Diamonds & the RIAA

eaglebtc writes "After reading the previously-posted article on cdfreaks.com about the rapid erosion of cheap CDR's, I found another equally scintillating write-up about the economics of music CDs written by Richard Menta, founder of MP3 Newswire. Sure, we've all heard the whining about how CDs are so expensive, but Mr. Menta takes a unique perspective on the issue by comparing the RIAA to DeBeers. He argues that both companies control distribution of products in their respective markets with an iron fist, and by so doing can artificially raise prices. Coincidentally, the bubble is beginning to burst in both markets: the RIAA is fighting against the uprisings of P2P software, and the diamond cartel's lawyers are losing sleep over the $5 diamonds produced in a lab."

Re:The names may change, but

[the MaD HuNGaRIaN]

Diamonds in jewelry are overrated any way.
There are much prettier stones available, many with cool characteristics [gemstone.org]

control is the problem

[514x0r]

the problem i've had with riaa for a while now is the discrepency between cost and sell. if a cd costs several times less to produce than a cassette, why does a recorded cd cost up to twice as much. perceived value. incidentally i used to be the IT manager for a jewelry wholesaler and it opperates much the same way there.....and they are getting boned over these lab diamonds

Re:DeBeers never promised

[SimReg]

"first CD's that came onto the market at what.....$15-20? Did the price on those ever come down? No."

Yeah, but wouldn't inflation make the prices lower, when compared to today's dollars?

So in a sense, by not raising the dollar ammount, they have lowered prices.

RIAA & CD Sales are hand in hand, kind of...

[phaetonic]

Did you know that there is a 2% surcharge on all CD recorders sold that goes directly to the RIAA, and a 2% hidden tax associated with the AHRA that is collected by the RIAA to give to artists, yet only roughly 36% of that 2% goes to the artist. www.boycott-riaa.com

Industrial quality?

[A nonymous Coward]

You aren't paying attention. Previous artificial diamonds are too small for gems, they are used as abrasives in drill bits and so on.

These new companies are not making diamond dust, they are making gem size diamonds, and plan to use the income from that, as they destroy deBeers, to finance making diamonds for semiconductors, as in huge wafers.

Maybe you could come up with some definition for "industrial" diamonds, whatever that is, and then update it for the new artificial diamonds, and realize it has no more meaning.

Re:DeBeers never promised

[Anonymous Coward]

Inflation didnt keep cd player prices at 1000$$ though. Or ram prices at 100$$ per meg, etc etc.

The Cost of making a cd has gone down to pennies, yet prices stay the same. Dont forget this is the same RIAA that was convicted of pricefixing cd's.

Re:They aren't so worried about $5 synthetics

[Sheeplet]

Did you read the wired story? They're making gem-quality diamonds for $5 a carat, that you can't tell from the mined counterparts. They're not talking about diamond dust used to coat saws here....

Don't want to give DeBeers money?

[Mr. Flibble]

So, lets say you have to buy a ring*, but you don't want to give DeBeers money. I suggest you buy Moissanite [howstuffworks.com] ring. Myself, when faced with that decision, I bought a Tanzanite ring because my honey likes Tanzanite, and I hate DeBeers.

True, Diamonds won't be expensive for long, and Moissanite is cheaper now, and may eventually cost more than diamond. But, Moissanite is harder than Ruby, and has a greater luster than diamond, and it also costs about 1/10 of what diamond does today.

* One day, you will find a nice little woman who wants a ring, and generally it is best to get her one! ;)

Re:Labor Of Love

[Jucius Maximus]

"Yeah well, not being from the US (North America)I never quite understood that tradition, for ten grand I knew better things to do than buy a ring."

The DeBeers marketing campaigns are brilliant. If you are exposed to them from a young age and see fictional weddings on TV and how they focus on the ring, you will understand. It is ground into North American minds from the very beginning. Most people in North America know what I'm talking about when I refer to the "A Diamond is Forever Music."

Re:Help the RIAA - Not a Troll

[Anonymous Coward]

That's the point, dumbass.. they don't deserve "billions off of online sharing." They're making cash off of distribution, which is nearly worthless in today's market.

What we need to do is figure out a way for good artists to pull a reliable 50-60k a year, and leave it at that.

Blood Diamonds - Does RIAA have blood on its hands

[leoaugust]

Because this is about the RIAA, and it brings out the worst in me, I couldn't help but bring your attention in this analogy of the diamond trade and the music trade - the "Blood Diamond." Does the RIAA have blood on its hands ... (of course this is meant only in the sense of extending the analogy ... so RIAA please don't try to sue me ... ha ha.)

Blood Diamonds [amnestyusa.org]

http://www.amnestyusa.org/amnestynow/diamonds.html

Greg Campbell is the author of the forthcoming Blood Diamonds: Tracing the Deadly Path of the World?s Most Precious Stones (Westview Press), to be released in September 2002.

Illicit diamonds make fabulous profits for terrorists and corporations alike. The trade illustrates with the hard clarity of the gem itself that no matter where human rights violations occur, the world ignores them at its peril.

Market data concurs with Menta's analysis

[tagishsimon]

At the risk of karma whoring ... since I posted much the same story a couple of days ago ... the latest market data in the UK [bbc.co.uk] suggests that reducing the bloated price of CDs increases sales (wow) to - for the UK- record high levels (gosh, who'd have thought in the year of Kazaa that we'd see record CD sales?).

The RIAA's "xxx's is killing music" (substitute cassettes, P2P, MP3, whatever comes next) is somewhat undermined by all of this.

Menta makes the point that CDs are priced by the big five at the point that maximises profit. No surprise then to hear that whilst UK CD sales were up by 3%, profit was down by 2%.

Re:Labor Of Love

[Ominous Coward]

DeBeers. They captured the south African diamond market early last century, and then gave diamonds to famous actresses to make them more popular. They had a hard-driving advertising campaign that continues to this day, but in the 1800s and before, diamond wedding rings were nearly unheard of.

Seriously, other gems really are much prettier. Diamonds aren't even "forever". They can be incinerated, and there are harder substances than diamond...how would they cut them if there wasn't anything harder?

Linares' patent for vapor deposition

[Kazymyr]

Just in case anyone is interested, here's a link [uspto.gov] to the patent Linares received for their vapor process.

Re:Synthetic diamonds

[Cytotoxic]

synthetic diamonds are almost always made using catalysts like nickel or iron - thats why they are yellowish. usually

At the risk of being labled a neophyte, I suggest that you RTFA. They specifically talk about making clear gemstones using the metal solvent process (it takes longer than yellow), and they also spend a good deal of time talking about carbon plasma deposition, which is being done in Boston right now and creates absolutely flawless stones. It is this process that is of interest for producing semiconductor substrates. The $5 gemstone is simply a stepping stone on the way to diamond based computer chips running at tens of gHz. That is the "News for Nerd" that really matters.

DeBeers has been much more effective than RIAA

[sd_jeff]

Not sure how things have changed in the last 20 years since this article came out, but here's an interesting piece on how dimaond engagement rings are an invented tradition that only started 60 years ago. (It's comes in three parts b/c it's pretty long.)

part 1 [theatlantic.com]

part 2 [theatlantic.com]

part 3 [theatlantic.com]

More info on Diamonds

[dinog]

Available at PBS [pbs.org].

DeBeers is an even bigger fraud than the RIAA. Diamonds (even natural ones) are not really scarce. Also, the new lab methods do not all rely on the mettalic solvents to create diamonds. One is deposited as plasma, with no extra gunk in the process. They are white diamonds, of unusual perfection.

BTW, Plastic [plastic.com] had this a few weeks ago [plastic.com].

Dean G.

Re:How *could* it work?

[Cytotoxic]

DeBeers dosn't have a total monopoly on diamonds now, and there is no reason that any democratic government would give them total control.

Actually, you are completely wrong about this. Frontline and Nova have both done excellent documentaries about the depth of control of the DeBeers cartel. A couple of examples that I can remember include Diamond National Park in the United States, which was declared as a national park to block it's exploitation as a diamond mine. Also, when a huge supply of pink diamonds was discovered in Australia, DeBeers moved to block the companies mining the diamonds by lobbying the political leadership. When that failed, they simply bought nearly 25% of the publicly traded stock of the entire country and then had the boards of all of the major companies in which they now owned a major stake lobby the government on their behalf. Done deal, diamonds significantly restricted. The examples go on, but I highly recommend the Frontline documentary for those who think that democracy is a barrier to DeBeers.

Alternative to the DeBeers Engagement Tax

[Mr. Neutron]

http://www.betterthandiamond.com/ [betterthandiamond.com]

Look at their Asha stone. My wife and I got one of those for our engagement, and the jewlers who put together the ring said that they were fooled from two feet away. And it's harder than anything else non-diamond.

Maybe someday we'll replace it with an actual synthetic diamond!

the difference is...

[jpc]

the people who run De Beers never enter the USA because they will be arrested for running an illegal cartel. Europe has a few De Beers shops now (not sure why we think they are legal). I think it was a judgement 10 or 20 years ago that the diamond cartel was illegal, dont remember the exact details, but it comes up quite often, becasue it is difficult to run a large multinational without ever going to the USA

Re:Synth Rocks

[forkboy]

If you had read the article, you would have known that previous synthetic diamonds were as expensive to produce as natural diamonds are to buy. The two companies mentioned in the article have come developed methods to quite cheaply produce diamonds, which is why De Beers is freaking out...they can't compete with someone selling an equivalent of a $15,000 stone for $500. (well, they CAN compete with that, but they really don't WANT to since it means they don't have a strangle hold on the industry anymore.)

Re:The names may change, but

[jcoleman]

Have you ever priced an alexandrite ring? Diamonds are cheaper. WAY cheaper. Of course, there is always synthetic alexandrite...but then we are back to the fake thing again...

Re:Synthetic diamonds

[rgmoore]

It's the imperfections and other trace elements that give earth-mined diamonds their appealing sparkle.

In a word, no. The thing that gives diamonds their impressive sparkle is that diamond has an unreasonably high refractive index, which means that it is very good at bending light. The high refractive index gives diamonds their "fire", which sets them apart from other gems. Imperfections are one of the things that gemologists look for in diamonds largely because those that have detectable flaws are less valuable than those without.

Excellent Atlantic Monthly article...

[Draxinusom]

...about how De Beers essentially invented the global diamond market by both controlling the supply and creating the demand:

Have You Ever Tried to Sell a Diamond? [theatlantic.com]

Artificial diamons

[afidel]

Gem quality artificial diamons of significant size don't yet exist (at least not colorless although one company claims to have them coming out this fall), they will NOT be $5, but rather about 2/3rds the cost of the natural ones. And beyond that DeBeers has a flourescense test that will detect artificial diamonds. The real battle will be in convincing Jane Q Public that her man isn't being a cheapskate looser if he gets her an artificial stone for her ring. I have convinced my wife that the replacements to the 1/2 carrat earings that she lost will be 1 carrat synthetics with a gas deposited diamond coating, they are as pretty in the light as real diamons and cost about 1/4th what the smaller "real" stones cost me =) Of course not every woman is so ameniable as the misses.

Re:The names may change, but

[Snodgrass]

That's exactly the stone my wife picked out. Not only is it less money than a diamond, but all of her diamond wearing friends talk about her ring more than theirs, because it's so unique.

As an aside, alexandrite turns a sweet orangish-red under a black light. Very cool.

Re:You learn something everyday.

[Pyloo]

The other guys have already made the point that you are mixing up the two techniques.

Id just like to add that even if you are a solid state chemist, there is only one company in the world that has created these flawless lab diamonds (the guy from Wired had them tested) - and the only people who can tell you how do it work for that company, so you are unlikely to get an answer on how they got the metastable phase fixed.

The closest answer I can give you (and it is from the Wired article if youd care to read it) is:
To grow single-crystal diamond using chemical vapor deposition, you must first divine the exact combination of temperature, gas composition, and pressure - a "sweet spot" that results in the formation of a single crystal. Otherwise, innumerable small diamond crystals will rain down. Hitting on the single-crystal sweet spot is like locating a single grain of sand on the beach. There's only one combination among millions. In 1996, Linares found it.

If you want to know more about it then realise that (again, direct quote from Wired):
This June, he finally received a US patent for the process, which already is producing flawless stones.
So the information you require should be found in the US patent office.