New York Attorney General subpoenas major labels

By Derek Sooman on December 27, 2005, 7:10 PM
Iíve found confirmation of recent reports that New York attorney general Eliot Spitzer has started an investigation into music download pricing, and is handing out subpoenas to the major labels, including Warner Music, Sony BMG, EMI and Universal Music Group.

This is hardly unfamiliar territory for the music mob. The FTC once accused the major labels of costing consumers close to $480m via CD price-fixing. The pigopolists denied the charges but did agree to hand over $67m in cash and $76m worth of CDs to the suing states.

Now there's a question of just how the labels set download prices. Analysts often peg the per song sale price at about 70 cents. Companies such as Apple and Real then resell the songs for about 99 cents.

The record companies have been pushing hard to increase the per song download price for hotter acts. Why not get $1.39 per song for the latest American Idol spawn?

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