The United States Supreme Court struck that down last year. The practice is not only legal, but it’s supported by 5 of 9 Supreme Court justices. As is forcibly seizing your private property for commercial use. God help us.

I wonder if there are more independent Apple Shops out there than independent Generic PC retail shops? (It’s freakish to see how Tekserve in NYC has grown from a few guys on the second floor in a nondiscript building on 23rd street with a 10 cent old time coke machine (working!) to the glorious yet superficial place that it is today.

Protecting the Mom and Pop stores makes sense for any high end manufacturer. Apple was getting screwed by CompUSA and other major computer stores.

It just makes sense for the high end manufactures to avoid having their products turn into commodities. I mean it makes sense in the short run (HP, Compaq, Gateway, Micron, and Dell) but in the long run, when Price is the only thing that matters, somebody is going to beat you at your game.

The oil companies have been lowering their prices incessantly since “unconscionably excessive” gas prices were banned by congress.

Would this prohibit manufacturer’s from setting a maximum price for their products as they currently do? Remember the Wii being purchased for $250 then sold on ebay for $500 last Christmas? Are we to let retailers like Best Buy jack up the price to $500, ruining the marketing plans for Nintendo who rely on adoption of their game console by a certain market segment in order to sell games and peripherals?

Resale price maintenance involves a supplier setting or seeking to set a minimum price below which its retailers cannot sell, advertise, display, or offer goods for sale. It is prohibited by section 48 of the Trade Practices Act 1974.

and even small players get caught out check out the legal notice at http://www.oobi.com.au

the funny thing is that i love shopping in the States becauses its almost always less expensive!

Three things:

1. The manufacturer can choose to sell or not to sell to the retailer that’s there choice, but what they retailer does afterwards is none of the manufacturer’s business. This is like the manufacturer dictating what a consumer can and cannot do with the item after its purchased. Fundamentally, I believe my rights begin and yours end at the point of transaction.

2. If the manufacturer wants a better experience for its customers, it can build them and people will come. Apple, Sony, Nokia all have stores where you can buy their gadgets. Of course, these manufacturers will be bound by the retail economics. I had a shoe retailer ask me once why Nike would not want to open a 1000 stores in China and I told him look at the income statement. Nike’s margins are 45%, yours are 10 – 15% – investors don’t pay outrageous multiples for 10 – 15% margin.

3. Business plans. Not everyone has the same. Some are built on small selection, low margin, large volume product and some are built on niche products, large margins, and small volumes. The market will ultimately find which one it likes and MAPs just distort this.

I get this sick feeling that someday we’re going to be having a discussion about how Wal-Mart is too big to fail.

2. Anti-dumping issues are raised by the smaller disadvantaged entities, not the giants. In this case giants are trying to deflect the market pressure on prices (deflation).

3. We cannot mix service with the product. If I want better service, I go to a better store with the same product selling for a little premium in price.

Now, why does the manufacturer care how much minimum profit margin their resellers must maintain? What if Santa Claus keeps buying their products, distributing them for free? Will they go after him too? (Yes, Virginia, there is a Santa Claus.) They should control their own prices at which they sell to the resellers and the resellers are smart enough to chart their own course. Let the free markets rule! Protectionism can not, has not, and will not work.