User User name Password  
   
Sunday 8.11.2009 / 08:27 AM
Search AfterDawn.com:        In English   Suomeksi   På svenska
afterdawn.com > news > wal-mart battles for $10 cds
Show topics
News
News

Wal-Mart battles for $10 CDs

17 October 2006 5:04 by Ben "Lethal_B" Reid | 55 comments

Wal-Mart battles for $10 CDs Wal-mart, the United States' biggest retailer, wants every CD you buy to cost no more than ten dollars. The company, which moved a quarter of a trillion dollars' worth of goods last year, is used to getting its own way.

The store, which boasts 138 million shoppers per week, sells an estimated one in every five major-label albums. Insiders believe that it has so much power, that what it chooses to stock can basically decide what ends up being successful. "If you don't have a Wal-Mart account, you probably won't have a major pop artist," said one label executive.

Wal-Mart willingly loses money selling CDs for less than $10 to lure consumers into the store, hoping they might also pick up a DVD player or a boombox whilst inside.

But now, Wal-Mart is fed-up of losing money on its cheap CDs. It wants to keep selling them at the current price ($9.72), but it wants the recording industry to lower the prices at which it purchases them ($12) in the first place.

Last year, Wal-Mart asked the industry to supply it with choice albums at favorable prices. According to music-industry sources, Wal-Mart executives hinted that they could reduce Wal-Mart's CD stock in favour of more profitable DVDs and video games. "This wasn't framed as a gentle negotiation," said one label rep. "It's a line in the sand -- you don't do this, then the threat is this." (Wal-Mart strongly denies these claims.) As a result, all of the major labels agreed to supply some popular albums to Wal-Mart's $9.72 program. "We're in such a competitive world, and you can't reach consumers if you're not in Wal-Mart," admitted another label executive.

It is in the best interests of the music industry to keep Wal-Mart happy, because if Wal-Mart cut back on music, industry sales would suffer severely, but hardly affect the retail outlet. While Wal-Mart represents nearly twenty percent of major-label music sales, music represents only about two percent of Wal-Mart's total sales. "If they got out of selling music, it would mean nothing to them," explained another label executive. "This keeps me awake at night."

Gary Severson, Wal-Mart's senior vice president and general merchandise manager in charge of the chain's entertainment section, said "The labels price things based on what they believe they can get -- a pricing philosophy a lot of industries have.

"But we like to price things as cheaply as we possibly can, rather than charge as much as we can get. It's a big difference in philosophy, and we try to help other people see that."


One major-label rep is reported to have said, "I don't think there is a music supplier in America who really enjoys doing business with Wal-Mart."

Source:
Rolling Stone


Permalink to this article

Get AfterDawn's news to your favourite feed reader! Share this story with your friends!
 

 
Related articles:

  • AC/DC album to be Wal-Mart exclusive (11 June 2008)
  • Did Wal-Mart threaten Hollywood over Apple? (25 September 2006)
  • Wal-Mart eyeing digital movie downloads (15 September 2006)
  • Wal-Mart quits online rentals and promotes Netflix (20 May 2005)
  • Wal-Mart cuts DVD rental prices (11 June 2003)
  •  

    « Previous news article
    Florida judge clears 'Bully' release
    Next news article »
    Recording industry goes lawsuit crazy: sues 8000
     Post your comment
    Discuss this article!  There are more user comments available, read them here
    fandr78 (Member) 19 October 2006 19:27 Send private message to this user   
    $10.00 a cd is still too much.Half the cd's that come out these days are less then 40 minutes long and one good song..You can buy a 50 pack of cdr's for less then 10 bucks.Hmmm not too hard to figure this one out.The music industry dug their own hole,now they should laydown.
    hughjars (Inactive) 20 October 2006 4:43 Send private message to this user   
    I agree.

    $10 is much better and starting to get more like it but it is still too high.
    nos_ (Inactive) 21 October 2006 19:04 Send private message to this user   
    i have'nt seen anyone mention that Walmart's cd's are all fucking editted. why buy a cd from them when it's been editted...like rap by eminem...just get ur drunk "butt" on that runway "beeeeeeep" lmao ya right
    ZippyDSM (AfterDawn Addict) 21 October 2006 22:30 Send private message to this user   
    nos_
    And not all Music cds cuss like a motherfcker no a fcking plane :P
    Auslander (AfterDawn Addict) 21 October 2006 23:37 Send private message to this user   
    most modern music is trash, anyway. seems you almost have to go underground to find any artists with talent or a true drive.



    My childhood is gone, because I loved you.

    Ich bin der Ausländer.
    ZippyDSM (AfterDawn Addict) 21 October 2006 23:43 Send private message to this user   
    Auslander
    since the last half of 90's I have started to like J pop alot more...even the engerigh sounds better than the new wave of poor ass music that has degraded all grenes of US music..I am a country fan BTW and look at what country has become...its all rather disgusting...posh and fake....



    FIGHT THE M.A.F.I.A.A.
    "Hollywood the 4kids of comic moives."
    Looking to swap analog sticks on a PS2 pad,need some help or info
    http://forums.afterdawn.com/thread_view.cfm/398201#2403533
    Auslander (AfterDawn Addict) 21 October 2006 23:47 Send private message to this user   
    i find myself clinging to deeper and darker metal, as it seems that's near the only genre left where musicians still do most of their own work and aren't just lip-syncing, cookie cutter song-buying stereotypes.



    My childhood is gone, because I loved you.

    Ich bin der Ausländer.
    rockjckey (Newbie) 22 October 2006 0:17 Send private message to this user   
    I don't care if Wallyworld sells Cd's for 5$, I'm not setting foot in a store that sells 75% Chinese products. Besides nobody goes there anymore anyway. It's too crowded!
    ZippyDSM (AfterDawn Addict) 22 October 2006 0:47 Send private message to this user   
    rockjckey
    STOP....THINK!!!
    Nobody goes there because its to crowded


    ................................................
    LOL


    Anyway you have a point they only have deals on 50% of their stock everything else is ether marked up or normal retail.

    mitch999 (Inactive) 22 October 2006 3:47 Send private message to this user   
    The corporate mogals in the music industry and in Hollywood should realise that $1 in the till is better than $0 in it.
    pamsipod (Junior Member) 22 October 2006 6:10 Send private message to this user   
    Walmart sucks in every way possible, I would much rather pay more for a CD than ever even consider buying it from Wally World. I can't believe we are all willing to let such a sleezy store take over the world just because we save a few pennies. Walmart is killing small down business all over the globe, how is that okay...with anyone?
    armworth (Inactive) 22 October 2006 8:30 Send private message to this user   
    $10 is what a CD should sell for. The price has been steadily going up over the last 20 some years. Everything else in electronics goes down in price over time. DVD players, big screen TVs - the price drops dramatically after a few years. $19.98 for a CD? No wonder sales have dropped! You tell 'em Wal-Mart!!
    Steve83 (Member) 22 October 2006 8:34 Send private message to this user   
    So how long do you think until RIAA attacks WM for "doing more damage to the recording industry than pirates ever could"?
    ZippyDSM (AfterDawn Addict) 22 October 2006 11:50 Send private message to this user   
    Steve83
    they have already tried to attack VLC,they wont go after MS jsut yet since MS has handicapped vister if MS dosent keep vister video and audio free then the RIAA will strike!

    This message has been edited since posting. Last time this message was edited on 22 October 2006 11:54

    brucezx11 (Newbie) 26 October 2006 14:43 Send private message to this user   
    How can anyone blame Wal-Mart. Its the consumer who goes into Wal-Mart and spends money. If everyone who keeps blaming Wal-Mart would actually stop going there to purchase other things besides CD's maybe Wal-Mart wouldnt be so popular. In any case I will still go there to purchase my groceries.
    I dont hear anyone bit*hing about Home Depot, or Lowes putting local hardware stores out of business. We live in such a double standard society.
    pamsipod (Junior Member) 26 October 2006 19:05 Send private message to this user   
    @brucezx11
    I'll jump on that bandwagon...I hate all of the the giants, Walmart, Home Depot, Lowes, Target, Kohls, and all the big chain restaurants. All of them ruin small business everywhere, and quite frankly make visiting and moving to new places boring. Nothing is different from one city to the next...other than climate and landscape...Sorry to get off the subject, but you brought it up.

    As long as we continue to be patrons at these places, their world domination thrives, our choices diminish, and prices stay fixed or go up due to of lack of competition. Okay, I need to stop now, I could go on forever!
    TazmanYo (Newbie) 27 October 2006 10:20 Send private message to this user   
    One more reason to love Walmart. Good Philosophy
    Walmart is Awesome. Everyone I know loves them, too.
    I just wish I had one closer to me.
    Soon they will, and life will be perfect.
    Viva la Walmart.
    ZippyDSM (AfterDawn Addict) 27 October 2006 13:49 Send private message to this user   
    As evil as wlamart is it can adjust prices better becuse its on the front line this is great for persciptions and mabye for music and a few other things but the down side is whore marts everywhere with the added joy of when it leaves areas or small tons it snot going to be pretty when tis the only food/med store in the aera 0_o
    Shado36 (Member) 29 October 2006 18:55 Send private message to this user   
    Some pretty varied comments here! For the most part I like Walmart, I will not comment on there employee rights etc as I have never worked for them. Personally I rarely buy any music at all because I simply do not like most of what is out there! This I think is because I am not a native of this country so what I used to like at home is very hard to get here if at all! I have a varied taste in music but as a general rule I do not like whats out there. I do not want to listen to "music" where I cannot understand whats being said, every other word is an expletive or bands that ride on the coatails of others by covering there music. Its about time that the prices of cd dropped the record co's have had it there own way for far too long.
    As to a remark about Home Depot & Lowes etc not caring who they put out of buisness, I think u are right, they don't give a rats ass. We have both nearby and at least two other stores have closed and the Lowes has not been open six months yet! Having been in both I would add that there service sucks, neither have enough bodies on the floor and certainly many do not know there ass from there elbow! Hardly good for customer service but to bring the thread somewhat back on track its all about the big buck and nothing else!


    ZippyDSM (AfterDawn Addict) 29 October 2006 23:19 Send private message to this user   
    Shado36
    Walmart is not "evil" just One sided

    Good
    can recreate nation wide pricing for drugs and other items.
    Is everywhere.
    Huge employer nation wide.



    Bad
    Sells to much crap from china.
    Hurts small local Stores .
    when it leaves a community and tis the only "store" its nto a pretty sight.
    Dosent have lower prices on non china goods.
    Suxy benefits for employees .



    Walmart is a mixed bag they almost help as much as they hurt,but thats alot like any other corporation.



    FIGHT THE M.A.F.I.A.A.
    Sony has declared war on importers the consumer will be next with CD's,Videos/Games not far behind that....boycott SONY!
    http://www.afterdawn.com/news/archive/8062.cfm
    tnarulz (Junior Member) 30 October 2006 4:32 Send private message to this user   
    Except in the US Wal Mart is the No 1 retailer so whatever Wal Mart does other businesses have to do the same or go out of business.

    Spellcheck is a nice invention.
    Using BitVomit hurts the swarm your in, get a decent client.
    pamsipod (Junior Member) 30 October 2006 6:29 Send private message to this user   
    Only because WE give them the power!

    Pamsipod
    TazmanYo (Newbie) 30 October 2006 6:37 Send private message to this user   
    Face it, we live in a competitive market. Places like Walmart are inevitable. There will be no little man in certain industries anymore. The solution, dont blame walmart, create your own product that walmart does not sell and create your own market. Get with the times. Gas prices are high and one stop shopping is here whether you like it or not. Embrace the future. And if walmart employees dont like their pay, they can always unionize. But you can cry and moan all you want, truth is... Walmart has more consumers everyday and is growing. The only problem with walmart is that there needs to be more of them to accomadate the masses. Quit your whining and get a job.
    ZippyDSM (AfterDawn Addict) 31 October 2006 1:18 Send private message to this user   
    TazmanYo
    So your saying that the corperations should do as they please because the world revolves around them...........
    TazmanYo (Newbie) 2 November 2006 12:05 Send private message to this user   
    Yes
    pamsipod (Junior Member) 2 November 2006 14:42 Send private message to this user   
    @TazmanYo

    Don't have a job, don't need a job, don't want a job. First of all, if it were as simple as creating a unique product with our own market, everyone would be doing it. Secondly, even if you are lucky enough to come up with something, they would want to carry it, and if you didn't bend to their every whim, they would develop a competing product, and put you out of business, if you did sell out to them, then they rule even your personal world....see the problem??? If you don't, then maybe you need glasses.
     Post your comment
     

    Subscribe to our newsfeed

    Get the latest headlines delivered directly to your favourite RSS reader or content aggregation service by using the links below.

    AfterDawn.com: News - RSS feed
    Add to Google
    Add to My Yahoo!
    Add to MyMSN

    Search for headlines

    Search through our news archive.

    Last week's most popular software downloads

    Digital video: AfterDawn.com | AfterDawn Forums
    Music: MP3Lizard.com
    Gaming: Blasteroids.com | Blasteroids Forums | Compare game prices
    Software: Software downloads
    Blogs: User profile pages
    RSS feeds: AfterDawn.com News | Software updates | AfterDawn Forums
    International: AfterDawn in Finnish | AfterDawn in Swedish | download.fi
    Navigate: Search | Site map
    About us: About AfterDawn Ltd | Advertise on our sites | Rules, Restrictions, Legal disclaimer & Privacy policy
    Contact us: Send feedback | Contact our media sales team
     
      © 1999-2009 by AfterDawn Ltd.