Wednesday, March 26, 2008
Walmart Cuts CD Prices
With the release of the new Rolling Stone Magazine comes a new blog post to comment on it. I loved the main article on Chris Rock, an excellent comedian of our time, and on one of my favorite musicians, Adam Duritz from the Counting Crows. Well-selected pieces.
However, I would like to comment on their article "Walmart Demands CD Price Cuts" because I am absolutely stunned by the information. To tell you the truth, I am not that surprised that Walmart pulled a fast one like this, knowing their scheming behavior to rip off who they purchase their goods from, sell them dirt cheap, and then pay their workers almost nothing. We all know this.
My surprise is this: Walmart is demanding that major record labels sell them their products (CDs) for a much lower price now so that Walmart can sell CDs for $5-10. Normally, CDs at Walmart go for about $13.99, give or take, so this drop in sales prices will cost major record labels tens of millions of dollars.
Since Walmart is the number one music retalier in the US, how can major record labels say no to this demand? I think it's disgusting. The music industry is going downhill as it is. Many labels have shut down because they can't profit from music pirating and this new digital world. CD sales have decreased fifteen percent so far in 2008, so how can these labels disagree? Some sale is better than no sale, right?
iTunes is a close second seller. Walmart contains 16% of sold music while iTunes generates 14% of sold music. Seeing that digital music tracks are on the rise, as compared with hard copies of CDs, this poses a giant threat to major labels. What to do?
I know a lot of people hate Walmart for their dirty business strategies. Other people love them because they can buy products for little money. Perhaps some stand in the middle, like me, who understand and dislike what Walmart is doing but simply we cannot do anything about it. I mean, can we? And I, being fresh out of college, enjoy Walmart's low prices when I want to save a buck or two. We just can't win here.
Check out this image I found on Google image search. What do you think of this creation? Is it crazy/accurate?
So, what do you think of Walmart?
What do you think of the new proposal to slash CD prices, thus slashing profits for major labels in this struggling music industry?