|
|
GERA
New International
Entertainment Retail Alliance Formed Top Priority Is Digital
Distribution Strategy
SAN ANTONIO — March 1, 2000.
Retailers and retailer associations and organizations from eight
countries representing over 65% of the world music retail market today
announced the formation of the Global Entertainment Retail Alliance (GERA)
to develop a coherent approach to global electronic commerce in
entertainment products. The announcement was made at the conclusion of
the NARM Convention in San Antonio, Texas.
GERA’s founding members include representatives
from Australia, Canada, Germany, Mexico, the Netherlands, New Zealand,
the United Kingdom, and the United States.
GERA’s priorities include issues relating to the
rapid growth in new technology being rolled out on a global scale, which
are fueling a race to deliver sound recordings digitally via the
Internet and wireless telecommunications
systems. The retail community has always been quick to adopt new formats
for music delivery that benefit consumers, artists and copyright owners.
However, technological developments have begun to outstrip the ability
of market participants to grasp the full consequences of implementing
new formats for delivery without due consideration to consumers’
interests or the long-term health of the creative community.
Because retailers are the front line linking the
artist to the consumer, the retail group expressed greatest concern for
maintaining the currently high level of retail customer satisfaction.
Retailers fear that unauthorized third party invasions of privacy in
consumers’ music selection choices, unauthorized collection and use of
personally identifiable consumer data, confusion in conflicting formats,
and efforts to limit consumer enjoyment of the music after the sale, may
all inhibit the growth of online distribution.
"When a download doesn’t work, the customer
will come to the retailer for answers," noted Al Herfst, from the
Retail Music Association of Canada. He added, "Retailers don’t
cause these problems, explaining that the problems are likely to be
caused by other factors such as software incompatibility and automated
circumvention of the retailers’ privacy policies. In addition,
restrictive technologies designed to limit what the consumers can do
with the copies they purchase will also cause a consumer backlash,"
Herfst concluded.
The Alliance is particularly concerned about the practices
being challenged by NARM in its lawsuit against Sony impact music
retailing around the world. Participants noted that there are few laws
to protect consumers from being denied competitive music buying choices,
or to protect artists from having to give up creative control over their
own Internet sites as a condition of doing business. While agreeing that
litigation is never the preferred solution, all participants stated that
they absolutely supported NARM’s legal action to resolve these issues,
and intend to analyze how the claims made in NARM’s lawsuit might find
a parallel under their own domestic laws.
The founding members of GERA emphasized the
importance of dialog as a means of avoiding litigation. "It is
evident that the major record companies’ corporate plans for the
Internet and electronic commerce are being made by a separate division
outside of the normal channels of communication," observed Martin
de Wilde, of the Dutch group, who added that individual territories are
afforded no opportunity at all for input into global plans that affect
them. Therefore, the Alliance is seeking to engage executives at the
highest corporate levels to develop compatible Internet strategies.
Members of the group also resolved to work with their
own government officials to address not only the impact of the dizzying
pace of consolidation on the supply side, but also the issues of
consumer privacy, fairness in trade practices, and greater uniformity in
copyright law treatment of sales through digital distribution. Two
cornerstones in the search for common international ground are the
principle that technology should not be used to (1) fuse onto copyrights
the ability of the copyright owner to prevent distribution to anonymous
consumers, or (2) arbitrarily restrict lawful consumer choices
concerning the use of lawfully acquired music.
GERA intends to serve as a forum for tackling other
issues that have arisen as a consequence of the new global economy. At
the top of the list are the reduction of piracy and the development of
uniform government regulatory practices. Bob Lewis, of BARD in the
United Kingdom, noted, for example, that when retailers are competing
with other retailers in foreign countries, it becomes imperative that
their own nation’s laws not place them at a competitive disadvantage.
The consensus is that greater global uniformity in the treatment of
electronic commerce will benefit all participants.
NARM serves the music and other prerecorded
entertainment software industry as the pre-eminent forum for insight and
dialogue for its more than 1,200 member retailers, wholesalers,
distributors, entertainment software suppliers, and suppliers of related
products and services.
International Music Retailers Explore
Closer Collaboration On Internet Commerce Issues
Executives from four music retailing trade organizations met
during Popkomm in Cologne, Germany, in mid-August to discuss issues of
common interest, with particular emphasis on the Internet.
During discussions, it became clear that retailers in
the United States, Great Britain, the Netherlands, and Germany are very
excited about the potential of the Internet and digital downloads, but
are convinced that physical product will continue to be a major vehicle
for transporting music in the future.
Representatives from NARM, BARD (UK), GDM (Germany),
and NVGD (the Netherlands) all reported that their that members are
seeking a greater role in the development of Internet plans by the
international music companies. They expressed the view that greater
collaboration between the industry and retailers would be the best way
to harness the opportunities offered by E-commerce.
All four groups noted that music retailers are not
afraid of competition on the Internet and are, in fact, strengthening
their Internet activities through Web sites and the various new kiosk
technologies. As a result, the strategies of brick-and-mortar retailers
are merging with the newer digital distribution channels.
The executives all shared the view that their members
would adapt their retailing strategies to the changing needs of the
consumer and that the industry would be well served by the expert advice
and knowledge of the traditional retailer.
In addition to Internet topics, the group also
discussed piracy, source tagging, street dates, and imports/exports.
Popkomm is the three-day music industry conference
sponsored by the German government each August. In addition to a trade
show, the conference includes seminars on a variety of topics.
Pam Horovitz, NARM President, participated in one of
the panel discussions on the topic of music retailing and the Internet
along with representatives from CDuctive, Global Fulfillment, Universal
Music, and Jupiter Communications. Horovitz was enthusiastic about the
trip, commenting that "the exchange of information with our
counterparts in Europe was extremely valuable" and that plans for a
follow-up meeting at NARM next March are underway.
 National
Association of Recording Merchandisers
9 Eves Drive, Suite 120
Marlton, NJ 08053
PH:
856.596.2221 . F:856.596.3268
© 2002 NARM
|
|
