Webmaster rambling and mental notes
Must a CD Cost $15.99?
3/26/2008

Scionite0 sends us to Rolling Stone for an superficial article on Wal-Mart and the music business. Wal-Mart is the largest music retailer selling "an estimated one out of every five major-label albums" in the US. Wal-Mart willingly loses money selling CDs for less than $10 in order to draw transaction into the store, but they are tired of taking a loss on CDs. The mega-retailer is telling the major record labels to lower the price of CDs or risk losing retail space to DVDs and video games. (Scroll to the bottom of the article for a basket case* of where exactly the money goes on a $15.99 album sale.) "[A Wal-Mart spokesman said:] 'The record multinational needs to refine their business models, because the consumer is the ultimate arbitrator. And the consumer feels music isn't properly priced.' 'While Wal-Mart represents nearly twenty percent of major-label music sales, music represents only about two percent of Wal-Mart's total sales. If they got out of selling music, it would mean nothing to them. This keeps me awake at night.' [And another:] 'Wal-Mart has no long-term care for an individual artist or dealings plan, unlike the work stores, which were a real business partner. At Wal-Mart, we're a commodity and have to fight for shelf space like Colgate fights for shelf space.'"

Read more of this story at Slashdot.


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