Richard Menta, founder of MP3 Newswire, has some personal observations he would like to share about a correlation between high CD music prices and of all things, diamonds. Drawing an analogy between DeBeers and the record labels, he makes a good point about how big business can manipulate the market to put the sqeeze on consumers. He feels P2P has become a threat to the music labels ability to do just that.
The truth is diamonds are not rare at all, they are quite plentiful. Prices are high because a cartel controlled by DeBeers, has managed to dominate the world market, hoarding these frankly common gems to keep prices artificially, and extraordinarily, inflated. DeBeers has managed to create a false scarcity of a product, limiting distribution with an iron fist and multiplying profits several thousand fold. Their days are limited though. A recent article in Wired titled "The New Diamond Age" alerts us that two companies have reached a breakthrough in man-made diamonds. Their product is chemically and structurally the same as a DeBeers product because it is the same. They are real diamonds, produced in a lab yes, but true diamonds nonetheless. The destination for these artificial diamonds is not the fingers of fiancées around the world, but the chip industry that diamond microchips will revolutionize. The price they plan to sell a pure, flawless diamond? Only 5 dollars per carat. Music is not scarce anymore. We can thank the P2P services for this. They make music widely available and affordable, giving the masses open access to contemporary culture as well as songs that have moved past generations. Music the industry wants you to now pay twenty bucks a CD for. Music they want priced at a point that intentionally limits you to only a few CDs a year for maximum profits. CD are still riding on the scarcity principal. Today the record companies self-righteously scream that their products are worth twenty dollars a CD and they say even that is a bargain. It isn't. So tell me should the governments of the world come to DeBeers rescue because that company can no longer sustain the scam? Likewise, why should the US Congress bail out the record conglomerates, because it has become harder for them to cheat the consumer? |
He goes on to say that Congress is told by the RIAA that file trading is theft and it is killing the industry. Richard begs to differ, citing A recent Nielsen/NetRatings poll that shows file trading actually helps sales. Richard feels that P2P services finally bring balance to a system unfairly tilted to favor the supplier. He says CDs are still selling, despite the fact that 60 million citizens file trade. "The rules have changed. The record industry needs to adjust. If the existing record industry cannot adjust, someone new will come in to take their place- like makers of 5 dollar diamonds". Says Menta.
An interesting analogy. But making synthetic diamonds is duplicating the magic of mother nature, creating a new product from scratch, not copying and sharing someones art. Of course, it is also not fair to consumers, when they are charged inflated prices simply because the lables can control the market place. What do you think?
Source: mp3newswire.net
