Friday, February 27, 2004

Antitrust litigation

I got a check in the mail today - $13.86 - payment for buying cds at an illegaly fixed (high) price. Attorney General Goddard noted that it is "a pleasure to bring this matter to a satisfactory conclusion and to return value to consumers who purchases cds while the challenged pricing policies were in effect."

The lawsuit alleged that record companies and retailers "conspired to illegally raise the prices of prerecorded Music Products by implementing Minimum Advertised Price policies, in violation of State and Federal laws." This, of course, is a charge the defendents - Capitol, Virgin, Time Warner, Universal, Bertelsmann and Sony and retailers Tower Records, Musicland and Trans World Entertainment - all denied.

Sadly, screwing nearly all music consumers between 1995 and 2000 cost the companies just $67 million and $75 million in compact discs. Apparently the settlement is figured into the cost of doing business and I doubt these companies are hurt at all.

The fact that a polyopoly of five huge international corporations dictates nearly everything that happens in the entire recording industry is absolutely wrong at face value. These companies aren't the leaset bit concerned with music, artists and fans - they're driven by profit alone. While pushing mediocre crap at $18 a cd, they suddenly start a crusade against file sharing, blaming downloaders for dropping sales. I wish this made sense outside of pure greed.

Executives of these companies average more than $5 million a year in salary: Robert Ames of Warner - $5 million, Jason Flom of Atlantic - $3 million to $5 million, Antonio "L.A." Reid of Island Def Jam - $5 million, Clive Davis of BMG - $10 million, Lyor Cohen of Warner - $10 million and Sylvia Rhone of Elektra - $10 million, according to Rolling Stone.

Does anybody wonder why top-companies engage in price fixing? Or marketing drivel by beautiful people while screwing actually talented artists?