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Universal said it hopes to revive CD sales after a three-year decline the recording industry blames largely on illegal file-sharing over the Internet The company said it would cut the wholesale price of most top-line CDs to $9 09 from $12 Some independent record store operators said they were not sure how far they would discount Universal CDs or how the new pricing policy would benefit them "There's going to be a lot of deflation "The labels had an interest in protecting (music stores) because they had large receivables from them and it was their standard distribution channel," Leigh said Large retailers such as Borders, BestBuy, Wal-Mart Stores Inc The end of the co-op discounts will mostly hurt large chain CD music retailers like Virgin Entertainment Group and the parent company of Tower Records, said Phil Leigh, an analyst at Inside Digital Media in Tampa, Fla 99, but it's possible Universal CDs will be reduced to below $10 It's no longer worth it to protect your incumbents and Amazon 99 and $13 Universal's new pricing strategy will take effect next month Universal said Thursday it would stop the common industry practice of giving discounts to retailers who spend their own money to advertise or prominently display its CDs "Now the Internet comes along and over time it begins to erode the foundation of the incumbent distribution channel A day after Universal announced a cut on the wholesale price of most of its CDs and an end to advertising discounts, retailers large and small began assessing how the new pricing plan would affect them "We intend on passing the reduction to the consumer," he said He predicted the other four major recording companies will follow Universal's lead 98 from $18 Calls Thursday to Virgin and Tower Records' parent were not immediately returned com generally reserved judgment Thursday on the change, although several noted it could be an effective consumer lure " Foster said he is particularly worried about losing the so-called co-op money that helps pay for advertising and in-store promotions such CD listening stations " Several of them declined to discuss how Universal's initiative would affect their profit margins; music represents only a fraction of sales for such merchants 98, it hopes retailers will charge below $10 "Unfortunately, we're at the stage where there are way more questions than there are answers 02 While it changed its suggested retail price to $12 Analysts have reported in recent weeks that Internet music downloads from pay services will gradually overtake the physical CD in coming years, and Leigh said Universal clearly recognizes the old music-marketplace rules won't apply much longer fewer gross margin dollars per CD, and we hope because of that we'll attract a lot more people to the store," said Mike Spinozzi, Borders' senior vice president and chief marketing officer Universal Discounts CDs to Mixed Reaction Sep 4, 9:46 PM EST Universal Music Group's strategy of lowering its CD prices is good news for music fans, but some traditional music retailers on Thursday worried the move may damage their business Spinozzi said CDs at Borders sell for between $11 It's a fundamental thing that has to happen in the industry," said Rand Foster, owner of Fingerprints, a record store in Long Beach, Calif "I like the idea of CDs coming down in price asp reallyuseful An agreement has been signed with creator Andrew Lloyd Webber's Really Useful Group International Touring Productions for the debut of "Cats" in China on May 20, the report said Friday The curtain closed on the Broadway production of "Cats" in 2000 after a run of 7,485 performances The report did not say how long the musical would run or where it would be staged â€â€?â€â€?â€â€? On the Net: Really Useful Group Web site: http://www com/index2 Report: 'Cats' to Debut in China in May Mar 24, 8:39 AM EST "Cats," the longest-running show in Broadway history, will debut in China this spring, the official Xinhua News Agency said |
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