Hawkwind MP3's

[M Holmes]

Mahkno nestor writes:

> In a message dated 11/11/2002 19:07:18 GMT Standard Time,
> fofp at HOLYROOD.ED.AC.UK writes:
>
>
> > In the strict sense that's true. However on deeper analysis it's clear
> > that as with cars, part of the sale value of CD's takes account of the
> > resale value. Therefore if the band are on a percentage royalty then a
> > healthy secondhand market does add to their income.
>
> ??????????????????????????????
> Err lost me completely there - could you try explaining this point again
> perhaps from different angle ?

When you buy a car, you pay price X at the garage knowing that
after Y years you'll get roughly price Z for it. So you make a
calculation that you'll pay X-Z Pounds for ownership of the car for Y
years. When Z goes down then folks are willing to pay less X for the car
because they have in their head an idea of how much per year they're
willing to pay for the imputed rent of the car.

The same is true for anything else with a resale value, including CDs.

So if the secondhand price of CDs falls, then at the margin, people are
less willing to pay as high a full price for them.

Proving that with CDs would take quite a lot of work, but it's a pretty
established economic principle and unlike many such things, it matches
up to common sense and experience.

FoFP