EC Targets Music Club Players for Price Fixing

Share this content:
The European Commission's upcoming probe of alleged CD price fixing in Europe among the music business' big players -- EMI, Warner, BMG, Sony and Universal -- is for real, and it could hurt music club business in the European Union.

Mario Monti, the commissioner in charge of EU competition, has a reputation as a tenacious investigator. Also, Alastair Tempest, director general of the Federation of European Direct Marketing and the industry's chief lobbyist in Brussels, said the EC's competition department attracts the best people.

He noted that Monti already had forced the combined AOL-TimeWarner entity to abandon hopes of acquiring EMI. Nor has Thomas Middelhoff, Bertelsmann's CEO, acquired the company that would have made BMG an even bigger player. Instead, Middelhoff went after Napster.

All of the music industry's major firms have record and CD clubs in Europe, Tempest noted, and there is little doubt that if price fixing charges stick, the club business would be hurt. Tempest believes that Monti has a strong case.

"It could affect the whole market for CDs in ways we may not even imagine as yet," Tempest said.

If, as a result of the EC investigation, CD prices drop in European retail outlets, clubs would have to go lower still. The majors could survive such price-cutting, but smaller club labels may not.

That, in turn, could strengthen the control of large music companies, something Monti does not want to happen. That could slow resolution of the case. The European Commission is not noted for speedy action.


Next Article in Direct Mail

Sign up to our newsletters

Company of the Week

Brightcove is the world's leading video platform. The most innovative and respected brands confidently rely on Brightcove to solve their most demanding communication challenges because of the unmatched performance and flexibility of our platform, our global scale and reliability, and our award-winning service. With thousands of customers and an industry-leading suite of cloud video products, Brightcove enables customers to drive compelling business results.

Find out more here »

Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here

Relive the 2017 Marketing Hall of Femme

Click the image above