The Columbia House brand was introduced in the early 1970s by the Columbia Records division of CBS, Inc. as an umbrella for the music club of its messages, the main incarnation which is Columbia Club Recording , was founded in 1955. It had a significant market presence in the 1980s and early 1990s. In 2005, longtime competitors BMG Direct Marketing, Inc. (formerly RCA Music Service or RCA Victor Record Club) purchased Columbia House and combined operations. In 2008, the company (as well as Bookspan book club manager) was acquired by private investment group Najafi Companies, and its name was changed to Direct Brands, Inc.
Although Direct Brands closed its mail-order music operation in mid-2009, it continued to use the Columbia House brand to market video in the US and Canada, selling DVDs and Blu-ray through the controversial practice of billing of negative options. The assets of DB Media in Canada ceased operations on December 10, 2010, and all staff were laid off, while US operations continued as usual. In December 2012, the company was sold to Pride Tree Holdings, Inc. In 2013, the company changed its name to Filmed Entertainment Inc. Sales of DVD division at bankruptcy auction announced August 10, 2015.
Video Columbia House
History
Fast growth
The Columbia Record Club was formed in 1955 by CBS/Columbia Records as an experiment to market music directly by mail, spurring sales to rural consumers and leading to competition from mail-order companies from outside the recording industry. New members to the club are interested in free notes just to join. To meet the demands of brick-and-mortar retailers, the title in the club catalog is available only six months (then, three months) after retail release, and the retailers who help brand members get a 20% commission. By the end of the year, the club had 125,175 members who had bought 700,000 records (net $ 1,174 million). The operation grew so fast that, in 1956, he was moved from New York City to a new base: a distribution center in Terre Haute, Indiana, a railroad accessible city where Columbia recently opened a record testing facility. Within a year, the club has 687,652 members and has sold 7 million records ($ 14,888 million net) and, in 1963, it ordered 10% of the retail music recording market.
Controversial license
In the late 1950s both RCA Victor and Capitol Records started their own licensing programs, but the three recording clubs rarely allowed their own label releases to be marketed by competitors. For example, the Columbia recordings are not available from the RCA Victor Record Club, and RCA records are not available through the Columbia Record Club.
In 1958, facing the loss of members who wanted more recording types, the club began producing and marketing footage for certain competitor labels (including Verve, Mercury, Warner Bros, Kapp, Vanguard, United Artists, and Liberty). Rival clubs operated by RCA and Capitol only offer their own label products at the time. The licensee secured a minimum amount of sales, but held for an exclusive, limited contract, which led to charges of pricing against the club in 1962, followed by 7 years of largely ineffective litigation. The licensing program continued and expanded in the 1960s as the music industry grew and changed.
The new format and appearance of the Columbia House
The Columbia Record Club began marketing the stereo recordings and equipment in 1959, reel-to-reel recordings (through Columbia Reel-To-Reel Club) in 1960, 8-track cartridges (through the Columbia Cartridge Club) in 1966, and tapes ( via Columbia Cassette Club) in 1969.
The Columbia Record Club is also well known for continuing to release products in a format that is no longer available in the commercial market. After the major record labels stopped releasing albums on reels to record cassette formats, Columbia still continued to make new titles available on reel recordings until 1984. 1982 was the estimated year the 8-track band disappeared from record stores, but Columbia continued released new titles in the format until 1988 and finally after a major record label left the vinyl LP format in 1989, Columbia released new titles on vinyl until 1992. In all three cases, new releases on abandoned formats are usually limited to new ones. Selection of the Month title (although country of the Month music selection is never available on tape reel unless it has crossover appeal possibilities to members of the Pop/Rock or Easy Listening club).
In the early 1970s, "Columbia House" had become an all-around brand for divisions, led by Columbia Record Club, later renamed Columbia Record & amp; Tape Club. In 1975, membership was more than 3 million.
In 1982, the CBS Video Club, which had shaped the previous year as the CBS Video Library, became part of the Columbia House family. Also, during that same period of time, Columbia House and The Cannon Group established the UK's exclusive UK mail order distribution service. Sony acquired CBS Records Group, including Columbia House, in 1988, then on 6 million members. Bertelsmann Music Group recently acquired RCA Records and renamed its only surviving competitor Columbia House, RCA Music Service (formerly RCA Victor Record Club), to BMG Music Service.
In 1991, CBS Records Group changed its name to Sony Music Entertainment and Sony sold half of Columbia House to Time Warner and joined Time-Life video and music clubs. Membership of more than 10 million by the end of that year. The influence of Columbia House and other music clubs peaked in 1994, accounting for 15.1 percent of all CD sales. In 1996, the club's membership reached 16 million. That year, the Columbia House website was launched.
Meanwhile, the parallel club, Columbia Record Club of Canada, operated by the Canadian branch of CBS Records since the late 1950s until membership and financial problems caused the destruction in 1977. It was relaunched in 1979 as the Canadian Music Club, attracting 100,000 members at the end that year.
Market drop
In mid 1999, the merger was announced between Columbia House and a struggling online retailer CDNow, a publicly owned, publicly owned company that has funding and other partnerships with Columbia House and its owners Sony and Time-Warner. The merger was abandoned in early 2000, with the poor finances of Columbia House and the intense competition of the online giant Amazon.com referred to as a factor. Within months, CDNow was bought by Bertelsmann, who partially combined it with BMG Direct into a business called BeMusic. CDNow was taken over and merged into Amazon the following year. In 2001, music clubs accounted for less than eight percent of all CD sales, to coincide with the rise of internet stores and retail outlets such as Amazon and Wal-Mart, which offer music at the same discount without subscriptions.
Security violation
In 2001, security breaches on the Columbia House website revealed thousands of customer names, addresses and portions of credit card numbers, leaving personal information about customers vulnerable to exploitation. This issue involves specific sections of the website, which can be easily accessed by removing some of the website addresses in the address bar, found by Mark Alway's customers. After the discovery of the offense, he sent an email to Columbia House staff who quickly responded to the problem. This event raises concerns over the ability of websites to keep personal information safe from hackers or destructive fraud. Although no information was reported to be obtained from a temporary breach by Columbia House, industry professionals quickly pointed out that a simple mistake is a consequence of handling inattentive customer information.
Consolidation and downsizing
In 2002, Sony and Time-Warner sold 85% of Columbia House to The Blackstone Group L.P., an investment firm based in New York. The following year, the possibility of merging Columbia House and Blockbuster Inc. reported in Wall Street Journal , Associated Press reports, and trade publications. Although the owner is said to be in talks, mergers never materialize.
In 2005, long-time competitors BMG Direct Marketing, Inc., currently the owner of BMG Music Service, acquired Columbia House, renamed joint company BMG Columbia House, Inc., and consolidated operations under the name of BMG Music Services.
In 2008, the company, including the Canadian branch, was acquired from Sony BMG by investment company JMCK Corp., a Najafi Group company based in Phoenix, Arizona, and its name was changed to Direct Brands, Inc. Direct Brands consolidate the remaining facilities. , and shut down mail-order music operations on June 30, 2009. However, Direct Brands continues to operate DVD and Blu-ray Disc clubs under the Columbia House brand in the United States and Canada. The Columbia Home name is still owned by Sony Music Entertainment, and is used under license.
In December 2010, the Canadian branch went bankrupt, and its website began to direct visitors to an explanation letter from the trustee of the company in bankruptcy.
Bankruptcy
The parents of the music club and DVD Columbia House announced on August 10, 2015, that they plan to sell the Columbia House DVD Club business, which sells movies and TV series recorded directly to consumers, through bankruptcy auctions.
Return to music sales
In December 2015, the owner of Columbia House, John Lippman, announced its intention to start a vinyl subscription service that will allow customers to select the recording and music genres they receive.
Current ownership
While Sony Music still owns the Columbia House trademark, Edge Line Ventures LLC is the current licensee of the Columbia House name.
Maps Columbia House
Business practices
Following the sale of Columbia House to BMG and continuing after the sale to Direct Brands, Columbia House has invited criticism over its business practices, some of which are outlined here:
Membership
Membership is an agreement in which the customer agrees to buy a minimum amount of film at a regular sale price. To join , or enter a legal obligation, the customer agrees to purchase a discounted movie at the beginning, sent as part of the "welcome package". During the term of the agreement, the minimum number of price list films should be purchased. Twenty-one times per year, the company notifies every customer of the movie "Directed Director". The customer is asked to answer within 10 days whether he wants to buy this movie or not, offered at a discount, provided that the response is received by Columbia House "within the stipulated time." Failure to respond to results in having movies submitted at full listing prices. If the customer responds negatively but in time, the idea is that the movie is not sent or charged to the customer's account. In certain circumstances, "membership" is available, in which the customer is not required to respond to the Election of Director's email unless he/she wishes to purchase the movie. When such membership ends, the old rules back to the place of response are necessary in time to prevent full-fledged movie submissions without customer input. Customer is not reminded when the rule changes. Customers also have access to a large number of other movies, which are advertised by mail and online towards customers. Only full price purchases that deplete the minimum purchase obligation. Purchases are not cumulative, which means that two movies purchased for ten dollars do not drain the purchase of a movie at a minimum price by a single film. If the minimum amount of the film has not been purchased at the end of the semester, the film's monetary value is charged to the customer's account. If a purchase was made using a Columbia House sale device, be it a credit card or debit card linked to a credit card account, then the account is automatically debited. The Company will send a reminder letter or email notification before the commitment expires, giving customers the opportunity to purchase the necessary purchase obligations before they are charged for commitment or contract costs. Likewise, the backorder movie is automatically debited to the account when it is available, without further notice to the customer. Failure to remove such purchases resulted in Columbia House collecting efforts against customers.
"Fun Cash" and "Dividend Dollars" and "Bonus Points"
Columbia House offers a point system, where movies purchased produce "points" or "Fun Cash" ("Dividend Dollars" is a term used when movies come in VHS format, which no longer occurs). Fun Cash does not transfer from one subscription to another. There are a number of restrictions for the use of Fun Cash, which generally make regular re-registration at a lower cost and a more tangible option for those interested in savings. The currently used points system is called Bonus Points, and works under the same idea as Fun Cash.
Other clubs
Columbia House has made forays into media other than music and movies. For several years, Columbia House offers a CD-ROM club, allowing customers to purchase computer games. Now allows members to buy video games from their site, but so far has not offered a special club for this. You can also enter into agreements on regular purchases of "box sets", which are a compilation of the popular TV series. One agreement, allowing customers to access one of Columbia House's products. Everything can be sourced through the company website.
Negative option billing practice
Columbia House practices negative option billing, a form of commercial distribution in which the service is automatically supplied to the consumer until a specific cancellation order is issued. This practice has attracted many complaints from consumers. The Federal Trade Commission has published information to protect customers against this practice, specifically referring to $ 0.49/video bids.
Alleged sale of cheating debt
In December 2008, BMG Music Service (now yourmusic.com) allegedly sold a large number of fraudulent debt claims to collection agencies, National Credit Solutions. The criminals should not be known for their debt and most do not make a purchase with the company for at least five years. Victims selling counterfeit debt claims are not known to either their debt or accounts opened with the National Credit Solutions. Most victims learn from a collection agency account when they are denied for a loan, have a credit card canceled, or check their credit report.
Classroom action settings
On August 4, 2011, a nationwide class action lawsuit filed against Columbia House (Direct Brands Inc.) sought monetary damages and an order to stop alleged unauthorized direct trademark business practices, the inability to cancel, unwanted products sent home and some other alleged issues.
Better Business Bureau ratings
In 2010, the business had unsatisfactory ratings with BBB due to failure to respond to complaints. The company also has an unsatisfactory record due to the complaint pattern. Specifically, complainants allegedly received merchandise and/or bills for merchandise from BMG/Columbia House for CDs and/or DVDs they did not order. Complainants further allege that they do not join BMG/Columbia House and do not know how the company obtained their information and that the company's phone line and website does not provide direct customer service representatives to help resolve the issue.
References
External links
- Official website
- Consumer Advocate Site
- FCC quote to Columbia House for violating DO NOT CALL REGISTRY legislation
- Not satisfied BBB 1 Rating
- The BBB Scores Are Not Satisfactory 2
- Consumer Affairs Page on Complaints against the Columbia Building
- The US District Court's decision on Sandra L. Pruett vs. The Columbia House Company
- Back To Sender: Music BMG Has Been Stopped
- "12 For One" CD Deals No More: BMG Music Service Ends In June
Source of the article : Wikipedia
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