New York AG online marketing probe
p2pnet view Crime:- New York attorney general Andrew Cuomo has “launched an investigation into the marketing practices of 22 online retailers, including Staples, 1-800-Flowers.com, and Orbitz,” says CNet News.
“Cuomo’s office said Wednesday it issued subpoenas to the merchants and requested information about the retailers’ relationships with three marketing companies, Webloyalty, Affinion, and Vertrue,” says the story, continuing:
“These firms have allegedly misled consumers for years into joining membership programs and paying monthly fees.
“Webloyalty and the other companies are so-called post-transaction marketers that have compiled a long history of consumer complaints and class-action lawsuits. Typically, the three firms present pop-up ads to online shoppers when they’re finalizing a transaction. Some consumers have said the ads appear to be a discount coupon from the retailer.”
But, “Buried in the fine print” the full terms state by “providing an e-mail address, the customer is agreeing to sign up for a membership program and authorizing their credit card to be charged sometimes as much as $20 a month,” says CNet, noting >>>
Some people go months and even years before realizing that they’re being charged. The government’s investigation has also uncovered evidence that some of the Web merchants involved are aware their customers are duped into joining. It’s safe to say many consumers believe the only way that their credit cards can be charged is if they key in their card information. That’s the way it has always worked in the past.
Alleged price fixing
In another rip-off case, the Big 4 record labels are again in the public eye for alleged price fixing, with the claims being “proved” by Cuomo’s office in New York.
Said the Associated Press, earlier this month >>>
The [28 combined] lawsuits accused the record companies of agreeing to the wholesale price floor of about 70 cents per song when other services began offering Internet music at a cheaper rate.
The 2nd Circuit noted that eMusic, a popular online music service selling songs produced by independent labels, charges 25 cents per song and places no restrictions on how purchasers can upload their music to digital music players. It also noted that the defendants refuse to do business with eMusic, the No. 2 Internet retailer, trailing only the iTunes Store.
The appeals court also noted that the alleged price fixing is being proved by the New York State attorney general and is also subject of two separate investigations by the Department of Justice.
Practice of last resort
This last item is particularly interesting and “one wonders if it might present difficulties” for Cuomo, said p2pnet, noting he, and not Vivendi Universal, EMI, Warner Music and Sony BMG, is the author of the RIAA’s new we won’t sue ‘em all ploy.
“We knew Cuomo was employed as front man for the new RIAA tactic, but we weren’t aware he’d actually originated it,” we said, going on >>>
However, “During this past summer, we began discussions with New York Attorney General Andrew Cuomo, who suggested that now was the time to take our practice of last resort – lawsuits – and replace that form of deterrence with productive engagement by the ISP community in the form of graduated response programs,” The Flat Hat, the College of William and Mary’s student newspaper, has RIAA boss Mitch Bainwol flatly stating.
He’s mistaken in calling the RIAA sue ‘em all campaign a practice of last resort, of course. The law suits, launched in 2003, were, and still are, the corporate music industry’s weapons of first resort.
The Flat Hat post refers to the RIAA claim that ISPs are ready and willing to take action against their own customers on behalf of Vivendi Universal, EMI, Warner Music and Sony BMG.
This was probably the first refence to what has become the Three Strikes debacle under which the entertainment cartels — yes, cartels — are attempting to shanghai governments around the world into turning an industry business plan into local law under which administrations are corporate copyright agents, and ISPs enforcers, acting against their own customers.
Stay tuned.
Jon Newton - p2pnet
..… and identi.ca
First they ignore you, then they laugh at you, then they fight you, then you win ~ Mahatma Gandhi
CNet News – New York examines Web marketing ’scam’, January28, 2010
price fixing – Big Music in price fixing lawsuit. Again., January13, 2010
Associated Press – NY Court OKs Internet Music Sales Lawsuit, January 13, 2010
p2pnet – ‘We won’t sue ‘em all’ ploy Cuomo’s idea: RIAA, Januarfy 30, 2009
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