Digitalblue warned for price fixing

Digitalblue warned for price fixing

DigitalBlue has received a warning from the Commerce Commission for telling Dick Smith Electronics not to advertise an iPod accessory below a certain price point.

A DigitalBlue employee sent an email to a Dick Smith account manager in November 2005, saying that the IM7 iPod accessory should not be advertised for sale at less than 95 percent of DigitalBlue’s RRP.

Kate Camp, communications manager at the Commerce Commission, says the warning to DigitalBlue comes after what the Commission calls retail price maintenance. “We get a few of these every year, they’re not uncommon. We opened investigations into DigitalBlue, which are now closed.”

DigitalBlue was found to be at risk of contravening Section 37 3. b) of the Commerce Act, which prohibits a suppliers attempt to induce a reseller not to sell goods below a price specified by the supplier.

DigitalBlue’s Managing director, Jamie Cox, would not comment on the Commerce Commission’s warning. “We have to keep in mind the competitive environment for the consumer. The consumers don’t mind what effect it might have on the value proposition of the product,” says Camp.

General manager of the Commerce Commission, Geoff Thorn said in a release that Digitalblue should consider very carefully the implications of any future communications with retailers regarding pricing. “This kind of communications must not occur again.”

The warning does not constitute a ruling of law, and the Commerce Commission considers the matter closed. DigitalBlue will not incur any further penalties.

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