There are many things folks are reluctant to accept -- wooden nickels, a good ass-whuppin,' Don Ho albums -- but few people ever pass up the opportunity to score some free cash.
Yet that's just what many music fans are doing these days, since anyone who bought a CD between January 1, 1995, and December 22, 2000, is entitled to a portion of a multimillion-dollar settlement that record companies and retailers agreed to last fall. Dubbed the MAP (Minimum Advertised Pricing) Settlement, the money has been set aside to compensate CD buyers in the wake of price-fixing by five major labels and three retailers. The practice began in the early '90s, when Musicland/Sam Goody, Tower Records, and Trans World Entertainment conspired to set prices -- a reaction to large operations like Best Buy and Wal-Mart, which were selling CDs below cost to get people into their stores. While admitting no wrongdoing, the labels and retailers have agreed, as part of a deal, to pay $67.4 million in cash to consumers and donate $75.7 million worth of CDs to charities.
So how do you get your dough? It's easy. All you need to do is log on to http://musiccdsettlement.com and fill out a brief questionnaire. No receipts or proof of purchase are necessary -- you just have to confirm that you did in fact purchase a CD, cassette, or album during the specified time span. To be eligible to share in the proceeds, you have to file by 3 p.m. on March 3.
The big question is how much you're gonna get. That will depend on how many people file claims. It won't exceed $20 and may amount to as little as $5. If more than 8.8 million people apply, the sum will fall below $5, and all the money will be given to charity. So far, only about a million folks have filed claims, so the chances are good that anyone who applies will get a check.
It couldn't be happening at a better time. With RIAA and the major labels making a huge stink over the past year's 20 percent decline in sales and laying the blame on downloading, this puts things in perspective. Clearly, labels are at least partially responsible for the recent slump, as CD prices have become so exorbitant that, with tax, a CD purchased at most chain music stores now costs more than $20. Labels are quick to condemn music fans for file-sharing, but they never seem to ask why folks are doing it; in many ways, labels themselves, with their inflated prices, have driven people to the Internet.
Of course, labels are quick to argue that while the cost of making CDs has dropped significantly, the expense of marketing them has shot up. But who's to blame for that? The way the industry has configured itself in the last few years, such outlays are all but inevitable.
When the majors began merging with one another in '97, centering the industry on a mere five companies, they dropped thousands of mid-level bands that consistently sold between 100,000 and 250,000 records -- once-respectable numbers that labels could make decent money on -- in favor of an emphasis on churning out blockbuster records. With the teen pop explosion hitting shortly thereafter, there was a temporary boom in album sales, and labels became increasingly infatuated with the huge amounts of cash generated by a small cadre of artists: the Backstreet Boys, Britney Spears, *NSYNC, etc.
The problem is, the cost of putting together a blockbuster record is just as steep as the cost of producing a blockbuster film. The budget for Britney's wardrobe for a single video rivals what most indie bands have to record an entire album. By focusing on big-budget, high-maintenance artists to the exclusion of more moderate-selling acts, labels put themselves in a position where the whole industry became dependent on the astronomical sales of a few artists.
Consequently, the amount of money spent on marketing records skyrocketed, as labels spent piles to try to ensure that the handful of artists capable of generating serious revenue had major hits. When sales by those few artists began to fall off -- as they did for all the aforementioned in 2002 -- the industry was dealt a substantial blow, and it came at a time when expenses had never been higher. It's no wonder that labels need to charge so much per disc. But it's hard to feel sorry for an industry that brought all this on itself. Who cares, then, if their returns have suffered? So have music fans. As a result, it's time to show us the money -- and a little respect.
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