From: ucap22w@ucl.ac.uk (Martin S T Watts)
Newsgroups: rec.music.classical
Subject: Re: EMI price increase
Date: 13 Oct 92 15:47:35 GMT
Organization: Bloomsbury Computing Consortium


velde2@jhunix.hcf.jhu.edu (Velde Francois) writes:

>Of all these costs, the ones that are going up the fastest are probably
>the artists (some on this newsgroup write liner notes, they could tell
>us if their earnings have gone up recently...).
>This may be a variant of the "performing arts disease": the basic fact is
>that it takes as many qualified people to play a quartet today as 200
>years ago. In most economic activities, we have gone through labor-saving
>technological change, and capital accumulation which makes capital 
>relatively cheaper.  for music, on the contrary, we insist that the 
>same technology be used (even the same instruments): a larger share of
>the costs will be remuneration of labor, and as incomes go up, the
>relative price of opera tickets and CDs will go up.

For musical performance, maybe, the 'technology' is the same. For the recording
of music, this is hardly the case. I agree, though, that the costs of getting
artists to record are probably spiralling ever upwards and this inevitably
contributes to an overall increase in costs, but artists can only afford
to demand such high fees because consumers are prepared to pay exorbitant sums,
spurred on by the sort of argument you give below, in addition to cynical
marketing campaigns by record manufacturers.

>>
>>If a company has sunk $500,000 or so into a recording, the only way they
>>can earn it back is by their X% of each copy sold.  Given the way such
>>expenses keep going up, one could make a case that CDs cost too LITTLE
>>in this country (they cost significantly more in Europe).  

>I wouldn't go that far. Presumably the market in the US is competitive, but 
>not to the point where DG competes with Philips with cut-throat price
>discounts.  If CDs are more expensive in Europe (not only on average:
>the same Harmonia Mundi CDs are a good 30% more in France), it is because
>of taxes, and inefficient/monopolistic distribution systems.

Are most DG and Philips CDs not manufactured in Europe? I thought they were.
EMI, of all companies, is independent and based in England, yet their CDs
are as expensive here as any others - do tax and distribution costs account
for this?

And are DG and Philips (and Decca) not just different aspects of a three-sided
Polygram coin? If so, are they really likely ever to enter into any cut-throat
marketing campaigns?

>>A CD seems like a bargain.

>Indeed.  Think of a CD as a perpetual investment: with a 10% discount rate, 
>a $15 price tag for a CD is like paying $1.50 to rent that CD for 1 year.
>I find that cheap, compared to, say, $6 for a movie I see only once,
>or $2-3 to rent a video-cassette for 3 nights.
>This line of reasoning is dangerous: it can lead to over-consumption of CDs...

Not only is it dangerous, it's also pretty daft. If the record companies 
thought that everyone was following that line of logic, Lord knows where we'd
be with CD pricing, not to mention books, or any other goods which don't (or
needn't) deteriorate over a lifetime. And it really doesn't seem sufficient
to me for the consumer to sit back and take such a neutral stance on the
morality of recording companies and say, "Well, I can just about afford to
buy CDs at their present price, so that's alright". There are plenty who
can't afford CDs at their current cost, who are really at the mercy of those
who can. I'm sure we'd be quite surprised at how much the price of new
releases would decrease if the consumer put his foot down.

Martin Watts.