Debate on CD prices divides rock managers: Manager of U2 points to long-term decline in what consumers pay for a 'record'

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The Independent Online
A SPLIT has emerged between some of the managers of four of the world's most successful rock bands over the price of compact discs.

In letters to Gerald Kaufman, chairman of the national heritage select committee investigating CD prices, Paul McGuinness of U2 and Tony Smith of Genesis have criticised as unrepresentative and wrong Elliott Rashman of Simply Red and Ed Bicknell of Dire Straits.

And John Deacon, director general of the British Phonographic Industry, has written to Tony Newton, Leader of the House of Commons, describing the proceedings of Mr Kaufman's committee as 'a shambles'.

The committee is expected to publish its findings, widely believed to come down against present pricing, later this week. It is also believed that the issue will be referred to the Mono polies and Mergers Commission.

Mr Kaufman has repeatedly queried why prices of CDs in the US are up to 50 per cent higher in the UK than the US. Tony Smith, referring to Mr Rashman and Mr Bicknell, both of whom gave evidence to the committee arguing that CD prices were artificially high, said: 'The committee chose to interview the two managers whose artists have not been particularly successful in the US recently and consequently their understanding of the retail market in the US may be very limited.'

Paul McGuinness, manager of U2, also defends the present price of CDs in a letter to the committee. He says: 'In real terms the price of a 'record' has been going steadily down for 25 years. A rise in the price of CDs helps to arrest this trend.' This was emphasised by members of the independent record companies and retail shops at an emergency meeting at the Royal Society in London yesterday. They argued that an enforced cut in the price of CDs would mean that many independent record companies and shops would go out of business.

One member held up his copy of Elvis Presley's Loving You LP priced at pounds 2 10s in 1966 compared to an average CD price of pounds 12 today, a rise of more than four-fold. In comparison he held up a paperback copy of George Orwell's Animal Farm which was then 2s 6d, compared with pounds 4.80 today, a rise of far more than 30-fold.

Members of the independent recording industry covering folk, jazz, world music, rock and classical are incensed at Mr Kaufman and his committee, which they think is biased.

Mr Deacon, in his letter to Mr Newton criticising the select committee, says: 'Mr Kaufman has a duty to come to the issue with an open mind and give us a fair hearing. This he has clearly not done.'

John Craig, of First Night Records, which specialises in film scores and West End shows, said: 'The record business is one of the few British industries where we dominate the world and in our own country we are being pulled apart by a committee which is totally out of control because we are a sexy business which puts Kaufman and his crew in the political vote- catching limelight.'