Universal vs. Retail

Music Retailers Slow to Adopt Plan to Lower Price of CD’s [pdf]

A month after Universal Music announced it was cutting CD prices by as much as 30 percent, shoppers looking for the results in the aisles of music stores may be coming away disappointed.

Retailers, many of them angry over details of the plan that may hurt their profit margins, are instituting the price changes slowly and unevenly. A result is a patchwork of prices, ranging from less than $10 to nearly $16, on new Universal CD’s from artists like Ludacris and Edie Brickell. At least one major retailer, Virgin Megastore, has refused to comply with the plan that lowers the wholesale price and eliminates promotional subsidies, selling new Universal CD’s like Ludacris’s “Chicken & Beer” for $15.99. Others, like the HMV chain, have clambered on board, selling “Chicken & Beer” and other Universal titles for the new suggested list price of less than $13. Other deep discounters, including Wal-Mart and Best Buy, have stuck near their customary prices of just under $10.

The result has muted the effect of the price plan, setting the stage for a new battle next month when Universal Music, part of Vivendi Universal, begins an advertising campaign telling consumers to look for the lowered prices at cooperating stores.

The W3C Supports MS in the Eolas Suit

Hmmm — missed this news yesterday – Web Group Backs Microsoft in Patent Suit [pdf]

A leading Internet standards-setting organization took the unusual step yesterday of urging the director of the United States Patent and Trademark Office to invalidate a software patent that the group says threatens the development of the World Wide Web.

[…] The Web group contends that the patent based on work done by Michael Doyle, founder of Eolas Technologies in Chicago, while he was an adjunct professor at the University of California at San Francisco, was improperly granted. In a filing with the patent office, the Web consortium asserts that the ideas in the Eolas patent had previously been published as prior art, a legal term. That prior art was not considered when the patent was granted, or in the Microsoft trial, and thus the patent claims should be invalidated, the consortium contends.

In a long letter yesterday, Tim Berners-Lee, the consortium director, who created the basic software standards for the Web, said the patent office should begin a review of the patent “to prevent substantial economic and technical damage to the operation of the World Wide Web.”

In his letter to James E. Rogan, director of the patent office, Mr. Berners-Lee repeatedly emphasized the wider public interest in a review of the patent. If the claims in the patent are upheld and enforced, Mr. Berners-Lee warned, “the cycle of innovation on the Web would be substantially retarded.” Later, he wrote that the patent, if unchallenged, represented “a substantial setback for global interoperability and the success of the open Web.”

A Look at the Online Music Biz

Neil Strauss describes just how messy it’s become: Online Music Business, Neither Quick Nor Sure [pdf]

In the last decade a new record business has been forming online. It has been coalescing by trial and error, largely error. And its evolution is in no way complete as it moves toward a finish line at the rate of one step forward for every nine-tenths of a step back.

[…] Clearly, Sonicnet’s music store was more of a me-first venture than a moneymaker, but the message was clear: the Internet was a place for artists to control and directly profit from their music. But in most online services today that dream has been lost, with the services functioning as online arms of the record companies while the artists receive pennies (or fractions of pennies) for each download.

The second dream from the golden age of music downloading was summarized in a catchphrase: All you can eat. The future of the business was in allowing fans access to all the music they wanted for a monthly fee. So far, only the free unauthorized services have accomplished this, chiefly ones that are now defunct, like Napster and Audiogalaxy. The reason the authorized downloading services haven’t accomplished this goal is not because the technology or will is lacking, but because full cooperation from record labels and publishers has not been forthcoming. They fear they would become obsolete.

Thus the authorized services online today are all compromises.

Tennessee’s Super DMCA

Slashdot discusses yesterday’s hearing on the Tennessee Super-DMCA bill: Tennessee’s Super-DMCA Rises From The Grave. Notes from the hearing: 10/28/2003 Joint Committee Hearing Notes

The next speaker was Todd Flournoy, Counsel and Director of State Legislative Affairs for the MPAA. “On behalf of Jack Valenti, I thank you for this opportunity,” he intoned. He explained that the MPAA’s members were becoming increasingly involved with digital distribution of their content, and that “If we can’t get a handle on Internet piracy, there won’t be a content industry.”

Senator Trail asked Flournoy what specific services were not covered in the current statutes. Flournoy replied that there wasn’t specific coverage of Internet and digital services. Senator Trail answered that it didn’t seem necessary to mention every possible service by name since the current law covers essentially all imaginable forms of electronic communication. At that point, Representative Briley (the bill’s sponsor) said that for that matter, we could just abolish the whole criminal code and replace it with a law that said simply “Do no harm.” Senator Trail responded that he advocated no such thing, only that the solution to a supposedly inadequate law was not necessarily more bad law.

See more at the Tennessee Digital Freedom Forum. The EFF link above has the text of the bill.

Napster Goes Live Today

Napster is ready to roll. Now to see what comes of brand name recognition.