An article at Billboard.biz about new "pawn shop" laws just passed in Florida and Utah (and pending in Rhode Island) blew my mind. In Florida, the legislation would require shops that sell second-hand goods to apply for a permit, fingerprint sellers and get a copy of the seller's I.D.

Wrote Ed Christman, "Laws that result in the curtailment of used CD sales likely would be considered good news to record labels and music distributor executives who have long abhorred the growing strength of the used CD market."

There's an angle those who abhor may want to ponder. Labels, distributors and retailers should consider this consumer mental calculation: When purchasing a new CD, some shoppers build in to the purchase price an expected salvage value. For example, a $16 dollar CD with a $4 salvage value has a net cost of $12. Take away the $4 salvage value and the CD's cost just shot up 33%. In that sense, the used CD market is actually a very good thing. It defrays the purchase price of a new CD.

Or you could look at it from a perspective of risk. If a shopper knows resale is more difficult, he will be less likely to risk $16 and more likely to seek out a less risky alternative (P2P, a la carte downloads at iTunes, have a friend burn a copy of the CD, order a large pizza).

Is the used market really that strong, or is it relatively strong because the new CD market is so weak? My vote goes for the latter of the two choices (based on used bin selection and lower payouts in recent years). Eliminating the second-hand market is a misguided tactic that will end up hurting new CD sales. More than anything, it's a classic example of companies worrying about symptoms rather than the larger problem.

[music jobs] HR Manager at EMI NA; New York, NY.