Supreme Court Refuses to Red Light Antitrust Case Against Music Labels



+ Add a Comment


Of course they have to set a price floor. What was their logic for this lawsuit? That music should be free because it costs nothing to duplicate the files electronically? And therefore shouldn't have a price floor? Music is an intangible good so there has to be some sort of artificial pricing - ideally, at least enough to cover all overhead expenses in running their business (in this situation: EMI, Sony, etc). Without price-flooring, assuming anyone can just go into the business of distributing music, songs would literally sell for pennies and nickels.



To my understanding, it's not the fact that company's set a price floor per say, but rather that they collaborated with each other to set the SAME floor. That's the source of most antitrust cases, when a group of companies that jointly hold what is effectively a monopoly make deals behind the backs of law makers and the public to artificially elevate their prices.

The US System is based off of Capitalistic concepts, which in theory are supposed to preclude monopolostic actions. The free market is supposed to set the prices, and you can't have a free market if the main suppliers are artificially constraining the supply.

This is why in the US this is actually one of the more serious crimes a company can commit, and it always warrants high level federal attention.

Log in to MaximumPC directly or log in using Facebook

Forgot your username or password?
Click here for help.

Login with Facebook
Log in using Facebook to share comments and articles easily with your Facebook feed.