Multi-priced German CD sales beats expectations

15th September 2004, Comments 0 comments

16 September 2004 , MUNICH - A radical scheme to cut the price of music CDs has been a success in its first two weeks, offering the recording industry a way to compete with "free" pirated music files, according to Bertelsmann Music Group (BMG). Since the rise and fall of Napster, music lovers worldwide have appealed to the Big Four labels to slash CD prices and reduce the gap in price between bootleg files from the Internet and shop-bought CDs. When BMG two weeks ago launched its three-tier price experime

16 September 2004  

MUNICH - A radical scheme to cut the price of music CDs has been a success in its first two weeks, offering the recording industry a way to compete with "free" pirated music files, according to Bertelsmann Music Group (BMG).

Since the rise and fall of Napster, music lovers worldwide have appealed to the Big Four labels to slash CD prices and reduce the gap in price between bootleg files from the Internet and shop-bought CDs.

When BMG two weeks ago launched its three-tier price experiment in Germany, one of its main markets, sceptics predicted almost all buyers would reach for the no-frills version and BMG would not make a profit.

But BMG said nearly 30 percent had opted for the de luxe version of the test album, costing EUR 17. It features extra tracks and a 72-page book of lyrics. German-owned BMG did not split down sales of the standard and the no-frills versions.

For EUR 10, the economy-version buyer just gets the bare-bones CD without any jewel case.

BMG chose a German group, 2Raumwohnung, to launch the pilot scheme with a new album, "Es wird morgen". So far 81,000 have been sold, making it Germany's number two by sales in the first week, said BMG in Munich.

That was more than the entire sales of the band's previous album. BMG admitted it could not be sure whether the band's popularity or the pricing experiment had been more influential, but said it would bring out more recordings in Germany with three-tier pricing.

"The success underlines that we are on the right track with this idea," said Wolfgang Funk, chief executive of BMG's GUN Records.

DPA

Subject: German news

 

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