Winehouse album sparks import battle

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NEW YORK -- In the mid-1980s through the mid-1990s, major labels cracked down on retailers carrying import albums as a matter of course -- at one point, CBS Records even sued Tower Records over the practice.

For the most part, such import battles have since receded into the background. But a controversy over an Amy Winehouse album is, at least temporarily, putting the issue back in the forefront.

Most merchants Billboard surveyed said they will comply with a letter from Universal Republic that threatens to sue retailers and merchandisers that continue importing and selling import copies of Winehouse's 2003 debut album, "Frank." But other retailers are arguing that, in the age of downloading, it's absurd for a record label to take Universal's approach.

"We are selling physical product that the customers want, and they are trying to stop us," one merchandiser said. "In the meantime, it is flowing freely throughout the world over the Internet through the (peer-to-peer) sites."

Universal Republic, which has enjoyed great success in the U.S. with Winehouse's "Back to Black" album, plans to issue her earlier album "Frank" on Nov. 7 stateside and wants to prevent imports from cannibalizing potential sales.

"Frank," which came out in Europe on Island, has sold some 18,000 copies in the U.S. as an import, according to Nielsen SoundScan; meanwhile, since its Dec. 19 release, "Back to Black" has sold 950,000. Universal insiders said that because the label's goal for the latter is 1.5 million-2 million copies, Universal is holding up the release of "Frank" to get the most mileage out of "Black."

"We have been selling 'Frank' long before (Winehouse) become hot here in the U.S.," said Eric Levin, owner of Criminal Records in Atlanta and the head of the Alliance for Independent Media Stores. "We can certainly wait, as we have been asked to do."

"Universal is just trying to protect their business," said Michael Kurtz, who heads indie coalition Monitor Store Network. "We get the message; we won't carry it anymore."

In general, merchants -- who foresee weightier issues with the majors down the line -- said the stakes of the "Frank" album are not high enough to justify taking a stand or risk getting sued.

Still, some merchants and wholesalers said, the tone of Universal's letter left a lot to be desired. "There didn't seem to be a lot of thought behind it besides bullying and greed," one music merchandiser said.

In one passage, the July 24 letter says: "Republic hereby demands that you cease and desist with any and all distribution and/or exploitation of the album in the U.S.," because it constitutes an infringement of Republic's exclusive right to exploit and distribute the artist's recording in the States.

The letter, signed by Universal Republic director of business and legal affairs Jeffrey Koenig, furthermore asks that all accounts respond within two days of receiving the letter with a written acknowledgement that they have ceased selling the import version of the album.

Though such letters were commonplace 15 or 20 years ago and Canadian imports were a hot topic around the turn of the century, the import issue receded as the U.S. dollar's decline against most other major currencies made imports from most foreign markets unfeasible.

One wholesaler claimed that the primary reason Universal Republic is now issuing Winehouse's "Frank" is because importers first proved the album commercially viable in the U.S.

On the contrary, a source at Universal Republic said, "The only reason the import album has scanned 18,000 units is because of all the time, effort and money that we put into 'Back to Black.' "

One wholesaler put yet another spin on the Universal letter. "What's happening is the whole music industry is suffering," that executive said. "Everyone is looking for sales, no matter how small, wherever they can."
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