Think MAP policies are bad? We're really screwed now.

[OnlineStageGear]

I don't think u guys read that correctly.

By a 5-4 vote, the justices overturned a 1911 Supreme Court ruling that minimum prices set by manufacturers on what dealers can charge customers for their products are unquestionably illegal.

That means that retailers can now sell stuff cheaper that the maufacturers dictate.

[iced_earth]

For what its worth, I have some unique insight into this case. The company that won this lawsuit established their minimum selling prices for one main reason: They wanted the smaller stores that sell the product to be able to train their employees about the product line, what went into making the product, and why its different from other lines of products that look similar. Basically, they wanted a higher level employee selling the product instead of a minimum wage bozo. Selling at discounted prices would result in the huge chain store effect - the people selling the product have no knowledge what so ever about what they are selling and the product becomes a simple commodity.

For all the people that bitch about the bone-heads at Guitar Center, this particular company's policy was setup to have knowledgable people selling the product with their training paid for by the selling price(and that might be one of the reasons you don't find the product line at the larger discount stores). Take this for what its worth, but I don't think you'll find that in any article.

[iced_earth]

I don't think u guys read that correctly.


That means that retailers can now sell stuff cheaper that the maufacturers dictate.

The 1911 ruling made manufacturer set selling prices illegal... now the manufacturer has more control as the 1911 decision was overruled.

[Tashtego]

If only we had a SJC packed with 9 Kiki Ginsburgs we could have the government setting the all prices in no time. Ah, what a paradise we soon would enjoy, shepherded by our moral and intellectual betters from Harvard and Columbia.

[Boxcar Willie 84]

You guys are so right....damn nobody buys Mesa/Boogie, Apple, Mogami, or Monster right???

[UFORocks]

LOL - As if the government can do anything about gas prices (aside from repealing the gas tax that is).

Point taken, but wouldnt this decision technically allow the oil companies to set minumum prices for gas and fuel oil?

[YetAnotherOne]

Point taken, but wouldnt this decision technically allow the oil companies to set minumum prices for gas and fuel oil?

In a paranoid left-wing conspiracy theory? Sure. In the real world? Not a chance.

[UFORocks]

In a paranoid left-wing conspiracy theory? Sure. In the real world? Not a chance.

Im no conspiracy theroist, but I think you give these corporations too much credit. Ever since the Enron case many businesses have been investigated and found to be participating in business practices ranging from questionable to illegal.

[pro-fusion]

As a libertarian, I actually agree with this ruling, even though I don't like the thought of guitar manufacturers setting sale price floors. Here's the deal, though, I think that guitar companies who try and ram this stuff through will have a big problem. Who do you think came out the winner in the tussle between Gibson and GC? GC can sell plenty of stuff besides Gibson. If Gibsons aren't displayed in the shop, how long do they stay in business?

In certain instances (Mesa), the market position is so strong that they can dictate terms, but that type of thing is rare and subject to change. Let the market, not the government, decide.

[Spivonious]

If GC didn't sell Gibsons no one would shop at GC. Jackson? Sure no problem dropping them. ESP? sure. But never Fender or Gibson. That's like 90% of the guitars at the store.

[toddstaples]

If GC didn't sell Gibsons no one would shop at GC. Jackson? Sure no problem dropping them. ESP? sure. But never Fender or Gibson. That's like 90% of the guitars at the store.

GC didnt have gibson for quite a few years, if i remember correctly

[pro-fusion]

GC didnt have gibson for quite a few years, if i remember correctly

Yeah, they had a dispute, though I don't know that it went on that long or to what extent. Gibson has tried to play strong-arm with its retailers, and it doesn't sound like they're doing all that well. Of course, their QC problems could be a factor, too.

[Rupe]

You guys are so right....damn nobody buys Mesa/Boogie, Apple, Mogami, or Monster right???

That's the point I was about to make. I don't think Mesa has suffered from this policy. MSRP's will drop to me more in line with the market as well.

[YetAnotherOne]

Im no conspiracy theroist, but I think you give these corporations too much credit. Ever since the Enron case many businesses have been investigated and found to be participating in business practices ranging from questionable to illegal.

Not at all, I just understand the very limited scope of this decision. All it says is that every conceivable vertical price maintenance strategy under the sun is no longer illegal per se but instead some few may be allowed in certain circumstances. In any case when these situations occur their legality will be examined on a case-by-case basis.

What it does NOT say is that it's open season and all price fixing strategies are now legal. Horizontal price fixing will still typically be illegal and it remains to be seen what norm will emerge in vertical price maintenance strategies.

With respect to oil companies where, precisely, do you think they have the ability to fix prices to any significant degree?

Gas at the pump typically carries around a $0.10/gallon markup over the wholesale price paid by the station and it's a completely fungible product. Most of us don't care if we fill up at BP, Texaco, Exxon, or the independent corner convenience store, whichever is cheaper will do. Suppose Exxon sets a $3.50/gallon price floor at their corporate stations when the retail market price is closer to $3.00/gallon. Are you going to pay $3.50 or drive across the street or down the road and pay $3.00? And if the majors all get together and set a common floor you have horizontal price fixing and an antitrust violation.

Crude prices are set by what amounts to a continuous worldwide free-for-all / auction, the overwhelming majority of the planet's raw crude passes through this marketplace. It's pure supply and demand there, not much opportunity for manipulation other than by major oil exporting nations / cartels who've been attempting to control the market for years and who have met with only sporadic and marginal success. Crude production is, BTW, where the real money is made in this industry but the market is so large and so complex that intentionally impacting it in any meaningful way without leaving enough fingerprints to guarantee detection is pretty much impossible. The forthcoming Iran / Israel nuclear cage match will spike oil prices by a couple hundred bucks/bbl or more and most probably collapse the world economy in the process but after most of you are unemployed the resulting oil glut will guarantee that you'll finally have your cheap gas you want. *That's* the sort of event that can successfully manipulate the world oil market.

I suppose there is some potential for manipulation on the part of domestic refiners since they're basically the bottleneck in the gasoline supply chain. But with an ever-increasing number of foreign refiners clamoring to send finished gasoline to the US there's a fairly low ceiling on their ability to engage in significant manipulation.

Where this decision will have a bigger impact is in the luxury goods sectors, things for which premiums are paid due to the name the goods bear. But that's generally a good thing as higher fixed prices will only encourage competition at lower price points.

[GodOfRhythm]

Welcome to Europe...