        IIRC, there was a similar battle between supermarkets and the music industry here in the UK a few years ago. They used to import CDs from European distributers and sell them in the UK for a cheaper price. The industry tried to combat this in two ways. First, they added "bonus" tracks to the UK one to make the versions they are selling different to the usual UK release. Japan seems to do this as well.

        They also tried to stop them in the courts. IIRC, they lost. Other industries have done the same thing; so

  • It makes sense, though. (Score:5, Insightful)

    by Wingchild ( 212447 ) <brian.kern@gmail.com> on Thursday January 22, 2004 @10:13AM (#8054802)
    The nature of what's happened is bad, but it also makes sense. Being in Hong Kong, CD-WOW doesn't strictly have to play by the UK's rules and can, in theory, charge whatever they want for the media they are selling. It's the basis of free enterprise, which Hong Kong is sometimes good about. (And to the consternation of the MPAA, sometimes all too good about.)

    So, CD-WOW could, in theory, ignore BPI. BPI, in turn, can make life very very difficult for them through the use of repeated lawsuits (which may fail, but will cost money to defend against), through harassment of people buying their services, and through the use of the same tactics the RIAA employs here against people who don't obtain music how they want you to obtain it.

    It's difficult to fight a legal battle, even one you can win, against an opponent who has the resources of the government to draw on. CD-WOW is probably just protecting their interests by rolling with the punches. Hopefully it'll hurt their sales less than fighting with BPI would hurt their bottom line.
    • And, of course, the publicity they get can lead to an increase in sales that would mitigate the effect of the forced price hike.
    • CD-WOW are a small company and probably can't afford to defencd against these lawsuits.

      The BPI are threatening to go after Play [play.com] and Amazon [amazon.co.uk] next. It'll be interesting to see whether they win so easily against bigger companies who can afford lawyers.

      I'll be particularly gutted if Play are forced to raise their prices. I buy all my DVDs from there.

    • Being in Hong Kong, CD-WOW doesn't strictly have to play by the UK's rules

      They have to abide by international copyright law, and if they don't abide by UK copyright law, then their imports can probably be seized at customs. These CDs are infringing copies, according to CDPA 1988 [hmso.gov.uk]. See section 27, copies commercially imported into an area where an exclusive distribution licence exists are infringing. CD-WOW were claiming that they are private imports for personal use, and that the change of ownership happen

  • At least in the US it is... but I thought that was a basic anti-monopoly legal concept.

    • hehe, sure it is.
      But as long as you admit you did nothing wrong (therefore blocking class action lawsuits) and offer a token settlement, you can price fix as much as you want.

    • Re:Isn't Price fixing by the industry Illegal? (Score:5, Informative)

      by edwdig ( 47888 ) on Thursday January 22, 2004 @10:33AM (#8055025)
      Yes, in the US price fixing is illegal. But if you read the article, in the scope of this story, it isn't price fixing.

      CD-WOW was buying their CDs from Asia, where they are cheaper, and then selling them in Europe. BPI objected to this on the grounds that CD-WOW was violating their copyrights by not buying the CDs from Europe. Rather than fight a long legal battle over copyright issues, CD-WOW decided it would be easier to simply buy the CDs sold to Europeans in Europe than to fight it out. The price increase is due to increased costs for CD-WOW, not due to BPI insisting on them raising prices.

      Yes, we all know that there is price fixing involved in CD sales, and that is what this *really* is about, but the actual case that was going to go to court was one of copyright infringement. CD-WOW was selling CDs for 9 pounds. You'd have to sell a huge number of CDs at that price to pay for lawyers to defend you against music industry lawsuits.

  • How about this? (Score:4, Insightful)

    by little alfalfa ( 21334 ) <cohen.joel@gm[ ].com ['ail' in gap]> on Thursday January 22, 2004 @10:14AM (#8054809)
    How about they LOWER their prices to COMPETE with CD-WOW? Isn't that what economics teaches us? WTF PEOPLE!

  • Imports (Score:5, Insightful)

    by Godeke ( 32895 ) * on Thursday January 22, 2004 @10:14AM (#8054812)
    If the cost of shipping around the world doesn't offset the price charged, then I see no reason why any organization should be allowed to demand a price change. Surely the cost of shipping that CD isn't small. Under the "globalization" of the economy, if you can't produce it locally for a reasonable price, people will import it.

    Why is it that only corporations are supposed to benefit from globalization?

    • Re:Imports (Score:3, Insightful)

      by DAldredge ( 2353 )
      In case you haven't noticed is bad when normal people import cheeper things. Globalization is only ok if it increases company profits.

    • Re:Imports (Score:3, Interesting)

      by Mr. McGibby ( 41471 )
      This is why I get so mad when I hear about jobs moving from the USA and Europe to India and other low-wage countries. We're told by supporters that we should simply do with less like those in India and we would get those jobs. But the truth is that the price of living is ARTIFICIALLY high in the USA and Europe. We don't require higher wages simply because we want more stuff, it's because the price of everything here is higher. And it's higher for no other reason than that companies can charge more here.

    • Re:Imports (Score:4, Insightful)

      by slim ( 1652 ) <.john. .at. .hartnup.net.> on Thursday January 22, 2004 @10:48AM (#8055166) Homepage
      If the cost of shipping around the world doesn't offset the price charged, then I see no reason why any organization should be allowed to demand a price change. Surely the cost of shipping that CD isn't small. Under the "globalization" of the economy, if you can't produce it locally for a reasonable price, people will import it.

      Why is it that only corporations are supposed to benefit from globalization?

      The argument (which I am merely repeating, not endorsing) is this:

      The price of a CD is nothing to do with manufacture. Your money pays for all sorts of things, and a big chunk of that is marketing. TV, radio and press adverts in the UK are paid for by the UK record company, not a global body. Radio "pushers", TV appearances, freebies to reviewers, launch parties, etc. etc. etc. are all paid for by the local record company.

      So if you hear a record on the radio in the UK, then buy the CD on import from Hong Kong, the Hong Kong record company benefits from the UK record company's marketing spend.

      The argument continues that prices are set to suit the local market, and marketing spending is set accordingly.

      So, if you're the BPI -- an organisation whos *remit* is to look after the interests of the British Phonographic Industry -- it's clear that imports are not fair, and toys should be thrown from prams.

      The same argument is trotted out to justify game and DVD territory lockout, staggered movie releases, etc. etc.

      ---

      A few other points:

      (1) UK buyers used to get cheap (to us) CDs from the US Amazon site. That stopped when amazon.co.uk hit the scene, and Amazon US started refusing to ship overseas.

      (2) Big name shops like Virgin Megastore, HMV etc. routinely sell import CDs in the UK, but the BPI have no problem with this because they are usually special editions, boxed sets, rarities etc. sold at a premium (20,30,$100,higher). It's when imports of the *same* product are cheaper that they start to complain

      • Horseshit (Score:3, Insightful)

        by gosand ( 234100 )
        The price of a CD is nothing to do with manufacture. Your money pays for all sorts of things, and a big chunk of that is marketing. TV, radio and press adverts in the UK are paid for by the UK record company, not a global body. Radio "pushers", TV appearances, freebies to reviewers, launch parties, etc. etc. etc. are all paid for by the local record company.

        So by that logic, any CD that is not being actively marketed should be sold at manufacturing cost.

        Does it work like that? Hell no. If anything, th

  • Excellent move... (Score:5, Insightful)

    by heironymouscoward ( 683461 ) <heironymouscowar ... m ['hoo' in gap]> on Thursday January 22, 2004 @10:15AM (#8054826) Journal
    When your product is available on a global basis through illicit channels at near-zero cost, and innovative retailers try to bring their prices down in order to attempt to win back legitimate customers, force them to raise prices artificially and drive customers away.

    Way to go, BPI!

  • capitalism? (Score:3, Insightful)

    by the_rev_matt ( 239420 ) <slashbot@ r e v m att.com> on Thursday January 22, 2004 @10:16AM (#8054831) Homepage
    I just love the "free market" ideologues who suddenly want government intervention when someone manages to effectively compete with them. They have no problem shipping jobs to India to get the best prices, but dammit consumers shouldn't be allowed to SHOP in India to get the best prices! They should be forced to pay our prices and conform to our marketing plans so we can make more money!

    • Re:capitalism? (Score:3, Informative)

      by tarranp ( 676762 )
      The people you are railing against, by definition are not "free-market ideologues."

      No, they are people who demand regulations that are most fovrouble to them in the short term, and allow them to "earn" money hand over fist without having to exert themselves or be efficient.

      This is not and indictment of believers in allowing market forces to set prices for goods and labor, but rather an example of how counterproductive the distortion of markets can be.

      I don't like the R.I.A.A. or analogous organizations o
    • I just love the "free market" ideologues who suddenly want government intervention when someone manages to effectively compete with them.

      The BPI are by definition not free market advocates. Like the RIAA, the MPAA and similar trade bodies, the whole purpose of their existance is to advance the interests of their members. Restricting trade is part of that. They are the equivalent to trades unions.

      [In theory of course. In reality, any organisation only partially exists for what it is set up to achieve: al

  • Market forces (Score:5, Insightful)

    by tiled_rainbows ( 686195 ) on Thursday January 22, 2004 @10:16AM (#8054837) Homepage Journal
    Don't worry. Because, as we all know, the Free Market will always end up providing the best solution for everybody, where consumers can choose the best product at the best price and everything sorts itself out, magically, until we're all rich and free and happy. Or something.

    Honestly, though; first DVD regionalisation, then this. Yeah, maybe the free market would be a good idea, if it actually existed.

    What people refer to as the "free market" currently is better described as a global welfare state for fat guys in suits.
    • global welfare state for fat guys in suits.

      Most of the suits at MY corporation appear pretty fit; a couple of fatties but most aren't. :)

      (We don't screw people, but we also don't care much about our "consumers" as people either. Lets me sleep at night, anyway.)

  • Self interest (Score:5, Insightful)

    by CGP314 ( 672613 ) <CGP AT ColinGregoryPalmer DOT net> on Thursday January 22, 2004 @10:16AM (#8054839) Homepage
    We're not acknowledging that we were in the wrong, but simply that the risk-reward ratio of spending months in court wasn't right for us.

    And there you have it, the real thought behind every business decision.


    --
    In London? Need a Physics Tutor? [colingregorypalmer.net]

    American Weblog in London [colingregorypalmer.net]

  • play.com next? (Score:3, Interesting)

    by KingDaveRa ( 620784 ) on Thursday January 22, 2004 @10:17AM (#8054847) Homepage
    CDWow were buying CDs from outside of the EU, which is what the BPI didn't like. Makes me wonder what they think about play.com? They're based in Jersey, and by the looks import their music from Canada. Their prices are the same as CDWow were, so could go up a few pounds also. If they do, the difference in price between play.com/CDWow and HMV or Virgin will be negligible, and play.com and CDWow are going to suffer as a result. I can understand why the BPI are doing it, seeing as its copyrighted works being transferred in and out of licence areas, but it seems a bit wierd. Its a 'cut off the nose to spite the face' thing. On the one hand they're trying to make us buy more albums, and on the other they're making it more expensive. Maybe they should try making the high-street retailers cut prices a bit more. HMV seem to have two broad price ranges - 5-10 and 15-20. You'll sometimes find the same CD in both price ranges, on opposite sides of the shop. At least the online shops are consistant in their prices, and keep them low no matter what.

    This just strikes me as being a silly idea, considering the current circumstances.

    • The BPI are already going after play.com and looking at initiaing proceedings against Amazon, although I imagine that they might think twice about taking on a company like amazon - I mean, anyone that can patent storing a reference to a credit card number in a text file must have some kind of magical legal powers.

      story at Yahoo [yahoo.com]

    • Re:play.com next? (Score:3, Informative)

      by Arathrael ( 742381 )
      Yes, play.com next. And Amazon.com too possibly. The Guardian [guardian.co.uk] articles on this had this to say:

      The BPI has also launched proceedings against Play.com, a Jersey-based online retailer of CDs, DVDs and video games, which operates on a similar basis. And Amazon.com could be drawn into the row because it sells CDs to UK customers that are not available in this country, undercutting traditional high street retailers. The BPI could argue that they are acting without the consent of UK record companies.

      It's one

    • Re:play.com next? (Score:3, Interesting)

      by Zocalo ( 252965 )
      It looks like Play has already tried to prevent any potential suits by the BPI. I was looking to get an R1 DVD from them and they no longer provide R1 DVDs directly from the www.play.com site, although their US arm based at the www.playusa.com site will apparently still ship to the UK. I assume they have adopted a similar position for music imports too. Whether this will stop the BPI starting a similar action against Play remains to be seen though.

      Way to go BPI! Push even more of your customers into th

    • Re:play.com next? (Score:2, Interesting)

      by samadhi ( 140608 )
      Just out of interest how much does a CD cost in local currency from retail outlets around the world at the moment?

      As KingDaveRa mentions in the parent post the majority of new retail CDs in Britain fall into the 15 - 20 region, which if you translate that into US$ works out to $27.65 - $36.87.

      Just curious as to if we are getting ripped off in the UK or whether it is just us Brits feeling sorry for ourselves again.
    • You've drunk the Kool-Aid. Sorry, but it's true.

      You see, there exist this doctrine known as "First sale", which basically says that even for copyrigthed works, the moment you bougth a copy, that single copy is yours (what a concept!).

      Thus attempts at restricting what a legal buyer can do with his property, such as claiming it's illegal for him to resell that property at any price he choose, to anyone, anywhere in the world, are moot.

      I have no idea what you mean by "being transferred in and out of lice

  • I don't care (Score:5, Interesting)

    by rhadamanthus ( 200665 ) on Thursday January 22, 2004 @10:17AM (#8054848)
    I'm really unconcerned about this. I don't buy CDs anymore. I don't download them from kazaa either. I'm tired of giving a shit about people being screwed by RIAA (et. al.), artists being screwed even worse, etc.


    I'm not getting ripped off anymore. I tell everyone I know to do the same, for all the usual reasons, as I've been doing since I started to get informed on these greedy leeches. But if people wanna keep getting screwed, and the artists don't demand better conditions, I don't feel bad or angry anymore. Only justified in my newfound (albeit limited) apathy.

    ---rhad, who is a little cynical today

  • From the BBC's coverage:

    [...] the company had decided to settle because they were "a small business" and it would be financially "imprudent" for them to try and take the case to the Court of Appeal or the European Court.

    (snip)

    CD-Wow! has more than one million users a month worldwide.

    So are they big, or are they small?

  • What CDWOW should do. (Score:5, Interesting)

    by jotaeleemeese ( 303437 ) on Thursday January 22, 2004 @10:19AM (#8054876) Homepage Journal
    COntact their local authority complaining about price gauging from the part of the EU.

    Let China raise a complaint in the WTO.

    Small companies, and individuals should try top leverage the weight of their goverments in this kind of disputes, specially when clearly the BPI is in the wrong (UK people should not the dissatisfaction with them and perhaps with the corresponding branch of the goverment. This stinks of monopolistic behaviour).
  • They're all about free trade when it makes money for them. As soon as it threatens thier profts... here come the lawyers.

    Since when did anyone have a "right" to not being darwined out of the marketplace.

    Feh.
    • AFAICS, the 'free'(as in not-free) trade movement exists to lower barriers against rich western countries flooding developing economies with the products of our highly automated and heavily subsidised agricultural industry. Got to keep those darkies poor and hungry or who knows what they might get up to ;)

  • Theft (Score:5, Interesting)

    by pubjames ( 468013 ) on Thursday January 22, 2004 @10:22AM (#8054919)
    Personally, I think this extra two pounds we have to pay is theft. How do they justify it? This is cartel price fixing.

    How many millions are the music industry going to rob off UK customers as a result of this action?

    The music industry are theiving b******s, which is why they are so obsessed with telling everyone that it's the public that are the thieves.

  • Clarification (Score:5, Informative)

    by slim ( 1652 ) <.john. .at. .hartnup.net.> on Thursday January 22, 2004 @10:26AM (#8054956) Homepage
    CD-Wow's business model was to sell CDs to the UK market. A typical price for a chart CD in the UK is 15.. 12 if you shop around, 10 if you get one of the special offers from a discount shop such as (my favourite) Fopp.

    CD-Wow was able to undercut these prices to (typically) 8, by importing from Hong Kong or mainland Europe, depending on the product.

    The BPI have alleged that importing from outside the EU is illegal, and decided to prosecute CD-Wow.

    CD-Wow decided to settle out of court, despite maintaining that they were in the right. This is not unusual: small companies can't afford months or years in court. Their agreement was to cease importing from Hong Kong, and only import from the EU.

    My understanding is that their agreement with the BPI is *not* to hike prices by 2 -- their agreement is to only import from the EU, and CD-Wow have stated that this will increase their costs by 2, which will be passed on to the customer.

    I think this could hurt CD-Wow quite badly. At 8, this was the cheapest place a Brit could get new CDs (i.e. recent releases). There's a bricks and mortar music shop on my local high street where I can buy the very latest releases for 10, and have luxuries like browsing the packaging, having the product immediately, eyeing up the hot shop assistant, etc.

    Erm, sorry about that last bit.

    • Re:Clarification (Score:3, Interesting)

      by Rob Parkhill ( 1444 )
      Wow, I would never buy a CD at those prices. I can pick up most CDs locally for under CAD$20, most for under CAD$18 (or about 7.50 to 8.50 pounds.)

      Even at the "we never discount" places in the mall, you hardly ever see a CD over CAD$25.

      15 pounds (CAD$36) for a CD is insane. Then again, people in the UK are used to getting screwed by high prices.

      Maybe you should start ordering from Canadian stores. (absound.ca, amazon.ca, chapters.ca, futureshop.ca to name a few big ones...)

      Then again, you'll probably ju

  • Completely inaccurate story summary... (Score:5, Informative)

    by WIAKywbfatw ( 307557 ) on Thursday January 22, 2004 @10:32AM (#8055008) Journal
    What the agreement (that avoided a court case) stated was that CD-Wow would source products that they are selling in the EU from within the EU, not from elsewhere (eg, Asia).

    Unfortunately, because manufacturers charge more for the EU versions of their CDs (or, to put it another way, because they aren't discounted as much as CDs intended for Asian consumers) this means that CD-Wow will have to pay more for its stock in future. To reflect that increased cost, CD-Wow is putting up the prices of its CDs by 2 pounds.

    The reason for this is that (ridiculously) buying goods from cheaper sources outside the EU without the permission of the vendor is illegal. Other companies, such as Levi Strauss, have taken supermarkets and other discount retailers to court over grey (non-EU sourced) imports in the past, so CD-Wow would almost have certainly lost the court case that was avoided. Clearly, this is one law that EU consumers would love to see changed.

    Other online vendors who the BPI believes are selling grey imports in the UK are also being considered for legal action. These include Amazon.co.uk (which is based in the UK) and Play.com (which is based in the Channel Islands).

    Why the crackdown? Well, I'm sure the BPI is being pressurised by traditional retailers complaining about losing sales to etailers undercutting them at every opportunity. It's not a coincidence that since the likes of CD-Wow, Play.com, etc appeared the average cost of an album in the UK has dropped to 10 pounds. And it's also not a coincidence that cheaper CDs (on the high street and online) led to a 30 percent rise in UK album sales last year.

    As a regular CD-Wow customer, I'm disappointed by the BPI's stance, the agreement and and the law that forced it, but I'll continue to shop at CD-Wow because, for the most part, they'll still be cheaper than many of the alternatives. Not only that, but they somehow manage to ship from Hong Kong to the UK faster than most their rivals shipping from one part of the UK to another! Their customer services are friendly and helpful too.

    Hopefully the consumer-hostile legislation that led to this agreement will soon be repealed. When that day comes, I'm sure CD-Wow will drop its prices again.
    • How does anything you said contradict the story summary? Only insofar as forcing CD-Wow to pay an extra 2 pounds per disc is different than forcing CD-Wow to charge consumers an extra 2 pounds per disc. In other words, scarcely different at all.
      • The story summary says that the BPI demanded that CD-Wow raise its prices by 2 pounds per CD. What they actually demanded was that CD-Wow stopped sourcing CDs that it was selling in the EU from outside the EU.

        The end result is that CD-Wow will be raising its prices by 2 pounds per CD, but it wasn't because the BPI walked up to them and said "Raise prices by 2 pounds or else!" If that were true, they could equally have demanded a price hike of more than 2 pounds, or hit CD-Wow with the same demand in a year
    • This case is a simple matter of commercial rights and is pretty clear cut, simple stuff. There's really nothing for slashdotters to get outraged about. Imagine for a minute that it wasn't CDs but, say, Apple computers at stake. Say some company is buying Macs in the US (where they are far cheaper than the UK) and importing and selling them in the UK, undercutting Apple's own prices.

      Now there's a good argument that this should be perfectly legal - after all, the computers were bought legit from Apple, why s

      • Re:Completely inaccurate story summary... (Score:5, Interesting)

        by radish ( 98371 ) on Thursday January 22, 2004 @11:38AM (#8055868) Homepage
        But if you want cheap stuff from abroad, you're free to either go there or order it direct from stores in that country (but be ready to pay import taxes)

        But that's the whole point. CD-WOW is in another country - it's in Hong Kong. I am ordering direct from them, and I am liable for any import duties (which are actually waived under 30GBP value). So this is what I have a problem with - CDWOW bought a legitimate product from their local supplier. They then decided to sell it to me, who happens to be in a different country. This is somehow deemed "wrong". That's crap, and it flies right in the face of any notion of free trade.

  • The Corporate View (Score:5, Insightful)

    by johnos ( 109351 ) on Thursday January 22, 2004 @10:32AM (#8055011)
    There are lots of morons in suits that think this bit of news is a good thing. However, the smart ones will think just about the same as the /. crowd. This is a huge admission of weakness by the UK music industry. Sure its easy to crush some dotcom, but they've just raised a huge flag that will attract attention from those not so easily intimidated. The legal basis for the threatened action against CD-Wow is thin at best. Amazon or someone else who can afford the legal bickering can now swoop in and do exactly what CD-Wow is backing off of.

    This is, IMHO, another example of the record company's desperation. Cooler heads would have ignored CD-Wow. Realistically, how much could an HK based dotcom change the UK market? Not much in my estimation. But by taking this action, the BPI suggests to retailers that they might be able to get a leg up by importing CDs. The BPI just fucked its members. I hope they are enjoying their "victory" today. A few more like this will kill them.
    • Except that Tesco, with their huge legal resources, lost a similar case against Levi's. As a result, Levi jeans are twice the price in the UK, as they are in the US. I like Levi 501's because they fit me well, but am boycotting them because I don't like to be ripped off in the manner. I'm now planning to do the same with cd's.

      HH
      --

  • The hypocrisy of big business (Score:5, Insightful)

    by GreenCrackBaby ( 203293 ) on Thursday January 22, 2004 @10:33AM (#8055026) Homepage
    This is what gets my blood boiling about corporations today.

    "Well, this guy in India/China/Mexico is willing to work for less than you. Can't compete with those wages? Oh, too bad!"

    Compare to:

    "Well, this CD costs much less in India/China/Mexico. We can't compete with those prices. STOP! THIEF! SUE! BLOODY MURDER!!!!"

  • Speaking as a Brit (Score:4, Interesting)

    by Fr33z0r ( 621949 ) on Thursday January 22, 2004 @10:34AM (#8055033)
    We really do get bent over by everybody when it comes to our cash.

    Looking at my own economic situation (I'll convert prices to dollars :), I smoke and drink alcohol, both of which are heavily taxed so I probably wind up paying about $100 a week on the tax on those, then I've got road tax, council tax, x tay, y tax and z tax, and to top it all off I pay V.A.T on everything I buy - that's 17.5 percent added on *after* taxes, shit we even pay VAT on delivery when we buy our [overpriced] stuff.

    In a regular week with no cash spent on toys, I probably pay about $200 on sales taxes, my wages are even better, with upward of $700 getting taken off my wages every week.

    that's close to $1000 a week I pay the government, I'm really curious as to what the fuck the government does with all that money.

    Now I'm going to be taxed up the ass for, uhh... well, going by the article, *nothing at all* - it's just some greedy assholes who want money for doing zero.

    I used to buy CDs, not any more, I refuse to piss away any more money on money-grabbing fucking middlemen without the skills or talent to produce something worthwhile on their own. I'll support the artists I like by going to their concerts, buying stuff off their sites, or even just *giving them cash* ffs. The music industry is a total farce and I think I've been a total dumbass for continuing to support it financially all this time.

    No more CDs for me, not until the industry is fixed.

    And seriously, would it kill the government to *not* take so much money from us? :D
    • Where's the money going? Well, of course the socialist government we elected is spending it on:
      - High quality medical care - now only two years for a hip replacement!
      - A fast, efficient and punctual train system - only three times the price of BR!
      - A world-class police force - now with 15% more mugging!
      - An excellent education system - with added Lifetime Debt(TM) feature
    • In a regular week with no cash spent on toys, I probably pay about $200 on sales taxes, my wages are even better, with upward of $700 getting taken off my wages every week.

      that's close to $1000 a week I pay the government, I'm really curious as to what the fuck the government does with all that money.

      You're very welcome to your views on tax, but know that it's completely off topic. High CD prices have nothing to do with tax and everything to do with price-fixing.

      CD-Wow's prices included VAT -- they did
  • Discovered CD WOW just before christmas, and it saved me a packet. Normal, if you want to call it that, price for a CD here is in the region of 17.50 Euro+ or about $22.25 per cd. CD-WOW were selling for 13.95 Euro including postage.

    The local RIAA, IRMA, www.irma.ie, took CD-wow.ie to court as well. The public is not pleased, as we are already the most expensive country in Europe, and the culture of the fast buck, and ripoff is prevalent everywhere. They are forcing CD-WOW to add 3 Euro.

    I for one will nev

  • BPI statements (Score:4, Informative)

    by rokzy ( 687636 ) on Thursday January 22, 2004 @10:42AM (#8055110)
    BPI release statement on CDWOW! [bpi.co.uk]

    and just in case you might start using your brain and realise the isn't a good thing:

    Music Buyers Enjoy Lower Than Ever Prices [bpi.co.uk]


  • You can visit the British Phonographic Institutes homepage (obviously) here. [bpi.co.uk]

    But if you'd rather not be annoyed by the overly gratuitous flash webmash, just send them an e-mail, on general@bpi.co.uk.

    I'm disgusted this is spun as a "copyright" issue.
  • Hmm... I there are only two words I can think of for this...

    1) Price Fixing
    2)Price Fixing.

    I'm fairly sure that they're both illegal.

    Bob

  • According to the BBC's story [bbc.co.uk], the BPI are taking action on the basis that Cd-Wow have somehow violated copyright law. Even though there is no allegation that unauthorized duplication ever took place (all the stock is bought indirectly from the same record companies, albeit their overseas branches). I have no idea why copyright law applies here? I'm yet to be convinced that Cd-Wow have done anything remotely illegal.

    But of course, the musiconglomeratopoly has more money to spend on lawyers, and even if ther

  • Socialism for the rich, capitalism for the rest (Score:3, Insightful)

    by swb ( 14022 ) on Thursday January 22, 2004 @11:02AM (#8055342)
    Yay, I'm supposed to work for less money so I can be competitive with guys living in India, China and other third world countries. It's good for business, I'm told.

    But if I try to turn the tables and expand my purchasing power and buy from those same countries I'm not allowed to because its not good for business.

    What the *fuck*? Why they hell can't I "compete" globally where it benefits me? Why is only business and its fat-cat corporate honchos allowed to exploit global discounts, but the rest of are forced to pay sky-high local prices but get paid third-world wages?
  • They are also chasing Amazon [bbc.co.uk] for the same thing.

    They are in the right in so far as they have a perfect right to put whatever stupid restrictions they like on what they sell, but I think it is a seriously bad move from a public relations POV.

    There was a similar case a few years ago when a supermarket was importing Levis products from the US and selling them at half the normal UK price. Levis argued up to the European Court that they had the right to take the suckers for every penny they could, and won. C

  • Everyone complains about the these bastards, but no one does anything constructive about it.

    Damn it, when will people get the message and do something about it? The recording industry cabal will never mend their ways and no-one not advances the cause by stealing from them. It's time to write them off, get rid of them and move on.

    The way to get rid of them is not to steal from them, it is to boycott them. Starve the f***ers out of their coke and mansions and out of existence.

    I have been boycotting for 1

  • Italian judge's decision applies here? (Score:2, Informative)

    by Anonymous Coward
    A previous slashdot story on Sony's Playstation case should apply here, too.
    The judge said that corporations have the right to globally find the cheapest manufacturers, therefore customers should have the same right, they should be able to buy products globally, whereever it's the cheapest. Corporations can't have it both ways, by maintaining liberal outsourced production and protectionist price control on local markets.

  • If you want to tell the BPI what you think of this (Score:4, Informative)

    by Andy_R ( 114137 ) on Thursday January 22, 2004 @11:24AM (#8055687) Homepage Journal
    Their contact details are:

    BPI
    Riverside Building
    County Hall
    Westminster Bridge Road
    London SE1 7JA

    Tel: 020 7803 1300 (+44 instead of the leading 0 if you are outside the UK)

    Fax: 020 7803 1310 (+44 instead of the leading 0 if you are outside the UK)

    Email: general@bpi.co.uk

  • Let them know your thoughts... (Score:3, Insightful)

    by lga ( 172042 ) * on Thursday January 22, 2004 @11:33AM (#8055801) Journal
    I have just sent an email to CD Wow to tell them that they have lost my custom until they reverse this decision and tell the BPI where to get off. Let them know what you think, there's a feedback form [cd-wow.com] on their website.

  • Copy protected CDs - this is fscking awful (Score:3, Informative)

    by Zog The Undeniable ( 632031 ) on Thursday January 22, 2004 @11:34AM (#8055810)
    It's not the higher prices that are the only problem - it's the copy-protected CDs that are foisted on UK customers by the likes of BMG. I managed to get an unprotected version of the Dido album (for my wife, I hasten to add) from play.com, because they source the Arista version from Canada. The UK version is crippled. If I didn't have the choice I would not have bought the album and would have downloaded and burned it instead - I am not buying ANY copy protected crap, and that's final.

    Unfortunately the EFF campaign hasn't had much impact here - the Dido album was the biggest selling of the year despite being corrupted.

  • Don't know about the UK... (Score:3, Insightful)

    by FooAtWFU ( 699187 ) on Thursday January 22, 2004 @11:35AM (#8055824) Homepage
    but in the US, wouldn't the authorities soon be all over you for conspiring to fix prices if you did that sort of thing?

  • Great way to create black markets and arbitrage! (Score:3, Insightful)

    by JGski ( 537049 ) on Thursday January 22, 2004 @01:07PM (#8057053) Journal
    They only succeed in creating more black markets (aka file sharing) and more arbitraging "middlemen" (file sharers). The economic demand will always be met, no matter what price-fixers wish or pretend would happen. And there will always be collateral damage (DMCA, DRM, etc.). The same economics applies to illegal drugs (with collateral damage of Asset Seizure laws, private citizens' planes shotdown in jungles, etc).

    Do these people never learn from history? Haven't they noticed that fixed exchange rates/prices and draconian attempts to control those goods (like the Soviet Union had or the US War on Drugs (WOD)) always create black markets that try to bring prices to the actually demand price? It's abundantly clear that absolutely no one in Music Industry management has ever taken a single economics course! If they did nothing seeped in. Perhaps that's a forbidden subject.

    WOD price goal: set price of drugs to infinity to eliminate demand/use; civil rights are largely irrelevant compared to moral and social control of "incorrent and dangerous" goods (moral monopoly)
    Blackmarket response: offer drugs supply and price at increasingly lower prices to meet demand

    Soviet price goal: control economic system for ideological purity and assure party control of country: both use 10-year plans on production without appropriate feedback basic as actual economic demand is largely irrelevant compared to ideology/party control (political monopoly)
    Blackmarket response: offer illegal foreign currency that can buy goods or goods themselves that are actually wanted/needed

    RIAA price goal: set price to maximize profits; music quality and customer satisfaction are largely irrelevant (market monopoly). Microsoft, SCO and similar also qualify on goals and tactics.
    Blackmarket response: offer music, for free by file sharing, or at a reasonable market price, which people actually want; if an arbitrager can get RIAA price > offered price > free, someone would try; perhaps Apple Music Store is an example, where price includes opportunity cost savings due to choice of individual song vs. buying the whole album.

    In other words, you can see the kind of historic friends and company the RIAA keeps - the goals and methods are essentially identical. No wonder everyone hates them. No wonder the pattern of failure and doom pervades all three.

  • A short lesson on basic economics (Score:3, Interesting)

    by mst76 ( 629405 ) on Thursday January 22, 2004 @03:13PM (#8058938)
    This is somewhat off-topic, but I think it's important enough to post anyway. One of the nicest things about the classical free market perfect competition economy is that products are sold at the lowest possible prices. If one producer charges more, consumers would soon flock to another producer who is willing to take less profit, so prices soon drop to just above production costs. It should not be surprising that few producers like to operate in such a market,
    so very few consumer goods are traded in markets resembling perfect competition (perhaps generic hardware like brandless DRAM or ethernet cards?).

    Most goods are produced/sold by a fairly limited number of parties, who often engage in some form of collusion (i.e., a block of producers acting together as a monopolist or cartel). This usually takes the form of price fixing, which may or may not be forbidden, depending on the exact market and the nature of the agreements. Other than boycotting the industry, there is little that individual consumers can do about collusion. Legislature on the subject is pretty complex, and proving tacit collusion is usually difficult.

    The other way for producers to escape perfect competition is to differentiate the product, through quality, design or simply by promoting the brand. Notice that almost everything you buy has a brand? All marketing is designed to make you believe that that brand is *different*. The more different the brand name product is perceived to be, the more the supplier can act as a monopolist. Being a monopolist is not a binary state, as many people seem to think. A producer can act more as a monopolist if there are fewer substitutes, but there are few products for which no substitute exists at all.
    A singer has a monopoly on his/her voice, but if the price is too high, find another singer. The RIA may have monopoly pricing power on music CDs, if they set the price too high, find another medium for music. If alternative distribution channels are outlawed, find other forms of entertainment, like films, books, games. If entertainment products are priced too high, entertain yourself. The key is to realize that we have many many options, and there are very few products that we in fact cannot live without.

  • End of the world (Score:3, Interesting)

    by sPaKr ( 116314 ) on Thursday January 22, 2004 @04:13PM (#8059652)
    JEBUS. Since when do trade groups get to directly enforce tariffs. At least back in the day you had to purchase a polition, or a few of them and then pass a tariff to be put on a good. Now it seems that trade groups with the threat of legal action impose a tariff on companies they dont like. Couple this with the recent news that the RIAA is building a shock trooper squad and it becomes obvios that the Publishing groups are no only producing media, but rather inventening their own goverment system to steal the rights from citizians of the old system.

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