The Australian Government wants to change the copyright law to "drop the
price of cd's".
How will changing the copyright law effect a change in price? This is a
question the government can't really answer. They say that allowing
retailers access to cheaper imports that the price will drop. From most of
our experience in the dance area since when has a full price cd from the UK
or the US been cheaper than the Australian manufactured price (except
throught the net)? Not often.
The only cheap cds from the US will be deletions (which are illegal to sell
and will not be paying artist royaties) pirate copies (ditto) and the large
US chain price. This 3rd source will be when the either large US retail
chains move into Australia and bring with them their economies of scale
(when they buy CDs made in the US) and directly ship these large quanties
of 'product', or the other option will be large buying groups such as HMV
buying and squeezing the record companies internationally for a cheap
price. This happened recently in Europe where The Prodigy's label XL
Records was being squeezed by a large chain who was threaten XL that if
they did not drop their price they would not buy the record at all from
them (XL) and buy it instead from an unnamed Eastern European manufacturer.
In Russia piracy accounts for about 80% of the market. Now all this may be
good in the short term as far as price for cds, but it is incredible bad
for record companies of any persusion and really bad for artists cause the
first to go in most of these transactions is the artist royalties. In
australia it will be very bad for small retailers who stock all titles, all
record companies, all companies and people that licence artists for
australia and manufacturers.
What there (the gov) are proposing is to abolish the rights of owners of
master recording copyrights from controlling the exclusive rights to sell
the recording in Australia. This means a number of things. For example
Central Station will not be able to stop MDS from importing 10,000 copies
of the new Klubheads record. Central Station will no doubt not bother with
manufacturing here for this very reason and will also import just to stop
Mds (or whoever) from importing it themselves. The freight costs and price
of buying a finished cd from Holland will make the cd single $10 instead of
$7. It means that this cd doesnot get made in Australia. Another example
would be say Pendulum get a deal for their album in the US with some medium
sized company. The US company (the size and type of company is irrelevant,
it could be a Smile or an RCA) presses 100,000 albums in anticipation that
its going to be huge. It ships 80,000 to stores and has 20,000 left. The
album doesn't do so well cause the single never got commercial FM radio.
So the album does sell as well as expected nor do retailers order anymore
cause the stock they have is still in the store. In fact 10,000 get
returned to the record company unsold. This leaves the record company with
30,000 Pendulum albums. It then gets deleted in the US. All artist royaties
are no longer payable on these deletions. These deletions which cannot get
sold in the US BUT can now get sold and shipped 'LEGALLY' to Australia and
sold minus the artist royalty. The price is cheaper to the retailer here
rather than buying it off Mds / Vicious in Australia. Mds / Vicious have to
pay artist royalty and sales tax included in the wholesale price of the
Australian version. Under the proposed changes to Copyright Law Mds will
not be able to stop what is illegal in the US from being shipped and sold
Mds will lose a lot of money from this type of transction. They may
eventually go out of the business of licencing records from OS cause its
too risky, they may also stop trying to sell their artists OS cause it just
isn't worth it coming back into the country.
Also for a record comapny if there is no gareentee that the retailer will
buy your release casue they can get it from their head office in Ney York
or China cheaper (cause it has no asles tax and royalties) then the said
record company will not be spending money on marketing and promotion. This
directly effects spending at Street press, radio advertising, TV ads,
fylers, street posters etc..
There will be less money spent in Australia promoting music!
The government is saying this will change of the copyright law will drop
prices from the so-called expensive point they are now at...
In 1993 Australian CD wholesale prices were the 5th cheapest amounst 23
countries surveyed. 1997 remains the same. In Australia there is Government
sales tax included in the wholesale price BY LAW.
In the US, sales tax is lower and is paid after the purchase, and so is
songwriter royalties. When (Australia gov.) people mention the US cheaper
prices they also forget to mention that the retailer then adds his own post
sale tax. Australia has a mandatory songwriter royalty included in the
In 1996 Choice mag. compared the average cd full prices. In the US the
price was $23.95 without the sales tax and songwriter royalty. In
Australia the Average price was (in 1996) $27.00 including the sales tax
and songwriter royalty.
Australia is a much smaller market and will never have the economies of
scale that the US does. In Australia most titles are already discounted.
So when is something too expensive? Are record companies making too much
money (That includes major and indie labels)? Is a Playstation game cheap
or expensive. It too is a cd and sells for twice as much as a music cd! If
the Goverment really believes that the price of a music cd is too expensive
why don't they drop the sales tax? Is a pair of Nikes too expensive? They
cost fuck all to make? And we pay $100-200 for a pair of latex and fabric
shoes! What is really going on here?
So why is the government changing a law that benefits some consumers, some
Multi-national retailers and the multi national music companies
ex-Australia short term but creates havoc for lots of people and
potentially destroys the Australia music production, manufacturing,
licencing, music media and more???
The only reason I can think is that it's an easy target for a Government
that is fucking up. This way they can go round saying 'WE ARE GOING TO DROP
THE PRICES OF CD FOR YOU ALL" and not answer the real questions.
Imports are already available. This is not an issue.