High Street Music Stores vs CD-Wow

[Virgo's Haircut]

I heard on the radio, that stores such as HMV, Virgin etc want to close down such websites as CD-Wow because they are only charging £6.99 for some chart CD's, and the big boys are getting all upset because they are losing money.

Now, they are taking it to the government to get them closed down as they aren't based in the UK.

Surely, this is called competition?

 

[El Presidente]

The issue is in relation to VAT. CD-Wow is officially registered in Hong Kong, and as most CD's cost less than £18, no VAT is charged on them when they 'enter' the UK. This allows CD-Wow to undercut the high street rip off merchants to the tune of 17.5%.

HMV et al will no doubt will also be wanting to close down Tesco, Sainsbury and Asda for selling CD's for less than a tenner!

 

[southstandandy]

CD Wow have saved me a shit load over the last three years - long may they reign !

 

[Wilka]

play.com are good as well. Much quicker than cd wow for delivery but sometimes a little more expensive.

 

[El Presidente]

Cheers Wilka, have just ordered the first series of 'The Shield' (4DVD's) for a mere £17.99!!!

 

[Carrot Cruncher]

Both Play.com and CD-Wow offer great value for money, but (and certainly not in the case of CD-Wow) they don't have much of a back catalogue, so if you're trying to find some obscure album from the mid 90's you'll be dissappointed.

But for current albums they have saved people, as someone pointed out, a shit-load of cash.

It would be different if the copies were dodgy or pirated, but they're not.

Someone from the BPI should ask themselves, as a consumer, what they'd rather do - pay £12.99 upwards or sit in the comfort of their own home and pay £7ish. If the former's the answer, then they're lying ba**ards....

 

[Simster]

The issue is in relation to VAT. CD-Wow is officially registered in Hong Kong, and as most CD's cost less than £18, no VAT is charged on them when they 'enter' the UK. This allows CD-Wow to undercut the high street rip off merchants to the tune of 17.5%.

HMV et al will no doubt will also be wanting to close down Tesco, Sainsbury and Asda for selling CD's for less than a tenner!

No sympathy for the big boys from me.

If that is the case, then why not lobby the government to remove VAT on CDs and DVDs, or charge some sort of duty on imported CDs?

They're shitting themselves over the competition, and good thing too. It wasn't long ago when we were paying £14.99 per CD, consumer watchdogs were telling the public we were being ripped off - and at the time these arseholes at Virgin and HMV were telling us that they just couldn't sell them any cheaper.

Yeah right. That's why some DVDs are at 6.99 in the high street then. Nothing to do with competition from the internet at all.

 

[Inkerman]

8 years ago I went on a tour of a CD "factory" in Switzerland as part of a Supplier Visit related to my job.
I was told then that CDs (including the case and inserts) cost less than 50p to produce. With improvements in technologhy this will be less now - so why are they more than £3?

 

[DTES]

why are they more than £3?

Because people will pay it. Simple.

Even worse are Printer Ink Cartridges, which only cost about £1 to manufacture, yet sell for £25 - again, because people will pay it, needing them.

 

[Bad Ash]

I'm a cd-wow man myself. I use the hong kong site http://www5.cd-wow.com.hk/ which has prices in HDK and works out over £1 cheaper than the Uk version.

The only problem I find with buying online is that if the cd cases have those small, clear, plastic teeth to hold the cds in most of them are broken by the time they arrive at your house. Its annoying because it there are plenty of cases out there these days that work perfectly (admittedly some make it almost impossible to get your cd out) and don't break easily.</rant>

 

[Bad Ash]

With improvements in technologhy this will be less now - so why are they more than £3?

Because the artist, producers, record label, promoters, retailers and whoever else want to make £££

 

[Carrot Cruncher]

It's a weird one as it's the government that's losing out with the VAT money, everyone except the retailers such as Virgin and HMV are still getting their cut.

I thought it was the BPI that was taking action, not the retailers - or are they action on their behalf

 

[Soton Seagull]

I've use CD-Wow for the past 18 months or so. Good service, often arriving faster than a CD from a more expensive company in the uk.

HMV & Co are just part of Rip off Britain. Just saved myself £10 a night on a hotel in LA by paying in US Dollars via and American site, compared to the UK one I looked at. THe whole world thinks we are here to be ripped off!

 

[Deano's Right Foot]

8 years ago I went on a tour of a CD "factory" in Switzerland as part of a Supplier Visit related to my job.
I was told then that CDs (including the case and inserts) cost less than 50p to produce. With improvements in technologhy this will be less now - so why are they more than £3?

A bit simplistic but on a £13 CD:

It can cost anything from £5k to £1m to actually record a CD - the process can take months or even years in expensive studios.
70p goes to the publisher/songwriter
Artist royalties average £1
Manufacturing can be 50p but can be as high as £1.20 with fancy stuff (O card, 48 page booklet, special inks etc.)
VAT is 17.5%
Marketing can be up to £1 a unit (or more per unit on an unsuccessful record)
Record companies have overheads - staff, buildings etc.
Distributors take a cut (around £1)
Dealer (Virgin / HMV etc) margins are around 30% of the shop price (say £3.50)
Successful artists demand (and get) huge advances against their royalties.
And finally record companies actually try to make a profit despite only one record in 20 making money for anyone (the rest losing money).

It all adds up.

 

[El Presidente]

CD Wow is a disgrace. How can the record companies be expected to keep their artists and executives up to their elbows in hookers and cocaine at £7.99 an album?

 

[Wilko]

CD Wow is a disgrace. How can the record companies be expected to keep their artists and executives up to their elbows in hookers and cocaine at £7.99 an album?

No sympathy for the big boys from me - If they dropped their prices to match CDwow they would see a huge increase in custom. Its always nicer to have the CD in your grubbies than have to wait through the post. Sort it out HMV will ya, muppets !

 

[marvin]

Two words for those who think Record companies should be allowed to continue too rip us off.

Simon Cowell.

 

[desprateseagull]

if cdwow can sell for 8.99 or whatever, so can the others

i'm sure if they really wanted our business, they would reduce prices (and so attracting less vat?) or setup some distribution operation overseas... or just buy out cdwow!

...they dont like up em, mr manwaring!

 

[BRIGHT ON Q]

Tesco and Sainsburys are cheaper than Vigin and Hmv for cds.They know what to do if they are that worried don't they.
The thing is though its like T.Vs and Hi Fi ,you can get it a lot cheaper online but Dixons and co still seem to get a lot of trade,I can't understand why anyone would buy a T.V from Dixons anymore.

 

[Wozza]

The problem with spending abroad is that the jobs soon follow...