ARTS / Cries & whispers

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The Independent Culture
A COUPLE of weeks ago, I got a call from Radio 1. The Emma Freud Show wanted to know what had happened to the Campaign for Cheaper CDs. A more sensitive columnist might have taken umbrage at that past tense, but the question had a point. For nine months now we have been waiting for the Monopolies and Mergers Commission to deliver its verdict on Britain's record industry. Are the big five record companies (Warner/ East West, Sony/Columbia, EMI/Virgin, BMG/ RCA/Arista, and Polygram/Island), who together account for 72.6 per cent of the market, an effective cartel? And if so, will they be forced to cut the price of compact discs?

The MMC report should have been out last month, but it was delivered late, and is now with the Department of Trade and Industry, who, in another 10 or 12 weeks, will finally issue the findings of this long and winding investigation. The record companies are not as nervous as they might be: after the drubbing they received last year from Gerald Kaufman's National Heritage Select Committee, they are banking on indulgence this time. The DTI has issued no 'advisories' - the official hints that alert news editors to big stories - which usually means the MMC is going to recommend nothing. In which case, the moguls will no doubt raise their fists in the air and claim they were innocent all along.

This will be misleading. There is more to high CD prices than whether those responsible for them constitute a monopoly. We have never said that they do. What we have said is that if they did, the situation would be much the same as it actually is: a handful of big companies, all charging more or less the same, and all doing their best to make the punter dance to a single tune. With competition as slack as it is, there is no need for dirty tricks.

The absence of technical monopoly does not mean CDs are fairly priced. But that is what the moguls will try to tell us. In this sense the MMC inquiry has been unhelpful to the cause of cheaper CDs. So, in a way, was the tone of the Commons inquiry. Kaufman, while knowledgeable about music and masterly as an interrogator, gave the impression of having made up his mind in advance, against the record companies. Both inquiries, one inappropriate, the other a touch vindictive, have allowed the record companies to shriek injustice and 'kangaroo court'.

This is a pity, because Kaufman's verdict was right. The record companies have come out with every kind of argument to justify their policy, and we still don't know of a single good reason why identical CDs should cost the same in pounds as they do in US dollars, nor why CDs should cost about pounds 4 more than cassettes, when they are actually cheaper to make.

Two years ago this week our Campaign for Cheaper CDs was at its height: encouraged by letters from readers, we published a six-page guide to cheaper CDs and where to buy them. Shops recommended by readers were sent IoS stickers to display in their windows; back copies of the guide quickly sold out. Britain's two best- selling CD bands, Dire Straits and Simply Red, supported the campaign. So did the Labour Party, and that led to the Commons inquiry,

with representatives of the whole industry - band managers, record-company executives,

retail chiefs - being hauled over the coals.

That was a year ago. So how does it look now? The record companies remain impervious; the nearest they have come to a concession is not to have raised wholesale prices again. But it's an empty gesture: even at levels set two years ago, they are still too high. If he pays pounds 8, a price- cutting independent retailer will be hard pressed to sell a disc for less than pounds 10.99.

In the shops, the picture is mixed. The chainstores now compete on chart prices: at HMV, chart CDs are pounds 11.99 or pounds 12.99, at W H Smith they are mostly pounds 12.99, while Our Price (owned by Smith's, which also now owns the Virgin Megastores) usually has a few at pounds 9.99. But move on to back-catalogue - and you don't have to go back very far - and you'll find discs such as Annie Lennox's Diva, k d lang's Ingenue and David Bowie's Black Tie White Noise all at pounds 14.49 or pounds 14.99.

Meanwhile the recession in music sales is well and truly over. Last year sales of CD albums grew by 30 per cent, to 92m. More and more music now appears only on CD - this is as true of new classical recordings as old rock and pop - and CDs account for six of every 10 albums sold. LPs have almost faded away.

Record-company profits, which dipped in 1992, are up again. The record companies can plainly afford to cut prices. Punters can vote with their feet, shops can squeeze their margins, but if CD prices are ever to come down to earth, the people who've been inflating them for too long will have to see sense. And I'm afraid there is still not the slightest sign of that happening.

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