New laws create second-hand woes for CD retailers

[sventvkg]

http://news.yahoo.com/s/nm/20070505/music_nm/used_dc;_ylt=AhHrUp4Wjl2gzNriJaKpwfxxFb8C

 

This is insanity....

[UstadKhanAli]

We're talking about used CDs, right? Compact discs? Not plants brought in from over the border or marijuana? We have insane people at the wheel here....

[ggm1960]

I can't see the agenda? Who initiated this crap and why?

[MikeRivers]

Who knows? Maybe there's heavy trafficin stolen CDs. Or it may be an anti-piracy thing where people have been making pirate CDs and selling them as "used."

 

For a while, there was a fuss raised by the songwriters (who were most often the artists) when they realized that they weren't getting their royalties on a second-hand sale.

[Alan Roberts]

It looks like it's an effort to get pawn shops to stop paying out cash, but the law got worded just a little too loosely so that it can be interpreted as any business buying used goods. If that's the case then it may also effect how used music gear gets bought and sold, too.

[Anderton]

That was a spoof page, right? Right?!?

[EnemyofSilence]

 

That was a spoof page, right? Right?!?

 

 

Sadly, no.

[Super 8]

It sounds a lot like a way to deal with stolen CD's ending up on the shelves. I don't doubt that this is a real problem especially on college campuses , although the last time I was at my old school most of the CD stores were closed. It's probably a bigger issue with DVD's and video games.

 

It seems a little over the top though.

[Cry Logic]

"At least one Florida town has enforced the law,

resulting in the cited merchant pulling used CDs

from its store."

 

This is just another nail in the coffin for CDs as a storage

medium for music.

If they stop people from buying & selling CDs then they will

simply get their music elsewhere.

(Which they are doing already )

[Frantag]

This is another piece of the RIAA agenda.

[Hard Truth]

My impression is that a large portion of the merchandise in pawn shops is stolen. I suspect this because I have experienced that the shops do not pay a reasonable amount for the stuff they buy, only a very desperate person would sell at the prices they offer. The police don't seem very interested in policing pawn shops.

 

I would guess that these laws were intended to target pawnshops but were poorly written. I do think it is suspicious when people sell a couple of hundred discs at once to used record stores. I would hope that the stores would take some steps to record the identity of the sellers and the list of discs sold, but that is only necessary for large sales.

[Super 8]

 

This is another piece of the RIAA agenda.

 

 

I have my doubts about that. I really don't see what the RIAA is getting out of it.

[lowbasslowbass]

People don't understand (or pretend that they don't understand) that when you buy a cd, you don't own the music in it - you just pay for a license to listen to the material.

[Frantag]

 

I have my doubts about that. I really don't see what the RIAA is getting out of it.

 

 

The companies they represent lose sales and royalties for every resold CD. They reaason and probably correctly that if a person buys a used CD, they lose the sale of a new one. They've pushed legislation in several states since the early nineties to make selling used CDs in retail outlets illegal. And they have also promoted legislation that would require used CD retailers to pay a fee to record companies in order to sell used CDs. Nothing has passed until we see the above article...

[spokenward]

The Yahoo story is sourced from Billboard.

 

NARM meeting - Billboard story May 1

 

In the 90's labels withheld co-op ad dollars from stores selling Used CDs. So there is precedent for Frantag's view. The article makes a reference to this-

 

 

Laws that result in the curtailment of used CD sales likely would be considered good news to record labels and music distributor executives who have long abhorred the growing strength of the used CD market. In fact, until the mid-1990's labels used to put pressure on merchants who bought directly from them not to carry such merchants. At the time, some majors attempted to kill the strategy by initiating new policies to withhold cooperative advertising from retailers buying directly from them but selling used CDs, a move endorsed by some artists including Garth Brooks.

 

 

but that is not what is happening this time around. NARM is a retail trade group for record retailers. They are not representative of the labels' views. Labels make presentations at NARM, but NARM is a retail group with a different set of interests.

 

 

Since then, merchants who buy direct from majors who participate in the category say that used CD sales have grown from about 5% to sometimes 10%-20% of overall CD revenues. Also, those sales are more profitable. Traditionally, used CD sales are protected by first-sale doctrine in copyright laws allow owners to resell CDs, according to Mitchell.

 

 

This looks just like bad law aimed at second-hand goods in general. States like Florida may have an obsession about money-laundering that makes this appealing. And just think - if Florida law enforcement had had a tool like this prior to 9/11 we could be learning about Mohamed Atta's Creed CDs.