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| From | "Michael Adelsheim" <madelsheim@adelsheimvineyard.com> |
| Subject | Re: Years late, Universal cuts CD prices to combat poor sales |
| Date | Fri, 19 Mar 2010 12:07:32 -0700 |
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Having heard the report on NPR this morning, here's a response I just
made 30 seconds ago.
"As a music lover who also has friends working at what we used to call
record stores, I would like to provide a bit of context to the report
that Linda Wertheimer read this morning about Universal Music's decision
to run a test on what a $10 price tag will do for sales of its cds.
Linda closed by saying, "they'll be available at major retail outlets".
I'm told they'll also be available at indie stores as well, but here's
the rub.
Universal plans to print the list price of $10 on the spine of the
package. Then, they'll sell it cheaply enough to the "major retailers"
for them to make a normal markup.
For the Indies - you know, the folks that actually love music and give
their customers real service - the wholesale price will be high enough
that making a profit at the $10 retail will prove impossible. Thus,
you'll probably see them selling the same discs at $10.99 or something.
Universal has every legal right to prefer selling to the big box stores,
but why do they want to embarrass the indie stores in the process?"
Adelsheim
-----Original Message-----
From: audities-owner@smoe.org [mailto:audities-owner@smoe.org] On Behalf
Of Jason Dunn
Sent: Friday, March 19, 2010 12:02 PM
To: audities@smoe.org
Subject: Re: Years late, Universal cuts CD prices to combat poor sales
The hilarity is, as some of you surely know already, is that the
invention
of the CD was originally heralded as a much cheaper format to produce,
ship
and distribute, but the greed of the industry stopped any kind of price
reduction. It's too bad it's taken it so long to bite them in the ass,
but
it's enjoyable watching a pathetic, self-absorbed industry fail.
On Fri, Mar 19, 2010 at 2:49 PM, Michael Coxe <popville@gmail.com>
wrote:
> For something not RIP related (except to the music industry in whole)
>
>
>
http://arstechnica.com/media/news/2010/03/years-late-universal-cuts-cd-p
rices-to-combat-poor-sales.ars<
>
http://arstechnica.com/media/news/2010/03/years-late-universal-cuts-cd-p
rices-to-combat-poor-sales.ars?utm_source=rss&utm_medium=rss&utm_campaig
n=rss
> >
>
> excerpt:
>
> Sales of digital downloads have not been enough to make up for the
decline
> of CD sales since its peak in 2000. Universal Music Group plans to
soften
> the fall of CD sales by dropping prices across the board <
>
http://www.billboard.biz/bbbiz/content_display/industry/e3i56ed42b9a46f8
554e2671afccecca01b>,
> to a maximum of $10.
>
> The company plans to test lower prices beginning next month and
continuing
> throughout 2010. Nearly all of UMG's CDs will priced between $6 and
$10. UMG
> is hoping that increased volume will make up for the price drop, and
the
> company plans to create more higher-priced "deluxe" versions for more
> hardcore fans.
>
> "We think [the new pricing program] will really bring new life into
the
> physical format," Universal Music Group Distribution president and CEO
Jim
> Urie told /Billboard/.
>
> Retailers have been clamoring for lower retails prices, with many
believing
> that $10 is the magic number to spur sales. (I'll admit, I rarely buy
a
> physical CD for more than $10 these days). A recent test from Trans
World
> Entertainment showed that a $9.99 price point doubled CD sales in over
100
> of its stores.
>
>
> Rock is dead, long live rock!
>
> - Michael
>
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