The fall-out from the EU
commission's investigation into the aborted EMI-Time Warner "merger"
is still continuing and it just might have the labels in Europe a bit worried.
The commission is now investigating what it seems as price rigging in the music
industry across Europe. Everybody knows it exists, but the labels have always
got away with it before.
Our American readers would shudder to think how much is charged for CDs in Europe. In the high street, bricks and mortar stores a CD can easily cost 50% more than its equivalent in a US based store. Most of the European on-line retailers also don't really go in for significant discounting. The end result is that for most Europeans it still works out cheaper to order a CD from the US, pay for air-mail postage, and maybe pay import duty - than it does to walk around the corner and buy the same CD from their local store. Something is very wrong here! And for DVDs it's even worse, though half the time the particular DVD won't even be released in Europe.
Now before you jump up and down, I know the Commission has investigated this before, just a couple of years ago. Labels at that point managed to hide behind the (barely-concealed) lie that Europe has higher transport costs and different taxation methods. Then they said that they didn't dictate the high street prices, they set a wholesale price and it was up to the store what it sold it for. That's such bullshit - stores that heavily discount can find that the labels stop supplying them.... The whole thing is a cartel orchestrated by both the labels and the major retailers. The commission needs to investigate the whole music supply set-up....
Under the previous investigation the labels managed to present a picture which suggested that CDs in Europe were only 10% more expensive than their American counterparts. That's stretching the truth somewhat! And since then a lot of things have changed with many of the labels cooperating on manufacture and distribution to lower their overheads - but, funnily enough, the prices haven't dropped any....
The sinister thing is that I believe, the labels think they can do the same thing as the do in Europe, to the rest of the world in time. All of the recent merger activity makes the labels feel bigger than any government and more powerful. Not only do they not provide us what we want to listen to, they're going to try and find more ways to rip-off the poor listener again and again.