MusicDish e-Journal - October 19, 2018
MusicDish Advertising Network
Search MusicDish e-Journal (Advanced)
Subscribe To MusicDish e-Journal
About | Contact | Advertise | RSS | Submit Article | Submit News | Artist Development | Premium PR Distribution
Mi2N | MusicDish*China | MusicDish Network | MusicDishTV | Urban Music News Network

Universal and Warner slammed for "misusing market power" and "exclusive dealing"
By Jon Newton,
(more articles from this author)
Comment | Email | Print | RSS

Music Industry News - as it happens
Source: MusicDish - March 7, 2002

Universal Music Australia Pty Ltd, Warner Music Australia Pty Ltd and senior company execs have been fined more than $1 million by Australia's Federal Court for threatening to refuse to supply CDs to Australian retailers who stocked parallel-imported CDs and, later, refusing to supply retailers who stocked such imports.

The two recording industry giants had claimed competition from cheap imported CDs would affect their profits and had tried to stop alternative, imported supplies, says the Australian Competition and Consumer Commission (ACCC).

But Justice Graham Hill said neither Warner nor Universal could establish it had a separate aim of preventing "free riding" and rejected, "any attempt on the part of Universal to suggest that the action taken by it was taken to prevent piracy".

In his findings, Justice Hill said, "The dire predictions of reduced promotion through to reduced production and ultimate market failure have simply not happened. If anything, the evidence shows a continued increase in titles, promotion and production and at the same time at lower prices."

Both companies are now permanently restrained from, "refusing or threatening to refuse supply of recorded music CDs to Australian retailers for the reason, or if one of the reasons is, that the retailer has stocked, or proposed to stock, non-pirated copies of CDs in the music catalogue of either Warner or Universal from an alternate source", says the ACCC.

"This is an important precedent, as well as an important win for Australian consumers as it means that retailers will be able to freely access cheaper, legal, imported CDs without fear that they will lose supply of other stock", ACCC chairman, Professor Allan Fels, said.

In July 1998, amendments to the Australian Copyright Act legalised the parallel importation of CDs that didn't infringe the copyright laws of the country in which they were made. Shortly after, the ACCC began its investigation of the conduct of PolyGram Pty Ltd (since taken over by Universal), and Warner after allegations that PolyGram and Warner had closed the accounts of retailers, and had threatened to withdraw trading benefits of those who stocked parallel imports.

Last December, Justice Hill found both Universal and Warner breached the Act by misusing their market power and by exclusive dealing. Senior executives of those companies were held to be knowingly concerned in the contravention of their employers. He held that Universal and Warner had a substantial degree of market power in the wholesale recorded music market with market shares of approximately 15 to 17% and 17 to 18% respectively.

"Each major record company (including Warner and Universal) has exclusive rights to a range of music, which forms its catalogue. In each catalogue a company is likely to have top selling titles which, at any one time, are on the chart," says the ACCC. "For most consumers a specific title cannot be substituted. It is commercially imperative that a music retailer can access major companies catalogues. A retailer denied supply may not be able to obtain music from the companies' catalogues either locally or overseas at an economic price, on time, or at all."

Justice Hill said: "It must be accepted that the conduct engaged in here was serious. It was a deliberate attempt to subvert the consequences of legislation designed to permit parallel imports of non-infringing copies of compact discs".

* penalties - Universal - $450,000, Warner, $450,000

* Paul Dickson (formerly PolyGram Group Managing Director of Music Operations) - $50,000

* Craig Handley (formerly PolyGram General Manager of Sales) - $45,000

* Gary Smerdon (Director of Warner, formerly Finance and Business Affairs Director) - $45,000

* Greg Maksimovic (Warner NSW State Manager) - $45,000

* injunctions permanently preventing Warner and Universal from refusing, or threatening to refuse supply to retailers for the reason that they source or propose to source non-infringing copies of music within their catalogue from an alternate source;

* costs - Universal, Warner to pay 75% of the ACCC's costs, with Paul Dickson, Gary Smerdon, Greg Maksimovic each to pay 75%, and Craig Handley 70%.

Related News from Mi2N:
» Threats To C.D. Supplies Cost Record Companies $1M

Home » News Beat » Universal and Warner slammed for "misusing market power" and "exclusive dealing"
Email |Print |Comment |RSS

back | top

MusicDish Advertising Network

News Beat

» indieOn Connects Music to the Blockchain

» 13 Music Label Sold to MTN

» Darcus Beese Named President Of Island Records

» ASCAP Revenues Top $1.144 Billion In 2017

» BMG Appoints New Creative Directors In Nashville

News Beat Directory

» [2018-09-16] Live Nation Electronic Asia Inks Deal With Budweiser For Creamfields Festivals; Together, Creamfields And Budweiser Will Focus On Building Entirely New Content For Dedicated Electronic Music Fans Throughout Asia

» [2018-08-23] Andy Ma Appointed Warner Music China CEO; Andy Ma Has Also Been Appointed EVP, Commercial And Business Development For Greater China

» [2018-08-23] IndieOn Connects Music To The Blockchain; IndieOn Is Confident Of Creating A "music Miner" Who Listens More And Grow Their Token Value

» [2018-06-23] The 2018 MIDEM Silk Road International Music Alliance Signing; International Music Industries Signing Of A Mutual Resource Sharing Agreement With Shanghai Conservatory Of Music & The China Records Group

» [2018-06-06] Screen Music Connect To Explore The Music Of Film, Television And Interactive Media; Created By James Hannigan, Award-winning Composer And Game Music Connect Co-founder, Screen Music Connect Builds On The Success Of The Sold-out Game Music Conferences

» [2018-06-05] Fred Casimir To Develop BMG's Global Recordings Business; As Well As Building BMG's European Infrastructure, Casimir Was Instrumental In Developing BMG's Recordings Business

» [2018-06-03] 13 Music Label Sold To MTN; DSN Music Spins Off Record Label To Albuquerque Music Entrepreneur's New Group

» [2018-06-02] CISAC 2018 Annual Report; A Comprehensive Overview Of The Confederation's Work To Serve 4 Million Creators And 239 Authors Societies Across The World

» [2018-06-02] MusicDish Announces A Love Electric 2018 China Tour; The Tour Will Crisscross Through China With 12 Shows In 8 Cities, Including Guangzhou, Dongguan, Zhuhai, Shenzhen, Kunming, Jiaxin, Wuhan And Beijing

» [2018-06-02] Darcus Beese Named President Of Island Records; Renowned U.K. Music Executive To Join Universal Music Group's U.S. Label Leadership

» [2018-05-17] Avant-Garde Label Maybe Noise Launches In Beijing; The Official Launch Will Be On May 26 At Magnet Theater With A Performance Supporting Its First Vinyl Release: Png Z

» [2018-05-04] Award-Winning Lithuanian Rock Band Colours Of Bubbles "She Is The Darkness" 2018 China Tour; The Tour Will Kickoff In Shanghai Where The Band Will Represent Lithuania During The Country's Signing To The Silk Road Music Alliance
MusicDish Advertising Network

follow MusicDish on
Follow MusicDish on Twitter

Mi2N Music PR

Tony Carlucci & Dynamic Destony Releases New LP "A New Day"

Laura Angelini Makes Birthday World Event

Killer Tracks Delivers The Music For A NASA Moon Video

John Keenan Taking It To The Next Level

Royale - Playground (Single)

Make A Wish With Catherine Duc's 'Stargazing' Remix Of Ben Hobbs' 'Blind To You'

Asian Pop Queen Celest Releases Debut English Single/Video "I Got Him"

Websites: Mi2N | MusicDish*China | MusicDish Network | MusicDishTV | Urban Music News Network
Services: Submit Article | Submit News | Submit Video | Artist Development | Premium PR Distribution

Copyright © 1997-2018 MusicDish LLC., all rights reserved.
About MusicDish e-Journal | Contact Us | Advertise | RSS | Internships