MPs to look at CD prices

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The Independent Online
THE PRICE of compact discs, already the subject of an inquiry by the Office of Fair Trading, is to be investigated by the Commons Select Committee on National Heritage in the New Year.

The all-party committee, which scrutinises the work of the Department of National Heritage, wants manufacturers, retailers and other interested parties to submit evidence by 12 January. It hopes to report by the end of February. Its chairman, Gerald Kaufman, said: 'The entire select committee agreed we should look at this issue. I've been personally interested in this issue for some time.

At pounds 12- pounds 14, full-priced CDs cost 50 per cent more in Britain than in the United States. The Independent on Sunday has been campaigning for cheaper CDs since January. Mr Kaufman said: 'There seems to be a general feeling that CDs could be less expensive. Even with the cost of post and packaging, it is cheaper to import CDs from the US than it is to buy them here. The select committee is interested to know why.'

The committee's decision was described as very good news by Stephen Locke, director of policy for the Consumers' Association.

'The issue has not gone away,' Mr Locke said. 'There is nothing particularly magical about the US market and it is dealing with the same product. In some ways, the British market is easier because

it is more concentrated.'

Mr Locke said that the Consumers' Association was very interested in a measure developed in Australia. From 1994, following a change in the import laws, Australian retailers will be allowed to buy stock from any country that is a signatory to copyright conventions. 'We hope that the select committee will consider our ideas,' he said.

Jeff Clark-Meads, of the British Phonographic Industry, which has consistently defended CD prices, said: 'The BPI welcomes this move. There has been a lot of misinformation about this issue. We value the opportunity to be able to present the truth.'

He said that the BPI hoped that the select committee's inquiry 'will lay to rest the myth that CDs are too expensive. We will tell them why CDs are more expensive here than in the US and we're very confident of our ground on that'.

High-street stores have been offering discounts on selected discs in the run-up to Christmas. The Virgin megastores have some chart CDs at pounds 9.99 and Woolworths has reduced back-catalogue CDs by Madonna, Simply Red and others to pounds 8.99.

Meanwhile, MiniDisc, the new format developed by Sony, has gone on sale. It is the second new digitally recorded format to appear this autumn following the launch of Philips' Digital Compact Cassette (DCC).

Both formats cost pounds 5- pounds 6 more than analogue cassettes, which they are designed to replace. Despite assurances from record companies that wholesale prices for DCCs and CDs would be the same, DCCs and MiniDiscs are more expensive in most shops. 'In many instances the CD will be cheaper than DCC and MiniDisc,' said Nick Early of Virgin Retail.

Only Woolworths is selling DCCs at prices equivalent to CD. Mr Early said sales of DCC and MiniDisc were 'relatively slow'.

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