Headline News

Music Companies Pay $143mil For Price-fixing

NEW YORK (Reuters) - The world's five largest music companies and the three largest music retailers will pay $143.1 million to settle a CD price fixing case launched by New York and Florida two years ago, New York State Attorney General Eliot Spitzer said Monday.

In August 2000, most U.S. states joined in a lawsuit alleging that an industry practice called ``minimum advertised pricing'' (MAP) artificially inflated the price of CDs between 1995 and 2000, violating federal and state anti-trust laws. Under MAP, the labels subsidized advertising for retailers that agreed not to sell CDs below a certain price.

The five record labels -- Vivendi Universal's Universal Music Group, Sony Corp.'s Sony Music, Bertelsmann AG's BMG Music Group, Warner Music Group, a division of AOL Time Warner Inc. and EMI Group Plc -- and the three retailers, Musicland Stores Corp. , Trans World Entertainment Corp. and Tower Records, agreed to stop using MAP policies as part of the settlement.

The companies, which did not admit any wrongdoing, will pay $67.4 million in cash to compensate consumers who overpaid for CDs between 1995 and 2000. The companies also agreed to distribute $75.7 million worth of CDs to public entities and nonprofit organizations throughout the country.

While it's good to see the big labels pay up, this is merely a drop in the bucket and the consumer will never see a penny of it anyway.

Read the full article at SiliconValley.com.

Source: Moreover News