US DoJ opens up a probe on digital music price fixing

This is bad news for the music companies, which have been pressurizing Apple to raise the prices on their Apple iTunes digital content store since quite sometime. The U.S. Department of Justice has said that they are opening up an investigation into online music pricing by major record labels.

The US justice department would enquire into whether the labels may have colluded to set prices. This might result into issuing of subpoenas to the companies. Nothing has been confirmed until now.

Some of the targeted music companies are said to be EMI Group, Warner Music Group, Universal Music Group, Sony, and Bertelsmann. None of these companies have issued a statement on this issue till now.

Mark Mulligan, a research director for Jupiter Research spoke about this news event: “The music industry still isn’t sure whether the legal downloads market is going to grow or shrink the overall music market. Let’s face it; the DOJ wouldn’t be doing this if they thought they were fixing the prices too low.”

He further added: “There’s a big part of this investigation that would have to consider these different market factors to determine why prices are where they are.”