Re: Digital Watermarks (long, getting off-topic)

At 10:26 AM 7/24/96 -0800, jim bell wrote:

>Isn't it odd that when music is sold, CD's are MORE expensive than cassette 
>tapes, even though you _know_ that the manufacturing cost of CD's is less?

CDs sell for more because buyers decided that they wanted a wider range of
titles with shallower sales (hence higher unit costs) rather than a narrower
range of titles with lower sales prices.  The number of CD titles available
is far greater (in general distribution) than the number of vinyl titles
that were available during vinyl's peak year.  This greater availability of
short run pressings raises average unit sales costs justifying the higher
prices.  Had the market decided (when physical production costs fell) that
it was satisfied with a Top-40 CD stock, average CD prices would have fallen
to vinyl levels.

>Another oddity:  The price for a blank, standard-quality videocassette is 
>about the same as that of a blank, standard-quality audio cassette tape, 
>despite the fact that the volume of tape included in the former is probably 
>about a factor of 10 higher.

Materials cost is a minor part of total cost.

In both cases, the cost of production is a small part of the cost of goods
sold.  Almost all of that cost is the cost of marketing (as with all
mass-market products in a modern capitalist economy.

DCF

"The only adequate description of the Universe is the Universe itself.  The
only fair price of an item is the market price.  Neither the Universe nor
the Market can be adequately duplicated in the head of a Congresscritter."

Duncan Frissell wrote:
| At 10:26 AM 7/24/96 -0800, jim bell wrote:
| 
| >Isn't it odd that when music is sold, CD's are MORE expensive than cassette 
| >tapes, even though you _know_ that the manufacturing cost of CD's is less?
| 
| CDs sell for more because buyers decided that they wanted a wider range of
| titles with shallower sales (hence higher unit costs) rather than a narrower
| range of titles with lower sales prices.  The number of CD titles available
| is far greater (in general distribution) than the number of vinyl titles
| that were available during vinyl's peak year.  This greater availability of
| short run pressings raises average unit sales costs justifying the higher
| prices.  Had the market decided (when physical production costs fell) that
| it was satisfied with a Top-40 CD stock, average CD prices would have fallen
| to vinyl levels.

	Thus, my desire to listen to the Drummers of Burundi justifies
a cost of $16.99 for the latest REM album?  If I want the wide range
of African music thats now available (and I do), then I should be
willing to pay a premium to get it.  No reason for Alanis Morisette
fans to subsidise those of us with musical taste.

	Except for collusion on the part of the major record
companies, who have a price called the 'MAP,' or minimum access price,
under which they won't provide advertising for the record & store.
Those MAPs sit between 10.81 & 10.88 for the biggest six record
companies.  Theres a lawsuit in process now to decide if there is
collusion occuring.

Adam



-- 
"It is seldom that liberty of any kind is lost all at once."
					               -Hume