catallaxy files

catallaxy in technical exile

Warner Music to face anti-trust investigation. ..maybe?

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After spending a lot of time (and money) taking legal action against P2P software providers, ISPs, and individual P2P users, the music industry now looks like being on the receiving end of some legal action in New York. The Australian is reporting that Warner Music Group has been issued a subpoena in relation to an anti-trust investigation.

The exact details of the investigation are a bit unclear:

“Music industry sources said the current probe appeared to centre on whether the “big four” music studios – Warner, Sony BMG Music Entertainment, EMI and Universal Music – colluded to set wholesale pricing for song downloads.

The investigation also could be related to the studios’ upcoming licensing renegotiations with Apple, maker of the iPod digital music player, for its iTunes music store, the sources said. “

Personally, I’m hoping that it’s the former, rather than the latter. Simply giving Apple more bargaining power versus the music labels is going to be good for Apple’s margins, but may not end up offering a lot of benefit to end users of legal music download services, especially those using competing services.

On the other hand, legal action that leads to lower wholesale price of music for the whole market, is more likely to flow through to lower prices for consumers as the different music download services compete away at least some of the margin gain from lower wholesale prices.

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Written by Admin

January 3, 2006 at 4:47 pm

Posted in Uncategorized

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