The Cost of a CD Should be Exponentially Higher, According to the RIAA

WHAS 11 ^ | 2/2/2007 | Ben Woods

[Dallas59]

The Recording Industry Association of America hasn't been making too many friends these days. I guess I should say that the organization does have many friends inside the music industry, because that's who makes up the the RIAA.

I'm not here to argue whether it's right or wrong to download free music where it's available, or whether it's OK to listen to your friend's "Beach Boys Greatest Hits Album." I'm just here to point out what the RIAA wants you to believe about the cost of music and CDs.

If you visit the Key Stats/Facts page on the RIAA website, you'll notice a justification for pricing CDs. The biggest argument appears to be the fact that the Consumer Price Index rose nearly 60 percent between 1983 and 1996, even though the price of a CD actually went down. While this might be a true statement, this is virtually worthless in determining how much a CD should cost.

Let's examine this statement, directly from the website:If CD prices had risen at the same rate as consumer prices over this period, the average retail price of a CD in 1996 would have been $33.86 instead of $12.75.

I know that the CPI has risen, but these numbers don't seem to translate properly. So I visited the Bureau of Labor Statistics Data site u>, which contains a CPI Inflation Calculator. Unfortunately, I needed the initial value (of a CD in 1983), instead of the theoretical value in 1996. Since I didn't have that, I just guessed until I came up with $33.86 in 1996. I finally found that value: $21.50.

This means that the RIAA is claiming that the average cost of a CD in 1983 was $21.50. How many CDs have you purchased for more than $20?

True, the CD was new technology at the time, and it's quite possible that the price, in some places, was more than $20. Where the RIAA deviates from basic technology knowledge, however, is that more often than not, the cost of producing something like a CD almost always goes down over time.

What better example of electronics getting cheaper than taking a look at the history of the calculator. From the website listed above, Texas Instruments came out with a calculator in 1972 (TI-2500) that cost $119.95 (actually, the suggested retail price was $149.99). If we take a look at the CPI inflation calculator, using the calculator cost and a 13-year span, from 1972 to 1985 (the same time length the RIAA used), we see that the calculator should have cost about $308.77 in 1985.

Maybe this isn't fair, considering the time periods are different. So I'll try $119.95 in 1983, and the value in 1996 is $188.96.

How much do you think a calculator that could do only basic math functions (add, subtract, divide, multiply) was worth in 1996? By 1981, Texas Instruments had already developed a model that included more functionality for $19.99. Granted, the technology involving calculators and CDs are vastly different. My point is that when you are in the technology world, most of your products, with the same level of functionality, do not get more expensive.

The CPI is useful for looking at the prices of raw material, grocery items, etc. Sorry RIAA, but buying a CD isn't like buying a bushel of Korn.

[Dallas59]

Excuses....

[snarks_when_bored]

Am I the only person who would have no trouble continuing to live well if I never bought another music CD?

[RightWhale]

Only CD I buy anymore is the tax program. If I want music, the old piano sits over there ready to go at any time even if the power grid is down again.

[ARE SOLE]

[flashbunny]

The RIAA and the member labels generally screw the artists out of as much money as they possibly can. However none of this excuses stealing music any more than the UAW making crappy cars excuses auto theft.

[xcamel]

Just proves the IQ of most RIAA members is "exponentially lower" than most normal folks.

[snarks_when_bored]

No doubt about it.

[Nathan Zachary]

I am so sick and tired of hearing those in the music industry whine.

If they don't want anyone to listen to their songs 'for free' stop putting them on the airwaves. Or at least maybe those "artists" should PAY for the free airtime (advertizing) they get, all things being equal. Maybe then they will shut up.

[xcamel]

"We sue Dead People -- and 9 year olds"

[Reaganesque]

So, you're trying to restrict cheap, but illegal downloading of music on the Internet but yet at the same time want to drive the price of CD's up by more than 100%? Good thinking!

Even Wierd Al thinks the RIAA is a joke: Don't Download This Song.

[Mr_Moonlight]

The Cost of a CD Should be Exponentially Higher, According to the RIAA

Sure, price yourselves right out of the market. Thats the ticket to success, BABY !!!

[sam_paine]

So how is limewire diff from the old napster/bittorrent stealing s/w?

[Revel]

LP's went for 5 to 6 dollars in 1983. I have several major hit albums from that time that still have the price on them. LP's cost more to make than CD's. The RIAA is very good at lying.

[Dallas59]

When "Snoopy Dog Dog Bling Bling Kill A Cop and White People" and his ilk started to flood the airwaves....I stopped buying..

[snarks_when_bored]

I am so sick and tired of hearing those in the music industry whine.

If they don't want anyone to listen to their songs 'for free' stop putting them on the airwaves. Or at least maybe those "artists" should PAY for the free airtime (advertizing) they get, all things being equal. Maybe then they will shut up.

Your comment put me in mind of something that I read yesterday:

About 10-15 years ago, music companies told a bunch of NZ TV stations that they had to pay fees in order to screen music videos. The TV stations disagreed, saying that they were providing free advertising for the music companies, and if they didn't like that then they'd simply stop playing music videos. So they stopped playing all music videos.

After a few weeks, cracks stated to appear as the music companies realised just how badly they needed the TV channels. One of the music companies bought an entire prime-time advertising block (at phenomenal cost, this wasn't a single 30-second slot but every slot in an entire prime-time ad break) just to play one single new music video.

Shortly afterwards, music videos reappeared on TV. The details of the settlement were never made public, but I imagine it consisted of a bunch of music company execs on their knees begging the TV stations to start playing music videos again and let's please never bring this matter up again.

(from Peter Gutmann's essay, "A Cost Analysis of Windows Vista Content Protection")

[SengirV]

Nope. The RIAA can dry up and wither away. The Music industry is a joke these days. I'll admit that I have purchased CDs in the past year, but just to fill in some gaps in my music collection. But I can't recall the last NEW release I've purchased.

Lets hope Steve Jobs and Apple conitue standing up to the music industry. He told them to pound sand when they wanted a cut of every iPod sold. Yet Bill Gates/Microsoft gave that away. Also, Microsoft crippled the Zune' wifi system to bend over backwards to the RIAA.

[mysterio]

The RIAA should face antitrust action.

[Nathan Zachary]

Perhaps the music industry should be forced to pay a user fee to every citizen in the country whose ears they use "for free" and without permission when their product is bombarded over airwaves and television media.
I shouldn't be forced to hear it, so I want 25% of gross receipts from both the artists and all others involved in the music industry paid into a general fund which is then divided up and sent to every legal American citizen at the end of each year.

No more freebies, these are MY ears, if they want to use them, they should pay
/s

[snarks_when_bored]

You might be interested in reading the Peter Gutmann essay I just linked to in post #15...

[beef]

This is record company BS. I was the first one on my block to get a CD player in 1983. CD's were about $15-$25, if you could find them Vinyl was about $6.00. But if we compare the cost of the mature technology of 1983 to the comparable mature technology of 2007, in inflation adjusted dollars they get a little more for the CDs.