British CD Retailer Hit With Wow-Inducing $81 Million Fine

May 30th, 2007 // 7 Comments

It’s a bad day for lovers of CD WOW!, the super-cheap U.K.-music website that one of your Idolators frequented for years (until .rar blogs came along, of course). In its heyday, most import-only discs on the site would go from anywhere between $12-$15, including shipping; the prices were so low because the albums were actually shipped from Hong Kong, a violation of European copyright law. CD WOW promised to stop the practice in 2004, but apparently they kept at it, earning them an $81 million fine yesterday:

At issue are long-standing copyright rules that allow music companies — and other intellectual property holders — to charge different prices in different markets for the same product. It has long been illegal to import CDs or buy downloads from outside the European Economic Area with a view to selling them on a cut-price basis…

Music is available much more cheaply in Asia than in the UK because it is believed that it is not possible to charge much in countries like India and China, where piracy is rampant.

Record companies charge wholesale prices estimated to be as low as £1 or £2, compared with £6 in the UK, making it theoretically possible to charge far lower prices if the items are imported.

We won’t even begin to try to understand the U.K. copyright system, as it seems to be about as hard to follow as cricket and season six of Are You Being Served? But we’ll be mighty un-chipper if if CD WOW! goes down: When it was in the early ’00s, and you really, really needed to hearcheap new music from NME-championed Brit-bores, it was the only place to go.

CD Wow pays high price for selling cheap music in UK [Times Online]

idolator

  1. Al Shipley

    “Music is available much more cheaply in Asia than in the UK because it is believed that it is not possible to charge much in countries like India and China, where piracy is rampant.”

    So, uh, how rampant does piracy have to get here before U.S. record companies start slashing prices?

  2. KinetiQ

    @GovernmentNames: Aah, but in the US we have (at least the appearance of) enforcement of copyright laws. And, of course, to peek and see how well police and lawyers can discourage “bad” behavior, jut take a peek at the war on drugs.

    So a question of how rampant law-breaking has to be before they consider changing it is unfortunately irrelevant.

    Great, now I’m depressed.

  3. Paul D

    Does anyone else think that having the ability to buy the same product cheaper elsewhere is the very essence of capitalism?

    Why do these copyright holders hate capitalism?

  4. Ned Raggett

    They hate it when they can’t make more money off of it.

  5. StevenPatrickMorrissey

    i’m a proud cdwow supporter and this really blows…

    god forbid we’re able to seek out BUUYING music at an affordable cost.

  6. revmatty

    @PaulD:

    Well, what the modern ‘capitalists’ really love is not really capitalism but rather capitalism as it existed from the late 1800′s to the mid 1900′s. They loathe free markets, labor mobility, and free flow of information.

  7. KevinOLoughlin

    The trade group that brought the action in the first place should probably worry more about the piracy problem surrounding the music industry rather than chasing CD WOW! through the courts for the last 5 years.
    As Paul D referred to above.. it’s surely not the BPI’s job to keep prices artificially high in the UK compared to other markets.
    And don’t worry – it’s business as usual for cd wow.

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