Monday, April 05, 2004

MORE BOLLOCKS FROM THE BPI: Why does a download cost more if you buy it from a legal British download site than an American one? Because the theiving shysters can get away with it, of course. It really is that simple. But, of course, they can't say that, so the BPI have worked up a new justification:

"The US benefit from a) Greater economies of scale b) Smaller sales tax (6% as opposed to 25% in some places in Europe) and c) Lower costs,” argues Matt Phillips from the BPI."

Greater economies of scale? Is this to be a new factor we should be using when we work out if a record is good value? Only at the moment, BPI members don't bother to reduce prices of the biggest selling singles - Kylie records enjoy far greater economies of scale than Victoria Beck... (sorry, it'll be Victoria Adams again, won't it) Adam's records, and yet the prices don't seem to reflect this.

Taxes? But records are cheaper in continental Europe where sales taxes do, indeed, rise as high as 25 per cent, whereas in Britain CDs cost more and the VAT rate isn't as high; likewise, sales tax in the US varies from State to State (the BPI's figure of six per cent is plucked at random - it varies from zero in Alaska to 7.25% in California) and yet the price of a download is uniform right across the country - because on ninety nine cents, we're talking piddling little differences.

And lower costs? But with downloads, the costs of additional sales are almost zero - a tiny bit of computer bandwidth, a sliver of storage. The main costs are in the production, and the cost of The Rolling Stones making a track that sells in the US are identical to those of making a track for the British market. And, the other beauty of downloads is the company can site itself wherever it chooses, wherever costs are lowest - are we expected to believe that MyCokeMusic has got all its servers in Britain?

No, we suspect the real difference between the British and American markets, the thing that really distorts the prices, is the huge mark-up. But when they try and sell it to us, they could at least try and come up with something a bit more convincing.


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