Wow, wonder what happened, looks like a journalist somehow managed to sneake in @ musictech.net Finally (!!) some relevant actual news from a music magazine, something other than replicating industry sale-points 24/7...


Germany’s Federal Cartel Office has fined three music brands and two dealers a total of €21m for price-fixing. They are Yamaha, Roland, Fender, Thomann and Music Store.

The companies were accused of “systematically” restricting price competition, colluding to set minimum prices on goods in 13 instances between April 2014 and December 2018, said the Cartel Office. This is in accordance with the EU’s competition rules which protects consumers against practices such as price fixing.

A statement explained that when the retailers undercut minimum sales prices, staff at Yamaha, Roland and Fender would “on several occasions contact Thomann and Music Store and ask these retailers to adjust their sales prices, which they also did in many cases.”

On several occasions, the manufacturers also threatened and imposed penalties on retailers – such as a suspension of supply or a worsening of terms and conditions.

Additionally, Thomann and Music Store were found to have agreed on price hikes for individual products in several cases. Yamaha and Roland were also said to have used price tracking software to monitor end consumer prices.

“For years manufacturers and retailers of musical instruments have systematically endeavored to restrict price competition for the end consumer,” said Andreas Mundt, President of the Cartel Office.

“With the fines it has imposed the Bundeskartellamt [German Cartel Office] is sending a clear signal not just to the companies concerned but also to the entire musical instrument sector that violations of the prohibition of resale price maintenance and price-fixing agreements will not be tolerated.


https://www.musictech.net/news/indu...ic-store-fined-total-of-e21m-for-price-fixing

 

Bundeskartellamt imposes fines on manufacturers and dealers of musical instruments

Notification from: 05.08.2021

The Federal Cartel Office has fined three manufacturers and two dealers of musical instruments as well as responsible employees totaling around 21 million euros. The manufacturers and dealers are accused of vertical price fixing, the dealers among themselves also horizontal price fixing in several cases.

The manufacturers (or their sales companies) are Yamaha Music Europe GmbH, Rellingen, Roland Germany GmbH, Rüsselsheim and Fender Musical Instruments GmbH, Düsseldorf. The dealers are Thomann GmbH, Burgebrach and MUSIC STORE professional GmbH, Cologne. The procedure was initiated after information from the market with a search in April 2018.

Andreas Mundt, President of the Federal Cartel Office: “Manufacturers and dealers of musical instruments have systematically worked for years to limit price competition with end consumers. The manufacturers have at least urged the leading specialist retailers Thomann and MUSIC Store not to fall below fixed minimum sales prices, which they did in many cases. In addition, the dealers have made agreements with each other in individual cases about price increases for individual products. With the fines imposed, the Federal Cartel Office sends a clear signal not only to the companies concerned, but also to the entire musical instrument industry that violations of the prohibition on fixed prices and price fixing will not be tolerated. "

There was an agreement between manufacturers and dealers to implement the manufacturers' minimum price requirements. If the minimum sales price was not reached, the responsible employees from Yamaha, Roland and Fender contacted Thomann and Music Store several times and asked these dealers to adjust their sales prices, which in many cases also happened. Yamaha and Roland sometimes use price tracking software to monitor retail prices. In isolated cases, sanctions such as a delivery stop or reduction in conditions were threatened or imposed. For some of the products, however, there was no or only sporadic enforcement or monitoring of the specified minimum prices. Often the retailers did not adhere to the specifications by not implementing them or by circumventing them, e.g. by bundling several products at one overall price. Nevertheless, through complaints to Yamaha, Roland and Fender, Thomann and Music Store demanded compliance with minimum prices by other specialist musical instrument dealers. In part, this was done in response to complaints about their own prices being too low.
In the course of the proceedings for vertical price fixing, there were indications of horizontal price agreements between the musical instrument dealers Thomann and Music Store. Between December 21, 2014 and April 27, 2018, they made agreements on price increases for individual musical instruments or additional products in thirteen cases.

When setting the fines, it was taken into account that the companies Yamaha, Roland, Fender, Thomann and Music Store cooperated extensively in clarifying the agreements with the Federal Cartel Office (Music Store only in the procedure for vertical price fixing) and the procedure by amicable termination of the procedure (so-called . Settlement) could be concluded. The notices of fines are legally binding. A case report with the content of Section 53 (5) GWB is published on the Bundeskartellamt's website under the following link. www.bundeskartellamt.de/SharedDocs/Entscheidung/DE/Fallberichte/Kartellverbot/2021/B11-31-19_B11-33-19.html;jsessionid=F87AD334FC302207BA02D63A3F8C6E45.1_cid362?nn=3591568

Source: www.bundeskartellamt.de/SharedDocs/Meldung/DE/Pressemitteilungen/2021/05_08_2021_Musikinstrumente.html

 

Good news. But is a 4.2 M fine for each (if the fine is equal for each enterprise) more than what they earned with such practice?
If not, it's just a symbolic move, which will probably have no other effect on future policies than perfecting how to hide better such practices.

 

No, it is not a symbolic policy, but current jurisprudence, in Germany there is the Federal Cartel Office "an authority that constantly checks whether cartels are formed and then judges according to the applicable law. In jurisprudence, antitrust law is a branch of competition law that contains legal provisions to prevent commercial cartels.

Some examples:

- The EU Commission imposed a fine of 899 million euros on Microsoft
- Sugar cartel: In February 2014, the German companies Südzucker, Nordzucker and Pfeifer & Langen were fined EUR 280 million by the Federal Cartel Office for anti-competitive agreements.
- The EU Commission accuses LG, Philips, Panasonic, Samsung, Toshiba and Technicolor of negotiating prices for picture tubes and dividing the market among themselves for over ten years. Technicolor paid the fine; the other six sued the ECJ in June 2013 against their penalties, which together amount to almost 1.5 billion euros

 

They should have been fined 21 million each. At least.

I guess it was a way to make sure they would pay the fine (4 million is a joke for them) without thinking about appealing the decision, which would of course be dragging the whole thing for years.

Basically, they didn't want to bother, it was just some kind of PR stunt to show that they are doing something.

 

Oh and also: only from 2014 to 2018, really?

And magically, all this suddenly stopped after 2018?

 

It totally symbolic if the fines do not only recoup the money stolen from the buyers of their products (if it is even that in this case) and if there is no punitive damages awarded. It's actually all bullshit because those that bought the gear at inflated prices are not being reimbursed for their additional out of pocket expense, and in addition that money which should go that way is now pocketed by the State to do with it what it pleases. It's just a racket.

 

Last edited by a moderator: Aug 7, 2021

Edit: Since the mods deleted my posts, this one lost the context therefore it goes..

 

Last edited: Aug 7, 2021

This already happened several times (Roland, Korg, Yamaha getting fined millions in EU), I guess they don't care.

Hm, this is not the only such case.
From last year:
https://www.gov.uk/government/news/...o-pay-millions-after-breaking-competition-law
https://www.theguardian.com/business/2006/jan/30/news.technology

I can only imagine how cheap would musical instruments be, if there was actual competition between the brands.
Btw, is Korg still owned by Yamaha?

 

Federal Cartel Office - August 5, 2021 - By Katharina Kutsche
Instrument manufacturers and dealers have to pay a fine

The musical cartel: Instrument makers forced sellers to keep minimum prices for years - until the Federal Cartel Office intervened.

The Federal Cartel Office imposed fines amounting to around 21 million euros in proceedings relating to unauthorized price fixing. The Bonn authority announced on Thursday. The proceedings were directed against three manufacturers of musical instruments - Yamaha, Roland and Fender - as well as the two music dealers Thomann from Burgebrach in Upper Franconia and the Music Store from Cologne.
The accusation: The three manufacturers set minimum prices for their products, for example for keyboards, pianos, synthesizers and guitars. If the Music Store or Thomann fell below the prices, the manufacturers got in touch and asked the sellers to adjust the sales prices. In many cases this has also happened, according to the competition authority. Yamaha and Roland even use so-called price tracking software to monitor the price information.

Search in April 2018
The European arms of the two Japanese companies have been operating in this way since 2005 and 2006, and Fender from Scottsdale in the US state of Arizona since 2011. If the dealers did not adhere to the guidelines, the instrument makers threatened them with delivery stops or reduced terms. The Bundeskartellamt therefore accuses them of vertical price maintenance. In addition, the authority investigated against Thomann and Music Store because of horizontal price agreements: They are said to have agreed price increases for individual musical instruments and complementary products.

The procedure was initiated after indications from the market, the competition authority searched the companies involved in April 2018. For years, manufacturers and dealers have worked systematically to limit price competition with end consumers, says Andreas Mundt, President of the Federal Cartel Office. "With the fines imposed, the Bundeskartellamt is sending a clear signal not only to the companies concerned, but also to the entire musical instrument industry that violations of the prohibition on fixed prices and price fixing will not be tolerated."
After all, the five companies concerned have partly cooperated extensively with the antitrust authorities, according to the office. The respective individual proceedings could be ended amicably in the past months, the last around two weeks ago. This means that all fines are now legally binding. A spokesman for Yamaha in Germany emphasized that the events were four years ago and the company had already booked the 4.1 million euros fine in the past financial year.

Source: www.sueddeutsche.de/wirtschaft/yamaha-roland-thomann-fender-bundeskartellamt-1.5374096

 

Gibson (founded in 1902) used to manufacture in the USA: Guitars, electric guitars etc ... how come this company produces abroad in low-wage countries? A company starts with it - produces abroad, the manufacturer undercuts the prices ... so now the rally begins. Made in Taiwan. Made in china. Made in Vietnam. It's called "competition"!

Anyone who has an idea can set up a company and participate in the market. if he sells too little he goes bankrupt and is eliminated from the competition. Big companies buy small companies and so on ... Question. Which company is holding out? Native Instrument has fired many of its employees, and Behringer has its own factory in China. The monthly wage in Africa is around 50 dollars, in China around 500 dollars,in America about 2500 dollars and in Europe about 5000 dollars (is estimated - intended as a comparison).

Your musical instruments are only so cheap - because others earn less in low-wage countries, you can also say they are exploited. Some have the know-how and others have cheap labor.

 

Last edited: Aug 7, 2021

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Last edited: Aug 7, 2021

A factory worker in Italy earns about 1200 dollars a month. Where did you get the 5000 dollars info from?

 

Well, I guess he was just setting a hypothetical/visual example..

Maybe in Netherlands, Switzerland, Germany, Norway, Finland, Denmark.. etc,
you can easily make 3-5k per month..

But in Spain you're lucky if you can make more than 1K,
Italy is a little above that, while Portugal, Greece, Romania, Bulgaria you name it, go well under..
IOW Europe is a very unbalanced scenario/example.

In America I guess the Minimum wage would be similar to Spain, Italy or France,
but there's a massive variation on the spectrum, where ppl can make 50-300K per year without a hiccup..
(however they don't have universal healthcare, you contract/pay your own and that's a factor too..)


However close/far the China example was,
it's true that they have increased their living standards a lot in the last decades,
and that has an effect on how/where things are manufactured..

And that may be why in the guitars field a lot of stuff comes from Indonesia,
or China before that, or South Korea before that, etc..

 

Last edited: Aug 8, 2021

You're right about Europe as a whole being a very uneven situation. People are also taxed up the wazoo in those countries you mentioned - not only high income taxes, but also VAT on pretty much every single thing you buy. Like expensive gas/petrol for your already expensive car.

Living expenses (food, accommodation, cars/transportation) are also high, and differ wildly between, say, the Scandinavian countries and parts of Italy, Romania, Bulgaria, Spain etc.

In those countries, a 3-5K salary is basically the bare minimum you'd want for a relatively "normal" life. After taxes, you end up nowhere near that.

 

Regarding the subject, I have noticed a change in prices at Thomann at some point (especially for Yamaha, Roland). And they seem to vary quite often, and it's no longer the "super cheap" option it used to be.

 

The question is, are the fines high enough to represent a real damage to these enterprises? Do they represent more than what they earned by doing fraud on trust policy?

A lot of sanctions given by Europe to mobile telephony companies where just a drop of money compared to what they earned by breaking the law, so as a result, they changed the way, but they are still breaking the law.

 

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You don't want to flatten companies, they should just stop acting in an anti-competitive manner. You are simulating, you're right. Olymoon, democracy, in other words, you apply the laws that you have. The class of managers themselves is partly criminal and they suck the companies out. This form of government is called oligarchy.

You don't want to ruin a company. Every employee makes money and pays their own taxes, pension and health insurance. Every unemployed person costs tax money which is missing elsewhere. In Germany every second euro is for social affairs.

With the big players in the financial sector (banks - banking crisis 2008) profits are privatized and debts shared, too big to fail - to big to jail ", if they gamble in the financial casino, the taxpayers pay for it in the end. Then there are the tax tricks and the tax havens, the world is totally over-indebted and there are no longer any real values behind the debt.

Yes, Olymoon You see Justice does not exist. Most of it is fraud, now and then a company goes bankrupt and the state wins - most of the time the companies do what they want because they have a lot of money to buy tax tricks and enough money to employ star lawyers.

 

@5teezo ... what do you disagree with if a company colludes with others annd still profits after paying a judgment less than what they made? I believe that this is just the cost of doing business for them and not a very big deal. They knew they were breaking the rules and also that in the end would come out ok.