This would be my justification.

Yet another reason why the music companies suck beans

from yahoo


Labels to Pay $143 Million in CD Price-Fixing Case
Mon Sep 30,11:47 PM ET
By Derek Caney

NEW YORK (Reuters) - The world's five largest music companies and the three largest music retailers will pay $143.1 million to settle a CD price-fixing case launched by New York and Florida two years ago, New York State Attorney General Eliot Spitzer said on Monday.



In August 2000, most U.S. states joined in a lawsuit alleging that an industry practice called "minimum advertised pricing" (MAP) artificially inflated the price of CDs between 1995 and 2000, violating federal and state antitrust laws.

Under MAP, the labels subsidized advertising for retailers that agreed not to sell CDs below a certain price.

The five record labels -- Vivendi Universal's Universal Music Group, Sony Corp ( news - web sites).'s Sony Music, Bertelsmann AG ( news - web sites)'s BMG Music Group, Warner Music Group, a division of AOL Time Warner Inc. and EMI Group Plc ( news - web sites) -- and the three retailers, Musicland Stores Corp., Trans World Entertainment Corp. and Tower Records, agreed to stop using MAP policies as part of the settlement.

The companies, which did not admit any wrongdoing, will pay $67.4 million in cash to compensate consumers who overpaid for CDs between 1995 and 2000. The companies also agreed to distribute $75.7 million worth of CDs to public entities and nonprofit organizations throughout the country.

"This is a landmark settlement to address years of illegal price fixing," Spitzer said in a statement. "Our agreement will provide consumers with substantial refunds and result in the distribution of a wide variety of recordings for use in our schools and communities."

MAKES MORE SENSE TO SETTLE

John Sullivan, chief financial officer of Trans World said, "It's always been absurd to us to even be involved in this case. Given the cost of lengthy litigation, it made more sense for us to settle the case." Trans World owns the FYE and Coconuts music chains.

Universal Music Group, the world's largest record company said it believes MAP policies were legal, although it wanted to avoid the cost of lengthy litigation. "We believe our policies were pro-competitive and geared toward keeping more retailers, large and small, in business," the company said in a statement.

BMG and Warner Music each issued similar statements.

In a May 2000 settlement with the U.S. Federal Trade Commission, the five labels agreed to ban the MAP policy for seven years. The settlement did not require the labels to pay any damages, nor did the labels admit any wrongdoing.

In the mid-1990s, large department stores and consumer electronics retailers began selling CDs below cost as a "loss leader," in an effort to get people into the store to buy big-ticket items, the labels have said in the past.

The labels have said MAP policy helped smaller retailers compete with chains like Wal-Mart Stores Inc., Circuit City Stores Inc. and Best Buy Co. Inc. . They argued that smaller retailers do not have the option of offsetting losses from cut-price CD sales with the sale of other products.

The labels have said they received no financial gain from the MAP policy, noting that the wholesale price charged to retailers was the same whether or not they participated in the policy.

How will consumers get a piece of this money?

Doesn't Best Buy own Musicland Stores. Corp?

That is what sucks - sure, they pay a fine for ripping off consumers, but will the consumers see a dime? Will current cd prices drop to where they should have been all along? I doubt it.

F&ck the record companie$

Um, they settled and will stop using the MAP. So I would thinkthat somehow customers will see the money and that CD prices will drop as stores no longer agree to a MAP and will thus have more competition. Unless the music companies raise the cost of CDs going to the stores in the first place. bastards...

The worst thing is this: The record companies bilked the consumer out of almost 400 billion. Out of that, they will have to pay back $143 million, and they do not have to admit to any wrongdoing. On top of that, half of it is in free CDs, which will be calculated at the retail price, not the wholesale price or the price of production. Add to that, there's no stipulation about which titles must be given away, so the record companies could just unload some old backstock of something like Milli Vanilli's Greatest Hits.

Forgive me, but I don't see where the punishment is.

Probably better than nothing.

... and this is why I won't ever purchase another cd at full price.

I will either download it, or purchase used.

fcuk them.

-k
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