Beta

Slashdot: News for Nerds

×

Welcome to the Slashdot Beta site -- learn more here. Use the link in the footer or click here to return to the Classic version of Slashdot.

Thank you!

Before you choose to head back to the Classic look of the site, we'd appreciate it if you share your thoughts on the Beta; your feedback is what drives our ongoing development.

Beta is different and we value you taking the time to try it out. Please take a look at the changes we've made in Beta and  learn more about it. Thanks for reading, and for making the site better!

RIAA Says CDs Should Cost More

kdawson posted more than 7 years ago | from the when-bandersnatchii-fly dept.

Music 540

EatingSteak writes "The folks over at Techdirt just put up a great story today, with the RIAA claiming the cost of a CD has gone down significantly relative to the consumer price index. The RIAA 'Key Facts' page claims that based on the 1983 price of CDs, the 1996 price should have been $33.86. So naturally, you should feel like you're getting a bargain. Sounds an awful lot like the cable companies saying cable prices are really going down even though they're going up."

cancel ×

540 comments

My eyebrows are raised.... (5, Insightful)

BWJones (18351) | more than 7 years ago | (#17916738)

Funny (not as in ha ha) because as I recall back in 1983 the record companies acknowledging that CDs *were* expensive but that the price would come down as the number of CD sales went up. Back then a record album ran around $7 US and CDs were anywhere from $13-18 US and I could as a 13 year not afford many CDs, but did I ever load up on all those punk 45s, likely outspending what I would have on CDs over time. What the record companies can not apparently figure out is that if priced affordably, some sales are money in the pocket versus no sales and no money in the pocket. Judging from the precipitous fall in music sales and revenues over the past few years from lousy music, over priced music, DRM and bad will from the RIAA, they obviously just don't get it. Now, if they were smart.... record companies would *give away* music from bands just starting out and from the biggest bands out there and make money from tours. Bands in the middle of the spectrum could be the "middle-class" of the record companies that could provide the most profit after small bands graduate into the middle class and start selling their music, touring as they want.

Re:My eyebrows are raised.... (5, Interesting)

ZachPruckowski (918562) | more than 7 years ago | (#17916796)

Correct. The 1983 price of CDs reflected the costs as an immature technology. Production costs for digital music have plummeted, as have the costs associated with pressing CDs. Similarly, in 10 years, the cost of an HD-DVD/Blu-Ray (whichever wins) will be a lot lower than current prices. It won't cost $500 a player, it'll cost more like $100.

Re:My eyebrows are raised.... (5, Funny)

iocat (572367) | more than 7 years ago | (#17916804)

In 1983, CDs were considered this magical reference format, occupying roughly the same audiophile space now occupied by... vinyl records.

Re:My eyebrows are raised.... (1)

$RANDOMLUSER (804576) | more than 7 years ago | (#17916896)

I wish we had d00d, yer killin' me yer so right... mod points. Remember the elcaset [claranet.nl] format?

Re:My eyebrows are raised.... (1, Informative)

BRUTICUS (325520) | more than 7 years ago | (#17917128)

i remember a sales person at a record store telling me that you could throw CDs against the wall and they wouldn't scratch.

Re:My eyebrows are raised.... (5, Insightful)

dtfinch (661405) | more than 7 years ago | (#17917258)

You can bounce a CD off a wall without scratching it. It's not until they land on the floor afterwards, spinning as they slide across the rough surface, that you have to worry about scratches.

Re:My eyebrows are raised.... (1)

kimvette (919543) | more than 7 years ago | (#17916818)

Funny (not as in ha ha) because as I recall back in 1983 the record companies acknowledging that CDs *were* expensive but that the price would come down as the number of CD sales went up.
They were still saying that in 1991-1992 when record stores were knocking vinyl down to 80% to 90% off to clear space for CDs.

Without doing actual research... (5, Informative)

NotQuiteReal (608241) | more than 7 years ago | (#17916956)

Some things in 1983 were cheaper. But many were more expensive. Even in absolute dollars, not even counting inflation.

CDs are STILL $13-18 (unless they are at Costco or "on sale", usually), but back in 1983, a decent computer cost $2000 (you can't even buy a computer that bad now, for as little as $299).

Even a nice calculator was about $50 or so (better ones now for under $20). A Color TV (A heavy CRT, 13 channels, click-click tuner) was 2 - 3 times what they cost now (for 121 channels, multi inputs, remote, etc. etc.)

The list goes on and on and gets "worse" (for the RIAA argument) when adjusting for inflation. LOTS of stuff is far cheaper than it has ever been.

Bah.

Re:Without doing actual research... (1)

Spookticus (985296) | more than 7 years ago | (#17917088)

The list goes on and on and gets "worse" (for the RIAA argument) when adjusting for inflation. LOTS of stuff is far cheaper than it has ever been.
Not really cheaper even though the actual dollar amount has changed. Inflation, deflation and higher incomes come into play when talking about prices from different eras

Re:My eyebrows are raised.... (4, Informative)

sumdumass (711423) | more than 7 years ago | (#17917010)

This is also interesting because they conspired to raise the prices of cd's [wired.com] already. Wonder if they will get away with it this time?

And right on, They compare the price of a new product to the price index instead of the price it should have been retailing for. If someone did the math in the same way with a normal valued price, I would bet that they would be a little more expensive now. I guess RIAA might be doing the "see, you getting a deal already so don't pirate" thing here.

Nothing like making you feel good about paying too much for something then by illistrating that they could be at a higher price.

Re:My eyebrows are raised.... (1)

Profane MuthaFucka (574406) | more than 7 years ago | (#17917166)

Excellent point. I've spent more in the past year to buy 10 MP3 tracks for 2$ at a time than I've spent in the past decade on conventionally priced music either on CD's or from iTunes. Make it cheap and I will buy much more of it. Basic economics.

Re:My eyebrows are raised.... (5, Insightful)

sk999 (846068) | more than 7 years ago | (#17917186)

Well stated - matches my recollections as well. The price of CD's has NEVER come down since they were first introduced, and it is only because of inflation that their relative price is now on a par with that of record albums from yon times of yore. Taking 1983 as a reference point for what CD's OUGHT to cost, when CDs were a new technology, is just insanity.

Re:My eyebrows are raised.... (0)

Anonymous Coward | more than 7 years ago | (#17917214)

Absolutely right on about the industry's early statements. I was at CES in 1983 and first heard a CD at that time. The going line was that it was very expensive to begin with since there was very high failure rate in production. However, they said once that was fixed, the price should drop to around $8 per disc. As we know from the MAP class action a few years ago, they colluded to prevent the price from dropping.

I find it most interesting that a movie that cost tens of millions of dollars to produce and promote an be purchased for $15 or less, sometimes under $10 even when brand new, and yet an album on CD, not DVD, costs as much even though nowhere near as much money goes into its production.

Even more amusing is how a five year old movie can be found for $5 or less, while a five year old CD usually costs as much as when it was first released.

let me be the first to say.... (1)

theheff (894014) | more than 7 years ago | (#17916746)

bullshite.

I'll One up you... (3, Funny)

Bananatree3 (872975) | more than 7 years ago | (#17916874)

Die!-a-RIAA!

Read The Fucking Submission (1, Funny)

Anonymous Coward | more than 7 years ago | (#17916962)

The RIAA 'Key Facts' page claims that Based on the 1983 price of CDs, the 1996 price shoUld have been $33.86. So naturaLLy, you SHould feel lIke you're geTting a bargain.

mod parent UP! (1)

alexandreracine (859693) | more than 7 years ago | (#17917156)

Because I would looooove to see all RIAA people to eat is answer. Literally.

What a joke (4, Insightful)

n1000 (1051754) | more than 7 years ago | (#17916752)

If they should cost more, they would! It's simple supply vs demand! I mean, the RIAA are cartel for all intents and purposes. Who are they to be complaining?!

Re:What a joke (4, Insightful)

feyhunde (700477) | more than 7 years ago | (#17916866)

More complex then that. What's the physical cost of a CD? Blank media from staples works out to a few cents. Before staples, it's even cheaper. Now burning data on a CD does cost money. A red laser in 1983 that can burn media would cost in the tens of thousands, if not hundreds of thousands of dollars. Now it costs less than 100 USD, again retail.

So yah, if it cost the same amount to actually make the CD in 1983 as it did in 1996, or 2007, there might be some validity. But the physical cost of the CD fully packaged is 10 cents or so.

So we're expected to believe the majority of costs in that same article are related to booths. When a 6$ record is replaced by a 14$ CD, the price works out the same. Nothing got cheaper, they just want us to believe a CD is magically as hard to make now as a LP in 1983.

Re:What a joke (5, Informative)

littlerubberfeet (453565) | more than 7 years ago | (#17917116)

What's the cost of a physical CD? let me tell you, since I have managed some commercial releases:

Indie artists who get stuff replicated in 1000 CD batches from OasisCd or Diskmakers pay about $1.70 per CD. These are PRESSED, retail-ready, in standard jewel cases, in color, with barcodes, spine labels and all the trimmings, shipped to your doorstep.

So, a physical cost of a CD is $1.70 or so for non-RIAA indie music. If you go to Sony DADC or another large manufacturing house and order 100K or gold (500,000) press jobs, your cost for a retail-ready jewel case+CD is between $.60 and $.90, depending on printing options. This info is from an actual quote. 10 cents a fully packaged disc is unrealistic. Materials alone are more then that. 10 cents gets you a pressed CD with 1 silk-screened color and a mylar sleeve.

Remember that about 50% of any retail price consists of retailer/wholesaler cuts. Indie artists who sell through Amazon watch as Amazon takes 55% of the retail price, distributing 45% to the artist. Assuming a $12.00 CD, lets break this down:
Out of that 45% ($5.40), the artist has to fund:
shipping to Amazon ($.25)
Duplication ($1.70)
17 U.S.C. 115 compulsory royalties ($.91) low end cost.
Producer's standard 20% cut ($1.08)

This leaves $1.46, with which the artist has to eat, promote, fund the next record, and tour on.

Anyway, the point is, CD pricing is complex. The RIAA is wrong though. CDs should cost less, but at the expense of our convoluted, monopolistic distribution system (cartel?), not at the expense of the artists.

Re:What a joke (1, Insightful)

Fulcrum of Evil (560260) | more than 7 years ago | (#17917140)

Buddy, we're talking about pressed CDs, not burned discs. Last I checked, in 1000 disc quantities, CDs cost roughly $0.90 - $1. That includes packaging and cover art.

Re:What a joke (4, Interesting)

Technician (215283) | more than 7 years ago | (#17916950)

If they should cost more, they would! It's simple supply vs demand!

No it is not. Ask what happens to unsold CD's at the local music store. Prices are artificialy high by created shortage. Surplus is returned, not sold on a discount. Ask your local retailer what happens to unsold titles that waste valuable floor space.

Re:What a joke (4, Insightful)

EatingSteak (1053512) | more than 7 years ago | (#17917148)

"It's simple supply vs demand!"

I don't think I'm the first to say, but it really isn't supply vs. demand at all.
"Supply & Demand" implies a free market, ie, one with (theoretically) infinite suppliers and infinite consumers. In practice, we just say "many" suppliers and consumers, both of whom are price takers. Emphasis on takers.
Even with the concept of monopoly pricing "creating a shortage", that is more like OPEC (a large group acting as a monopoly). OPEC, believe it or not, is a price taker. They do not say "ok I will sell you this many barrels of oil at, say $60/barrel. They can only set a goal price of $60 by restricting supply.

Retails sales are a completely different ball game. Of course, by the definition of copyright, and the fact that the record label holds it (as opposed to the artist), that label has a monopoly on selling that artist's music. To prevent competition from similar artists, they have a cartel going for them.
So, one could say that the labels have at least a partial monopoly. But here's the kicker: they are price makers. In a market (such as the market for futures, where you get quote "oil prices"), a monopoly would set supply. In retail/wholesale, the label sets prices (well, wholesale prices). There is no market to buy whatever's there at whatever price will make it move.
Rather, the labels set a price (at least a wholesale price), and the public buys however many units they feel like. The supply is theoretically infinite... it'd be a tough case to argue that they would stop printing additional CDs as long as they keep selling. Basically, they set the price (retail is $12.75 IIRC), and the public buys or does not buy.

Re:What a joke (1)

PresidentEnder (849024) | more than 7 years ago | (#17917266)

Wait, haven't they been free since 1999?

Because it's not like production ever gets easier (4, Insightful)

Anonycat (905015) | more than 7 years ago | (#17916770)

I suppose we should have to pay $1300 for a Commodore 64 nowadays, too?

You don't even want to hear how much the RIAA thinks you should have to pay for a machine capable of a billion calculations per second...

Re:Because it's not like production ever gets easi (2, Insightful)

ZachPruckowski (918562) | more than 7 years ago | (#17916868)

Yes. This is a fundamental intersection between two economic concepts - Inflation and Moore's Law.

Inflation indices imply that prices have risen over the last few decades. However, those numbers are averages across a wide variety of (generally non-technical) goods. There are numerous causes of inflation, and I won't discuss that here.

Moore's Law is not strictly speaking an economic law, but with the benefits of Moore's Law, we see electronics and machines become more affordable. In all likelihood, production costs have plummeted for the actual music, and I assume CD error rate has gone down. As a result, the cost to make a CD, from start to finish has seen the price of its components fall (as measured in utility/cost). Therefore, the price of CDs don't have to rise.

Re:Because it's not like production ever gets easi (2, Interesting)

Osty (16825) | more than 7 years ago | (#17917054)

In all likelihood, production costs have plummeted for the actual music, and I assume CD error rate has gone down. As a result, the cost to make a CD, from start to finish has seen the price of its components fall (as measured in utility/cost). Therefore, the price of CDs don't have to rise.

Playing devil's advocate for a moment, what you say about the cost of manufacturing a CD is absolutely correct. What you're not factoring in is the increase in cost of studio time (rent goes up with inflation, as does the price of labor for the guy(s) running the boards), artist payments (in theory, this should also go up with inflation), marketing costs (have you seen the price of a 30s spot during the Super Bowl?), and of course the costs to pay RIAA's troupe of lawyers and executives.

Does it have to be that expensive to produce music? Absolutely not! With modern technology, an aspiring artist can record RIAA-quality (ha!) music at home for a mere fraction of the cost of studio time. Grassroots marketing, word of mouth, and touring can make for both cheap and effective promotion. Cutting out the middle man (RIAA) allows more money to go to the right places (production, artist) while still lowering prices. Will the RIAA ever get their acts together and do the Right Thing (tm)? I doubt it, since they're the quintessential middle man. Like the GEICO commercials, artists need to cut out the middle man and pass the savings on to you.

Re:Because it's not like production ever gets easi (1)

ZachPruckowski (918562) | more than 7 years ago | (#17917102)

I'd be surprised to see recording costs increasing. Wage increases tend to be below the rate of inflation, the technological costs of the recording equipment are going down, and with improvements in technology, it's taking less time to do post-production on a recording.

Re:Because it's not like production ever gets easi (1)

Fulcrum of Evil (560260) | more than 7 years ago | (#17917196)

What you're not factoring in is the increase in cost of studio time

Sorry, but recording studios can be built for pennies compared to what they cost 20 years ago - generally in the range of $10k when using an existing space. Sure, salaries and equipment rental still cost $$$, but if you're halfway reasonable, that's cheap, too.

marketing costs (have you seen the price of a 30s spot during the Super Bowl?)

who buys superbowl ads for a new band?

the costs to pay RIAA's troupe of lawyers and executives.

Bingo!

Does it have to be that expensive to produce music? Absolutely not! With modern technology, an aspiring artist can record RIAA-quality (ha!) music at home for a mere fraction of the cost of studio time. Grassroots marketing, word of mouth, and touring can make for both cheap and effective promotion.

So you're saying that the RIAA is jacking up their prices because they're less relevant than they were? The only reason the RIAA is still around is that nobody is willing to gut them like a fish, which is what would happen if the government were actually serious about anti-trust. Just try and get significant airtime for a non RIAA artist - when's the last time you heard prince on the radio (stuff from the past 4 years, mind)?

Re:Because it's not like production ever gets easi (1)

The Mad Debugger (952795) | more than 7 years ago | (#17916872)

Sadly, because of inflation, you *did* effectively pay $1300 for your C64. That's what a shiny new black MacBook costs now.. and back in the day, my Commie was pretty pimp.

Re:Because it's not like production ever gets easi (1)

TheLink (130905) | more than 7 years ago | (#17916886)

Hey, if you have a 52X player that means you should be paying 52X :).

Laugh, but wasn't that sort of thinking seriously being used in one case?

CD costs are definitely lower nowadays. Over here "Pirate" stuff is now half or 1/3 the price it used to be, not even factoring for inflation ;).

Re:Because it's not like production ever gets easi (3, Interesting)

Phat_Tony (661117) | more than 7 years ago | (#17917152)

It's clear that no one would pay $1300 for a C64 these days because computers have gotten so much faster for the money. But what's the comparison with music? You cite an example of how old computers aren't worth much because new computers are so much better, so what are you implying, that old music was worth a lot more because new music isn't anywhere near as good? Is new music so much worse than older music that it's not worth paying that much anymore, and the price had to fall on the new stuff, like prices fall on old computers? Obviously not, because a lot of these CD's being sold now have the same music on them that they had in 1983. The march of technology and Moore's law doesn't really say anything about the price of music over time.

The only reason I expect a CD to be inflation-adjusted cheaper today than in 1983 is that in 1983 they were still selling primarily tapes and some vinyl, and the only people with CD players were mostly audiophiles and early adopters, and the CD players had cost them a fortune and were part of premium stereo systems. No one had CD players in their cars, or portable ones, CD players were big, expensive components for rich high-end audio enthusiasts, who were clearly willing to pay a huge premium for the CD experience. The price of a CD in 1983 should be inflation adjusted and compared with the price of an SACD [wikipedia.org] today. CD's are now the lowest-common-denominator standard format for the masses and should be priced as such. Had the price of CD's not fallen dramatically since the 1983 price, they would never have gotten popular and remained inaccessible, which would be an example of the RIAA companies shooting themselves in the foot, reducing profits trough overly high prices and small unit sales.

So pricing changes since '83 are a silly comparison, because the product's placement in the market changed entirely since '83. CD's have been the de facto audio standard now since at least 2000, I'd like to see what inflation adjusted prices have done from 2000-2007. That would indicate what CD prices have been doing.

Re:Because it's not like production ever gets easi (1)

timeOday (582209) | more than 7 years ago | (#17917270)

It's clear that no one would pay $1300 for a C64 these days because computers have gotten so much faster for the money. But what's the comparison with music?
Downloads, obviously. We don't need the manufactured media or the expensive shopping mall shelf space anymore. We don't even want it.

In Other News... (1)

$RANDOMLUSER (804576) | more than 7 years ago | (#17916778)

We didn't say you were paranoid, you must have imagined that.

Re:In Other News... (0, Flamebait)

alfs boner (963844) | more than 7 years ago | (#17916914)

Go fuck yourself, dickface.

Re:In Other News... (-1, Flamebait)

Anonymous Coward | more than 7 years ago | (#17917004)

Sure, as soon as your daughter's done tounging my asshole.

BWHAHAHAHAhahahahahaha! (0)

Anonymous Coward | more than 7 years ago | (#17916780)

Every single Slashdotter, small and large mind alike, has only been predicting this for HOW LONG?!!?

Re:BWHAHAHAHAhahahahahaha! (0)

$RANDOMLUSER (804576) | more than 7 years ago | (#17916954)

> Every single Slashdotter, large and small minds alike...

Please, could you leave Evolution vs InteligentDesign / Linux vs Microsoft / Global Warming vs Bad Science out of at least one /. discussion??? Thanks.

Please, do raise the prices (4, Insightful)

orthancstone (665890) | more than 7 years ago | (#17916792)

Seriously, jack them up. That way, when less CDs fly off the shelves, they'll start making some good decisions on how to run the industry and actually attract customers. Throwing us tons of garbage every week for a "good price" doesn't mean they are doing us any favors.

Re:Please, do raise the prices (4, Insightful)

TheUni (1007895) | more than 7 years ago | (#17917072)

If less CDs fly off the shelves, they'll blame it on rampant piracy. Always something with these guys.

Re:Please, do raise the prices (5, Interesting)

littlerubberfeet (453565) | more than 7 years ago | (#17917158)

I agree, but for a slightly different reason. I want the RIAA to jack prices through the roof. Our wonderful market economy would then allow indie record companies and artists to undercut the "cartel". That would actually be the best scenario I could think of.

As it is, many of the indie artists I have worked with, and in some cases, recorded, price their records below the RIAA retail range of $16-$22, so they can sell more. A huge number of indie CDs are $10-$15, which is much more in line with what the market will bear.

The RIAA will not make good decisions. They want the market to react to it. They don't want to react to the market. As long as they view the industry that way, they will continue making bad decisions.

So let them.

Re:Please, do raise the prices (1)

bennomatic (691188) | more than 7 years ago | (#17917202)

This is the post I wanted to make. I totally agree with you. I also like the fact that they totally ignore the decrease in cost to them for making the product. If it costs a big-4 record company $0.25 to make a CD (in bulk), I'd be really surprised. This compared with (probably) $5.00 in the early 80s... I wish I knew the actual numbers, but I don't. But my gut feeling says to tell those guys (and gals) to go ahead and do what they want. The world is crying out for an "open source" music industry association...

Raise the cost of a CD to $33.00 and just see what happens...

reducing piracy and boosting sales (0)

Anonymous Coward | more than 7 years ago | (#17916822)

If record companies really wanted to reduce piracy and boost sales, I think a good move would be lowering CD prices. Their downfall will be greed if they increase the prices.

Wow, call the media! (1)

ottffssent (18387) | more than 7 years ago | (#17916824)

A mature, end-of-life technology is cheaper than it was at its introduction? I'm astounded!

Obviously these people are being given too much money if this is what they're spending it on.

Yup (2, Interesting)

Xiph (723935) | more than 7 years ago | (#17916836)

That's absolutely right, compared to 1983, the relative price is down, early adopters pay a price!
Thats an age old truth.

Now, thanks to economies of scale and lots of hours of research, it's much cheaper to produce the individual cd.
Not only that, due to IT it is also cheaper to produce the individual album.

I'm still waiting for legally downloadable music to be as problem free and cheap as the distribution method should allow.
until then, Happy Mp3.com. (yes i stopped buying cds the first time i got a malware loaded cd).
The distribution is already a lot cheaper, which means that the price has to cover three things: Development of the site, music production and marketing.
Please lower the price and drop the drm.

the cost stuff (3, Interesting)

intthis (525681) | more than 7 years ago | (#17916838)

why does it seem like every week the riaa has some new, bizarre claim about the cost of music, or some completely inane justification for them to charge us all more money for our cds? i spend a good portion of my life in studios, and while it does cost quite a lot of money to record / produce / master a big commercial release, there's no way that a cd would ever cost $33... but then again, i don't work for the riaa, so i probably don't know the 'real' truth...

It doesn't matter (3, Insightful)

yotto (590067) | more than 7 years ago | (#17916842)

I still won't buy them.

Re:It doesn't matter (1)

Jerry Rivers (881171) | more than 7 years ago | (#17916932)

"I still won't buy them."

Me either. Leave them to the collectors and audiophiles.

I'm rich!! (5, Funny)

AmigaHeretic (991368) | more than 7 years ago | (#17916848)

My pirated music collection just tripled in value! I guess it's worth the trouble to back it all up to DVDs now.

Value has gone down considerably. (1)

Technician (215283) | more than 7 years ago | (#17916860)

"The folks over at Techdirt just put up a great story today, with the RIAA claiming the cost of a CD has gone down significantly relative to the consumer price index.

Since the value has gone down considerably, market forces should cause the price to fall. The industry does not push quality, they push loud (compressed clipped recordings) over dynamic range and signal to noise ratio. They also push DRM further reducing value (CD may hose my computer, won't play in the car, and won't rip to my iPod). The biggie is ther is competition to the disposable dollar in games, DVD's, other toys such as cell phones and broadband internet that take away from CD buying dollars. When I spend $60 a month for broadband, there are fewer entertainment dollars left to spend on CD's. The bang for the buck just isn't there.

Now they think they are under priced? What are they smoking? Hey guys, time for a reality check. A good buggy whip adjusted for inflation should run for about $75.00, but they don't sell very well anymore. Time for a reality check.

Re:Value has gone down considerably. (1)

asifyoucare (302582) | more than 7 years ago | (#17917108)

RIAA wants CD price to go up. Of course. We need a noshitsherlock tag on this story.

Pricing and inflation?!? (4, Insightful)

wall0159 (881759) | more than 7 years ago | (#17916878)


Also, the cost of international phone calls has declined markedly since 1925. Based on inflation, we should now be paying $500/min for international calls. Don't tell the telcos!

Similarly, the cost of motor cars has come down since the Model-T Ford - they should cost $1.5 million each (based on inflation - discounting better performance these days)

Or... perhaps technology and economics has some influence on the price of things too..

How Ironic (3, Insightful)

argoff (142580) | more than 7 years ago | (#17916882)

It is the ultimate irony. The record industry is trying control information in the form of content, and the US Federal Reserve Bank is trying to control information that refelcts itself in the form of money and markets. So now the Fed is lying to us about the value of our money, and long behold it has the effect of destroying the pricing power for those who are lying to us about "protecting" artists, and branding about other lies such as saying copyrights are "property" rather than a personal regulatory monopoly.

Well, guess what. As society enters the information age, that means that information is becomming commoditized and the service value of information starts to exceed the control value. So liars who control information like Hollywood and the Fed (and Microsoft) are in serious trouble. How ironoc it is that, unlike the service sector, they will have no pricing power as they destroy each other.

Re:How Ironic (3, Insightful)

Planesdragon (210349) | more than 7 years ago | (#17917096)

So now the Fed is lying to us about the value of our money

The fed says jack and shit about the value of my money. Price Chopper, McDonald's, and Wal-Mart are where I discover the value of my dollars.

All the fed does is set a price for new money put into the system, which is after all the Fed's job. It can't lie about the "value of money" any more than McDonald's can lie about the value of the ice scraper I bought at Wal-Mart.

Well, guess what. As society enters the information age, that means that information is [becoming] commoditized and the service value of information starts to exceed the control value. So liars who control information like Hollywood and the Fed (and Microsoft) are in serious trouble. How [ironic] it is that, unlike the service sector, they will have no pricing power as they destroy each other.

Amazing, how you can use so many words and not actually say anything.

The "Digital Age", or "Information Revolution", or even "flat-earth effect", is pretty well set upon us now. And you know what? Controlling Information is still the best way to make immediate wealth. Google makes their money allegedly enabling the free flow of information, but they control their means and methods with a zeal greater than Coke ever used for their soda formula. The Chinese are building industrial powerhouses, but they're very careful to control the knowledge of the real cost and value of their operations from anyone.

So what if you can now buy music from China, software from Europe, or outsource your Russian McDonald's drive-thru to Utah. People still need to eat, sets still need to be built, and governments will still collection taxes. The "Information Age" might be as big a shift as the introduction of the counting machine and the photocopier, but it's not as big as you think.

"...and long behold..." (0)

Anonymous Coward | more than 7 years ago | (#17917164)

Uh, wtf? Did you mean "lo and behold"? Seriously, I'm not a grammar or language Nazi, but is the literacy level of Slashdot still declining? Is that even possible?

By what measure? (1)

Entropius (188861) | more than 7 years ago | (#17916892)

Is this cost per second of audio or cost per ounce of talent?

Re:By what measure? (1)

dreamlax (981973) | more than 7 years ago | (#17916982)

Neither, it's the cost of making profit.

Re:By what measure? (2, Funny)

Lucky_Norseman (682487) | more than 7 years ago | (#17917226)

In most cases the cost per ounce of talent gives a DIVISION_BY_ZERO error.

Re:By what measure? (1)

Gadget_Guy (627405) | more than 7 years ago | (#17917228)

Is this cost per second of audio or cost per ounce of talent?

My calculator just says "E" when I enter the second formula.

well, boo f*ckin' hoo! (0)

Anonymous Coward | more than 7 years ago | (#17916910)

With an RIAA mindset like that, people are becoming fed up with their repeated "cry wolf" on piracy. If the RIAA truly believes that these so-called "inflation-adjusted" prices are realistic for most of the top-40 crap out there then it's truly a wonder there isn't more piracy. sigh... after all this time, they _still_ don't get it. Hey, RIAA! It's a very simple concept - FAIR prices will always sell more music while excessive corporate greed will only breed more piracy.

Fuck the RIAA (1)

Ranger (1783) | more than 7 years ago | (#17916928)

If they really want to reduce piracy they should lower the prices of CD's even more.

Re:Fuck the RIAA (1)

1310nm (687270) | more than 7 years ago | (#17917134)

All they want to do is sell CDs. They don't even want to have DRM-laden music stores like iTunes out selling music; they want their old, familiar CD media being sold for the highest price possible.

I know it wouldn't happen, but we have GOT to get these people and those they represent out of music distribution. People need a social site for artists only, unlike Myspace, where people create profiles equal to those of bands, cluttering the atmosphere with trash. Artists need to realize their option to record music in a studio, then distribute it over the internet for a small, reasonable fee with no restrictions.

Key fact, cost of mass production (4, Informative)

zakezuke (229119) | more than 7 years ago | (#17916934)

The RIAA 'Key Facts' page claims that based on the 1983 price of CDs, the 1996 price should have been $33.86.

No, because CDs are by far cheaper to mass produce than cassettes or, in all fairness, vinyl. For a small production run of vinyl, i'd expect to spend $1.00 per disc [recordtech.com] including a paper dust cover. CDs I would expect to spend 1/2 that [communitymusician.com] with a basic sleve for a small production run. Cassette I would expect to spend double that of CD.

Yet for some reason, they sell commercial cassettes for less than a CD.

Not to speak of mastering seems to be done by some yahoo with protools.

Marketing costs (5, Interesting)

websitebroke (996163) | more than 7 years ago | (#17916940)

FTFA:

For every album released in a given year, a marketing strategy was developed to make that album stand out among the other releases that hit the market that year. Art must be designed for the CD box, and promotional materials (posters, store displays and music videos) developed and produced. For many artists, a costly concert tour is essential to promote their recordings.

How about you all agree to stop marketing the CDs and just let the people choose what they think is good, rather than trying to tell them? We'd all save millions.

Re:Marketing costs (1)

Technician (215283) | more than 7 years ago | (#17917046)

How about you all agree to stop marketing the CDs and just let the people choose what they think is good, rather than trying to tell them?

That is the problem. The consumer just doesn't get it so they have to be told. Lets face it. Consumers instead of buying CD's with their disposable income are buying games, DVD's, electronic toys such as big screen TV sets, portable music players, digital cameras, laptop computers, pay per view TV,.... It just isn't fair. They should be buyng $33.00 CD's instead like they used to. They shouldn't be buying all that other stuff instead of CD's.

Bullshit. (2, Interesting)

L4m3rthanyou (1015323) | more than 7 years ago | (#17916946)

They can't be serious. Maybe, instead of "CDs should cost more" it should be "Record execs should cost less".

After all, it's not like manufacturing cost should be an issue. Hell, my great-uncle used to work at a post office... When someone mail-ordered a CD and the address was wrong, the sender of the CD would not pay to have the package forwarded. Instead, they'd just ship another package, because this was apparently cheaper. The post office was told to throw away the CDs and wait for the subsequent re-delivery. Of course, then people began stealing the discs from the garbage, so the post office had to start DESTROYING them (by incineration, iirc) every week instead.

Long story short, when you order a CD online, the finished product cost more to ship than it did to make. The price is still totally unjustified, especially considering that the artist's cut is almost nothing.

People who exploit others for profit are the scum of the earth, and record companies scam pretty much everyone else in the music biz, from the artist all the way down to the consumer. It's disgusting.

Re:Bullshit. (1)

abscissa (136568) | more than 7 years ago | (#17917106)

They can't be serious. Maybe, instead of "CDs should cost more" it should be "Record execs should cost less".

Unfortunately fully half of all record execs make a below-average salary. This is unacceptable, they need to be paid more!

Business 1.0.1. (1)

DimGeo (694000) | more than 7 years ago | (#17916952)

What do we do when people are not buying sh*t? Raise the price and expect them to flock! Hurrah! We're brilliant!

#include <derisive_laughter.h> (5, Insightful)

ewhac (5844) | more than 7 years ago | (#17916958)

Fact: The unit cost of a single CD, silkscreened, in a jewel case, with six-page four-color liner notes, quantity 5,000: USD$0.91.

Quantity 10,000: USD$0.79.

Explain to me again why these fsckers cost $16.00?

Now then, what was the per-unit pressing cost, quantity 10,000, of a CD in 1980? If we calculate MSRP as a percentage multiplier of the raw pressing cost, what should music CDs cost today?

Schwab

Re:#include (1, Informative)

Samuel Dravis (964810) | more than 7 years ago | (#17917024)

Good point. I hardly ever buy CDs new nowadays - usually pick them up off of ebay for 1/2 or less the list price - and that seems to be a much more reasonable price than the $15 or so that the new ones cost. If they raised it much further I don't think I'd buy ANY CDs new.

Hell, that's nothing. (5, Informative)

Rimbo (139781) | more than 7 years ago | (#17917182)

That's nothing. My CD [cdbaby.com] , through a frickin' vanity effort, costs me...

(...goes to books to make sure it's the right number...)

  • $2.20 per CD for 100 shrink-wrapped, color-printed pressed CDs,
  • about $0.85 per CD in shop setup costs, amortized over the current production run of 100 CDs,
  • $0.085x2 = $0.17 per CD in artist royalties for cover songs,
  • a whopping $2 per CD to the artist for artwork (I was being generous since I knew I wouldn't sell many)
  • CD Baby's cut of $2 per CD
...for a grand total of $7.22 per CD, for a vanity run of just 100 CDs. If I don't bother with an artist for the cover art, and if I sell them myself out of the back of my station wagon, it'd be only $2.37! (Take away $2 for the artist, $2 for the store, and $0.85 per for shop setup costs.) For a small-time vanity run! That includes digital distribution through Connect, iTunes, and three dozen groups I haven't even heard of, and real CDs -- not cheesy CD-R's with cheap CD Stomper labels. Plus, I have these CDs, and can sell them myself without going through CD Baby -- the agreement with CD Baby is non-exclusive. Even with iTunes, where a big label artist gets pennies per song, I get like $0.67 per $0.99 download.

And that's with my shoddy economies of scale. I can't even imagine where the RIAA gets this kind of thinking, but I guess they gotta do what they gotta do to keep up with the price of cocaine, right? Can't imagine the weak dollar has helped them with their fine imported Columbian stuff.

Re:#include (0)

MBraynard (653724) | more than 7 years ago | (#17917216)

Hello Random Slashtard.

Just like that POS device 'Tapwave' sells for more than the cost of the actual hardware to pay for the work that went into develop it, CDs allow an artist to earn more while letting more people share the cost.

The difference is, of course, people actually want CDs, as oppose to the Tapwave which sold so well the company went into bankruptcy.

Cost Of Production Is A Very Small Amount (5, Insightful)

domukun367 (681095) | more than 7 years ago | (#17916966)

Ben Woods' argument is correct, if we are talking about a piece of electronics, where, say, 90% of the cost of that piece of electronics is in the production. However, only a very small amount of the cost of the cd (less than 1% if 1c for the CD and 3c for the case/cover) is in the PRODUCTION of the CD.

Most of the cost of a CD is in the marketing and (of course) profits for the record company. Sure there are a few extras, like the pittance they give the artist, but the majority of the cost is MARKETING. This gets more and more expensive as they get more and more ridiculous in their marketing and the cost of marketing increases over time.

Another spin might be that CDs are now more expensive to produce due to all the non-redbook copy prevention measures that they keep trying to put on "CDs" now.

overpriced (2, Funny)

mqduck (232646) | more than 7 years ago | (#17916976)

Me, I tagged the story "overpriced".

Awesome (1)

friedman101 (618627) | more than 7 years ago | (#17916990)

Another reasonable and well thought out claim from the RIAA. Someone inform Intel that a single transistor should still cost about a dollar, they're losing money by the fistful.

All I want to know (1)

nytes (231372) | more than 7 years ago | (#17917000)

All I want to know is:
1) What is the average recording company executive salary compared to the inflation rate?
2) How does that compare to the compensation given to the (poor, trodden-upon-by-the-evil-copyright-infringers) recording artists?

The RIAA is so smart (0)

Anonymous Coward | more than 7 years ago | (#17917026)

Yeah, let's charge ONE MILLION DOLLAR for a CD, so they can claim they make an even bigger loss by people illegally downloading music from the internet.

Pure BS (4, Insightful)

soren100 (63191) | more than 7 years ago | (#17917040)

This is one of the most laughable things I have ever heard.

CD prices were always higher than the equivalent cassette tape, which was much more complicated to produce and had the same production and marketing costs.

FTA: For example, when you hear a song played on the radio -- that didn't just happen! Labels make investments in artists by paying for both the production and the promotion of the album, and promotion is very expensive.

The only thing that gets played on the radio is the latest Britney Spears bubblegum crap-ola. In fact, Mandy Moore recently apologized for making such bad music [cinemablend.com]

So we have to pay for all the payola [dontbuycds.org] in getting the radio stations bribed [slashdot.org] to play the songs on the radio.

And then when a CD gets scratched, broken, or stolen, do we get a free replacement? Oh no, we have to pay the full retail cost all over again even though the RIAA wants us to think that we have somehow "licensed" the music from them.

I am glad that they are sweating, which they must be in order to be trying to play the "victim" game. The days of the Internet are here to stay, and bands can finally distribute their own music without getting shafted.

In the linked article it says that only 10% of all CD's make a profit. The other 90% of CD's put the bands into debt to the record companies, making it a really bad deal to sign a record contract. Courtney Love does the math. [salon.com]

The RIAA sounds desperate, and I hope they are -- it would serve them right.

"Secret" RIAA Conference (2, Funny)

StarWreck (695075) | more than 7 years ago | (#17917044)

Record Industry Meets in Las Vegas for Conference
Reuters

Record Industry Execs from all four major record labels are meeting in Las Vegas, Nevada today to discuss the future of of CD sales. Wild speculation indicates that CD prices will be lowered due to increased competitive pressure from online sources.

...

Sony-BMG Sales Tycoon Oliver Klosoff was quoted as he left the conference hall "I'm happy with our new pricing figures. They will be considerably lower than our original 1986 prices after inflation is taken into account." He also added "We are also planning to implement Iraq insurgency style death-squads to manage any record store that fails to adhere to our strict $33.86 per CD policy."

...

UMG Chief Executive, Holden Magroin, stopped shortly to answer reporters questions. When asked to explain how the record industry hopes to enforce its strict pricing policy after facing multiple price fixing allegations, Mr. Magroin responded by having a hit placed on the reporters family.

Just because... (0)

Anonymous Coward | more than 7 years ago | (#17917058)

Just because gas prices are going up (and most everything else of course), then we should also be paying more for CDs which are continuously cheaper to produce...is that the RIAA is telling us?

What about the guy who makes my burgers? (1)

JAB Creations (999510) | more than 7 years ago | (#17917066)

If the price of a CD should be $33 then the wage for the dude who screws up my burger should be roughly $20. Corporate America created piracy because no one in their right mind is going to walk in to a mall and buy three CDs for a hundred dollars at FYE. Three episodes on a single DVD for Dragon Ball Z for over $20? That's little 14 year old Jimmy's allowance for the rest of the month burned on roughly 60-70 minutes of entertainment. The people who own and run the big media companies are not our friends and do not have our best interests in mind. Flame? No, truth. Besides, I can't even watch the History channel anymore without hearing blatant bias even by the narrator much less swallow the vast majority of stuff that comes out. Plus it's overwhelmingly discriminatory against most people such as myself but most people will never awaken to that because you see it so much you must assume it's normal.

hmmm I thought it was a free market (1)

ILuvRamen (1026668) | more than 7 years ago | (#17917068)

I could have sworn that in a free market, the price of any product "should be" what buyers are willing to pay for it. I think the RIAA idiots need to go back to economics class.

Post-scarcity needs getting used to (5, Insightful)

Glowing Fish (155236) | more than 7 years ago | (#17917070)

If you look at most computer or home electronic prices, the trend has been downwards over the past twenty years. Not only downwards when adjusted for inflation, downwards when adjusted for performance, but downwards in absolute prices. I wish I had stronger memories and figures to back this up, but I do remember as a child, (I was born in 1979), people just had a wildly different attitude towards electronics. A VCR, cable television, a microwave oven, color TVs...all of these were important luxury items. This could be just a artifact of me growing up, but a color television set was on par with say, a grand piano as far as how expensive it seemed.
I do have better data for computers. I have a 1994 price guide to computers when bottom line computers, 386s cost around 1500 dollars, twice as much as a midrange new desktop would today.
All of this is stuff most readers here know. (Although I am expecting at least a few people will correct my specifics.)
What I have noticed, however, is that many people have not psychologically adjusted to this, even when they intellectually know it is the case. I have noticed this most at my work at Free Geek [freegeek.org] , where often people come in, with a Packard-Bell Pentium, and explain at some detail that the quad speed CD Drive works, if you just wiggle it around first. Or that their 14 inch monitor still works, but it might blink off every few minutes. Meanwhile, we get truckloads of P-4 systems every few days.
The point is, I think many people (often older people, but not always that much older), still have a mindset that computer and electronics are rare and valuable, instead of being the mass-produced, quickly obsolete, pieces of junk they are. And I think that many of these people are honestly confused about how valuable their product is. Of course, the RIAA people know that AOL mails out millions of CDs a month (do they still do that?), and that CDs cost "under 1 dollar to make" ( wikipedia on CD manufacturing [wikipedia.org] ). Of course they know these things intellectually, but I really do think they have a mindset that they are producing a rare and valuable resource, and that they aren't asking for much in that they haven't raised their prices with inflation.

Post-scarcity takes some getting used to. I consider the entertainment industries inability to come up with a more financing method that doesn't involve creating false scarcity to be one of the less harmful inabilities to adjust to a new paradigm. I consider the fact that the US political and industrial leaders really don't understand (even though they know) that the US has lost textiles 50 years ago, consumer items 40 years ago, vehicle manufacturing 30 years ago, electronic manufacturing 20 years ago and computer manufacturing 10 years ago (numbers somewhat generalized), and that all of those things are now produced overseas for a fraction of a US worker's hourly minimum wage, to be a much more dangerous symptom of the same disease.

Re:Post-scarcity needs getting used to (1)

scoot80 (1017822) | more than 7 years ago | (#17917146)

I'm sure the prices go down over time, but most definitely I spend more on computers as I get older...

RIAA = Anti-Free Market? (2, Insightful)

MSTCrow5429 (642744) | more than 7 years ago | (#17917076)

Maybe the RIAA doesn't believe in free-market economics, but the price of a product follows the S-curve, and should drop from its introduction price, not stay there forever. Lunacy to expect or whine that a product should remain in the "early adopter" phase of the S-curve for the life of the product.

RIAA Get Your Head Outa Your Asses! (1)

EonBlueApocalypse (1029220) | more than 7 years ago | (#17917094)

Rarely do I find music worth even 12 dollars. I decided long ago that I will never spend money to potentially find new music that I'd enjoy listening to. Two reasons - 1. It already cost to much and 2. Is there enough of a risk that I will probably never listen to the artist again. Now there are a three or four bands that I wouldn't mind dishing out 30 bucks for a album but I believe they deserve every penny. I only found out about these bands by I suppose questionably unlawful means. Though as soon as I found a truly special/original/talented band I have purchased everything I've wanted to own of theirs. Everything else has either been deleted or has rarely/never been listened to again. The RIAA really has its or I suppose their head up there asses if they plan to implement this, and how exactly do they expect to sell really anything at all? People will rarely start purchasing music for artists they even like let alone take a risk on an artist they have never even heard. This may be a good thing with the whole down with the RIAA dealy but still the stupidity amazes me.

DVDs (0)

Anonymous Coward | more than 7 years ago | (#17917100)

I buy more DVDs than CDs. I feel DVDs give me more value for my entertainment money.

the sound track costs more than the movie! (0)

Anonymous Coward | more than 7 years ago | (#17917104)

jacking up the price of CDs is ridiculous. think about it: why does the sound track cost $18, but the movie on DVD with all the songs costs $11!???

Follow Ozzy's lead (1)

updog (608318) | more than 7 years ago | (#17917150)

Just announced: Ozzfest will be FREE [mercurynews.com] this year!

Quote: "I'm the biggest money whore in the world,' Osbourne told me. "I love it. But it's time to stop."

She said greed was killing the concert business, and the bubble was about to burst, as it did in the music industry.

The record companies need to think out of the box regarding CD sales as well, not claim that they're underpriced...

Re:Follow Ozzy's lead (1, Funny)

Anonymous Coward | more than 7 years ago | (#17917278)

Bad news, a Burger and Coke at Ozzfest is now $175.

1996 - 2007 (1)

MSTCrow5429 (642744) | more than 7 years ago | (#17917154)

According to the Federal Reserve Bank of Minneapolis' Inflation Calculator (http://minneapolisfed.org/research/data/us/calc/) , $33.86 1996 would be $44.35 in 2007 dollars.

And by that premise... (1)

rainman_bc (735332) | more than 7 years ago | (#17917168)

By that premise a computer in 1983 should cost how much by today's standards?

And an 8-track in the 1970-s should be worth how much today according to said logic?

Not everything appreciates according to inflation. Stick it in your pie hole RIAA. Raise the price to $33 a CD and let's see how fast an exodus from the CD market consumers make.

PC's should cost more too, by that reasoning (1)

dtfinch (661405) | more than 7 years ago | (#17917172)

A 4.77mhz 8086 with 64kb ram and a 360kb floppy drive maybe cost around $3000 in 1982 (I was a newborn then, so I don't remember the exact numbers).
So today, an equivalent system should cost about $6000, based on the CPI. But since today's desktops are typically 10000 as fast, have 10000x the ram, and hard disks up to over 2 million times the size of a floppy, only the richest people in the world should be able to afford one.

Corporate math (4, Insightful)

Bullfish (858648) | more than 7 years ago | (#17917180)

You have to understand corporate math. That math says that if you made 15 million in profit in year one, and 10 million in year 2, then you have taken a 5 million loss in that second year. That thinking convolutes all kinds of statistics.

Weren't they already... (1)

ziggyzig (944029) | more than 7 years ago | (#17917194)

accused of pricefixing them arbitrarily higher just a few years ago?

-RIAA ...pfft ! (1)

goga_russian (544604) | more than 7 years ago | (#17917204)

-RIAA does not manufacture CD's . story over. then again there would be always net stores or orders straight from china.

My responce (1)

gbobeck (926553) | more than 7 years ago | (#17917206)

RIAA Says CDs Should Cost More
My response... "Random graduate student declares the RIAA can eat his ass."

What's with the "Related Stories" link? (1)

mh101 (620659) | more than 7 years ago | (#17917210)

When I view this story, titled RIAA Says CDs Should Cost More, the "Related Stories" section has a link to a story titled Blockbuster Sued Over Late Fees Claim. Are the Related Stories hand-picked, or does Slashdot have a search engine that uses an algorithm to find stories that it thinks are related?

Usually, the related stories are related in some way, such as the Jobs Favors DRM-Free Music Distribution story listing EU Countries Call Out iTunes DRM as a related story, which makes perfect sense. But how does a story about Blockbuster getting sued over late fees get flagged as being related to the RIAA saying CDs should cost more?

Bleeding Edge (1)

adambha (1048538) | more than 7 years ago | (#17917256)

So, let's see here.

How ubiquitous was the CD in 1983? Hardly. It was a bleeding edge product and was high priced, as all bleeding edge products are.

When HDTV was introduced in 1998 [time.com] prices were around $6,000 - $9,000.

So by that standard, prices should be around $10,000 - $15,000 today.

Oh, the RIAA reminds me that:

"He uses statistics as a drunken man uses lamp posts--for support rather than for illumination." ~Andrew Lang

Computers are overpriced! (1)

atcurtis (191512) | more than 7 years ago | (#17917272)

What would happen if the computer industry priced their products today based on RIAA illogic...

In 1986, My IBM PC 5150 cost $2000 for 4.77MHz of performance.

Adjusted for inflation and applicable linear price increase for the extra MHz:

In 2007, a 2.0GHz computer should cost $1561700.

Yeah, right.
Load More Comments
Slashdot Account

Need an Account?

Forgot your password?

Don't worry, we never post anything without your permission.

Submission Text Formatting Tips

We support a small subset of HTML, namely these tags:

  • b
  • i
  • p
  • br
  • a
  • ol
  • ul
  • li
  • dl
  • dt
  • dd
  • em
  • strong
  • tt
  • blockquote
  • div
  • quote
  • ecode

"ecode" can be used for code snippets, for example:

<ecode>    while(1) { do_something(); } </ecode>
Create a Slashdot Account

Loading...