Saihan Seido - Japan's Resale Price Maintenance System

Topics: Suggested retail price, Pricing, Japan Pages: 3 (900 words) Published: March 30, 2009
Saihan Seido - Japan's Resale Price Maintenance System (2005.02.05) For both domestic and overseas fans of Japanese music, the comparatively high price of Japanese CDs can be a real turn-off.

According to the Recording Industry Association of Japan (RIAJ), which represents Japan's major record companies, the average retail price for a new CD release in Japan is between 2,500 and 3,000 (between $24 and $29 as of February 2005) - more than 20% higher than in the United States and at least Double the price of music in most other Asian countries.

A key reason for Japan's high CD prices is its resale price maintenance system - known as the saihanbai kakaku iji seido, or saihan seido for short. The saihan system applies to six categories of copyrighted material: CDs, records, cassettes, books, magazines, and newspapers. The system, established in 1953, allows owners of copyrighted material to set the minimum retail price of newly released or re-released products, thus eliminating any possiblilty of discounting.

The stated logic behind the implementation and preservation of this unique system is that it reduces price competition between retail outlets, enhancing stability and competitiveness. Additionally, the recording industry defends the saihan system by saying that it ensures that a wider variety of recordings will be released. In that connection, it is interesting to note that the number of individual titles released by the RIAJ's member companies fell from 20,930 in 1994 to 14,678 in 2003. Of the 2003 total, 10,900 titles were new recordings, up 2% from 2002, but down 13% from 1999 .

The future of the saihan system has been a hot topic since 1995, when the Japanese government's Administrative Reform Committee's Subcommittee on Deregulation released a report recommending its abolition within five years. Copyright owners countered by claiming that the products protected by the system didn't fall into the category of "commercial product" and thus are not...
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