By Stephen M.H. Braitman
Controversy erupted when Jack White’s Third Man Records placed five limited-edition White Stripes LPs on eBay and let auction bidding determine their sale prices. Howls from fans and collectors erupted over the label’s action, and Third Man’s Ben Swank delivered a cogent yet inflammatory blog response in The Guardian (U.K.) online newspaper.
The label announced late in November the release of both black and split-color red and white vinyl editions of the album. The colored vinyl versions were limited to 500 copies at $50 each, sold at Third Man’s Nashville Record store, sites in Detroit and the Netherlands, and online. Of course, those copies sold out quickly.
Then, Third Man placed five copies on eBay, with the final bid prices between $460 and $535. The company wasn’t the only ones putting this LP up on eBay; in the week ending Dec. 5 there were 42 copies listed, all selling for three figures.
Third Man, however, was the only one donating its income from the bidding to charity. That didn’t seem to assuage fans who angrily confronted Jack White in what became a heated public discussion. The fans argued that their loyalty was being exploited by having to compete in a global marketplace for the limited editions.
Ben Swank defended the eBay postings in his blog, saying that record labels should be able to do anything to survive in this period of crisis for the music industry. Since the label and artists “put the work into the release, they should profit from it.” Since the records will all end up on eBay anyway, why not give fans a direct line to obtain these records, instead of from “flippers” (some of whom were apparently waiting in vans overnight to buy the records from the Nashville store)?
Swank acknowledges that record collectors “often pay inflated prices” because that’s “part and parcel of the game.” We want something badly enough, we’re willing to pay whatever it takes to obtain it.
This is a complicated issue, at the very heart of collecting, commerce, and Capitalism. The market dictates the price, yes, but there are conditions in that marketplace that are not exactly free or unbiased.
Foremost, Third Man Records has power over the transaction by being the origin of the products. They can make a “limited-edition” 500 copies, or 200 copies or one copy. They can make more copies, they can make less. It is just product.
People may appear to be “free” to bid whatever they want to win one of the LPs, but it is the label’s artificial restriction of access to the product — the “limited edition” — that creates the desire, creates the market. When there are many more consumers for a product than there are products for the consumer, there is price inflation. This is simple Economics 101. Third Man knew it was going to make much more than $50 each for their records on eBay.
The actual motives of Third Man Records in donating their auction income to charity may be admirable, but most interesting is a comment that Ben Swank made toward the end of his blog. “I can’t believe it’s taken 15 years for a label to start selling its own releases on eBay (even in limited numbers).” It may have taken 15 years, but you can bet that we’re going to see more and more record company eBay postings like this. Labels already know how large a profit margin there is in 180-gram vinyl reissues.
They’ll soon be thanking Third Man Records for opening the floodgates to even more delirious bidding frenzies as they realize how easy it is to hook the collector community with fancy “limited editions” and other glittery gewgaws.
Stephen M.H. Braitman is the owner of Music Appraisals, which offers complete music appraisal, archival and disbursement services. Go to www.music appraisals.com for more information. The above article is from his Insider Murmur column in Goldmine’s January issue.
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