Interesting spin you put on things - cervama, "If copyright is such a big issue . . . " - Well guess what it IS a big thing. And here's something else to consider, while you're moving the logic furniture about, just because an individual hasn't been found guilty, does not mean that an exsisting law is not relevant and in place. But I guess that's not what you want to hear .. is it?

If gravity is such a big thing . .how come the sky don't fall down?

My very bestest of regards,

Grazie

My understanding is that napster kept a central repository of their userbase, which the riaa could then say that legally they knew their users were trading copyrighted materials. I think kazaa does not have that, but the users connect to each other. The riaa is probably doing something like monitoring the ip addresses of the users, which can then be identified through the ISP. Or something like that.

The above post is correct, just as a an example, xerox machines & videos can be used for copying, but the manufacturers are not sued fro making and marketing them.

I work at a University, and I can't tell you how many Emails we receive from the microcomputing division warning us not to download with any peer to peer software system. There are watchdog companies out there who not only monitor, but check all of the IP addresses of downloaders, and if you are downloading through a network, be it from a business, a school, or a library, and they see you, they will contact the administration and request that the administration "deal" with the situation (fire the employee or prosecute the student to the extent that their network usage terms allow). Last year alone there were more than 200 complaints filed against students and staff.

From what I understood, it is harder to prosecute people who download through a private internet service provider, due to the cse that arose during Napster's hayday, when the MPAA and the recording industry tried to sue an ISP for what its client downloaded. That gave some protection to those people.

What it comes down to, and I'm sure most of us understand this, is people who download illegally are stealing from everyone who helped produce the item they downloaded. Yeah, we've all heard the "everything is overpriced" excuse, but if that is your argument, then you should protest by not purchasing and going without instead of stealing. Download at your own risk....People will eventually put an end to it.

that's grazie for the imput, it was just a question no harm intended, I re-phrased the question, I think it came out wrong.

it was just on the news that Tower Records is going to file Chapter 11 because their sales are so poor. According to the news Tower is blaming it on Music downloading/File Sharing.

Tower can blame illegal downloads all they want but the truth is that their prices were grossly inflated. When I lived in Madison, WI, the Exclusive Company, a regional CD/record store, would regularly sell discs for ~$5 less than Tower and its ilk despite the fact that Exclusive lacked the ability to purchase in the same quanities as the big music chains.

These days when I pop into one of the big music chains, I just laugh at the prices... $16.99, $17.99 for a disc... yeah right.

Amazing how much folks think they really know about this particular subject. (record prices)
Yup, prices are inflated. That's why last year alone we lost more than 300 labels, indies and major subsidiaries alike. (tongue so far in cheek it hurts)
I'd be amazed if anyone here could articulate the costs of selling a CD in a major chain by a standard label, the markups in the chain of distribution, and have it be even remotely accurate.
Keep in mind that until recently, my entire income was derived from the sales of records by a major chain. And I still derive a good portion of my income from same.

I do remember a couple of facts...in the early days of CD, prices were $12 - 13 or so, and that was considerably higher than albums or cassettes. It was attributed to the new format, the cost of new manufacturing, etc, and that soon prices would go down because the cost of raw materials was less than the cost of making albums. But, prices never went down, and I don't know why. The other fact I remember reading is that chains like Best Buy and I suppose Walmart, who sell new cd's for $9.99 are doing so as a loss leader to get people in the store. So, I would think that a major music retailer would have to sell at between $12 - 17 - but those numbers have NO basis in reality, I just know that the $10 price point is below cost.

David

The "short" version - from a distribution side and dealing with Tower...this is video related, but overall distribution is the same for music.

We make a product. Excluding our cost of actually making said product - tape duplication, box art and printing, layout and so on is about $5.00 per tape. Ok, that is *our* cost...what we need to break even so to speak. We go out with a SRP at first of $59.95 per unit based on rental. That seems a high mark up but places like Tower are used to paying more - but wait, they don't pay the SRP, that is the consumers SRP. So - we have sub distributors and they buy our product for $15.00 per unit based on minimums of 50 units. Buy 100 and we drop it down to $10 per unit. They, in turn, sell some product to other, more 'major', distributors for about $20.00 - $25.00 per unit. They also sell to some of their key accounts for between $35 - $40 per unit - or about the same cost the major distibutors sell to their key accounts for. You, the consumer, walk into Tower and rent the film for what? $3.95 a night? And you want to buy the film - and they say they will sell it to you for a 'discount' of $50.00. This is how it works - this is very much how it works, right from the horses mouth. And as I said, this is the simple version.

Now lets drop it down - 30 - 60 - 90. After a title goes to rental the prices from 30 days, 60 days, 90 days all drop. Now the prices to you, the consumer, are down to a sell through price of maybe $10.00 - $15.00, but our prices are still the same - the duplicating cost and so on. But now what has changed is the distributors still want their discount - and when the title gets to the $9.95 stage Tower expects to pay about $3 or less per unit for it...but our per unit cost is still around 5 bucks. At this point most of our distributors don't touch the product because for them to go out the same way they would want us to sell them product for between 50 cents and $1.00 per unit. Now keep in mind they also do not want to pay for shipping, and they want it yesterday. So your per unit cost goes up. ..but you, the consumer, are still getting the product for "under $10.00". Who is making the money? Not us. I can't tell you how many distributors I have laughed at, to their face, when they say "We would like 50 units and you pay for shipping. And we would like 75% off of SRP." And I laugh because that would be about $2.00 per unit PLUS shipping to about 10 - 20 distribution centers, and they always need it in 2 days. Remember our per unit cost is still $5.00.

Now enter DVD - the cost is less already. It doesn't start out at 100 bucks for the rental market. Same for music. It doesn't start out for the rental market. But the supply chain is still the same. Back in the day when Tower still accepted indy albums in their stores you could hook up with an indy or with a store manager and get your product in the store. You could cut out all the BS in between. But than the bottom fell out and all the chains all went to the majors to get their product. You weren't being distributed by Ingram, Baker and Taylor and so on - forget about it. You aren't in Soundscan, R&R or Billboard forget about it for radio. No radio, no market, no stores want it - distributors sales reps won't push it. Been there, done that - been on all sides of this issue. The internet is a great way for people to hear *new* artists because you simply can't find them in the stores. The tide is going this way for indy films as well because of the same reasons.

Is their a high mark up? Sure. But keep it in perspective - most acts don't get the first dollar from each CD sold, they get a percentage out of whatever is left over after everyone else gets their dollar. Go back up to the videos - I said *our* cost per unit was about 5 bucks. But keep in mind that does not include the payments out aside for breaking even. THe production company got a % of that and peoples pay came out of that as well. Figure the duplication cost was about $1.50 per VHS tape, the boxes were avout 15 cents based on a gang run of 5,000 and so on...maybe the "profit" was a dollar. Pretend that is a CD and from that dollar the artist got 10% of the dollar. Do I wish it were that way? No. Do I know artists that are happy with that way? No. Do I know artists that are now turning to the internet to get their music out there? yes.

Bypass Tower and have sites like IUMA and others make your music available and keep 50% or more of each CD or download - you end up with more. People aren't stupid anymore on either side of the issue. People still go into places that Trans World owns and pay 20 bucks for a CD that Target has for 10 bucks. They go in and buy a new DVD for $29.95 when Wal Mart has it for $19.95.

I think Tower refused to look ahead and they can blame it on downloading because that is probably a huge reason for their overall loss. But for me I can trace things back a lot further than just the internet. I remember when Motley Crue put out their indy album and you could find it in Tower on Sunset and at Music Plus on Vine, off Sunset. KMET would play Ratt and Quiet Riot. Rodney B on Kroq would play demos from bands he liked as well as many indy singles. KMET vanished, Ric Carrol figured out how to market alternative to the masses, indys distributors went under because chains stoped taking in indy product - and now Tower wants to blame it all on downloading.

Sorry, this doesn't have a lot to do with the original thread topic but it is worth keeping in mind. We make films, or shoot videos, that we hope people will see. You want it to be in the Blockbusters of the world for rent and you want it be on the shelves at Wal Mart but It ain't easy.

In response to Spot...

Sure, I admit I know nothing about the supply chain. I never claimed I did. What I do know is that when I went to college in the mid-90s a much smaller business's (maybe four total stores - all in WI) regular prices were $11.99 if you paid cash ($12.54 if on credit card) and at the big, national chains (Musicland, Sam Goody, etc.) the same discs were regularly priced at $16.99.

As I recall, wasn't there recently a large settlement regarding price fixing on the sales of CDs?

I am also not disputing that there has been a major hit to the industry. In part, it was their own fault for being slow to react to the changing technology. Many people were tired of buying a whole CD for what ended up one or two good songs. When the opportunity presented itself, many took advantage by getting only the songs they wanted.

Was it unethical and illegal? Of course. However, had sites like iTunes been developed and promoted earlier, I believe that many (a few, some, most) people would have gladly done the right thing and paid to get the songs they wanted. Me, I just stopped buying music altogether except to replace my old cassettes with the CD version (thus, I knew what I was getting). And, no, I did not download music. I just did without, listened to the radio, enjoyed what I already owned, etc.

To get back to my original point, if one company can stay in business selling the same product for 30% less than their competitor who has better purchasing power, then I am going to conclude that the higher priced competitor is trying to rip me off. Sorry, but to me that falls into the "Duh" category.

I have to agree with Miserman, including all the disclaimers on the recording industry, marketing, distribution, etc.

However, the one item that hasn't been mentioned is the quality of music, or the lack thereof. Most of what is being churned out today is crap, pure and simple. Just one guy's opinion.

I'd buy (older) records on CDs if I could find them, but I can't. Now, I don't download illegal ones, but the recording industry isn't helping itself by being stuborn. Still, that doesn't justify the illegal acts of others.

It's extremely difficult for me to work up any sympathy for the folks (regardless of the industry they're in--records, movies, sports, t.v., computers, oil, you name it) who have been making money hand-over-fist and whining about not making more and faster. Welcome to tight times, folks. Greed it an ugly habit to get into.

J--

Jsnkc wrote:

"Their day will come soon enough. Anyone who downloads crap off of there is pretty stupid anyways becasue of all the viruses that people plant, and the RIAA is monitoring it. Yet there are still so many people that just don't get it!"

well just searching for some info on the grammy's at their website and saw this:

Australian Investigators Raid Kazaa Offices

Investigators from the Australian recording industry raided the offices of file-swapping company Kazaa on Friday, using a rarely implemented law allowing litigants in civil copyright cases to collect evidence. Raid sites included the offices of Kazaa parent company Sharman Networks, the homes of two company executives, three Australian universities and Internet service providers. The Australian recording industry will reportedly launch civil action against Kazaa on Feb. 10.

My three cents. (Inflation strikes!)

The excuse that "the current music sucks and that's why people don't buy CD's" is complete nonsense. There are certainly some people (anyone older than 16) who think, for example, that Britney Spears is junk (and I agree), but those performers are the ones being downloaded the most. If music is so terrible why is it downloaed so much? The "music sucks" excuse holds no water at all. We're older now and we think that "kids" music sucks just like our parents thought our music sucked.

As for CD prices, sure they've gone up, but not as much as 22 years of inflation should have driven them. The price of bread, cereal, gas, electricity, etc. have all gone up more. Also, Universal drastically slashed their prices back in October, giving most of their CD's (and they're one of the biggest companies) a retail of something like $11.99, which means most stores sell them for a buck or two less.

Lastly, in response to the original post, the RIAA *IS* going after Kazaa. There's at least one active suit against Sharman Networks, the parent company of Kazaa.