The European Commission has published its draft regulations and guidelines on Vertical Restraints Regulation (VRR) and offered more safeguards to online-only businesses than many had expected.

This is good news as it preserves the consumer’s right to choose – which is what this blog’s ethos is all about.

Many have welcomed the move. eBay, which owns this blog (but commissions an independent writer), makes the following points:

“The Commission recognizes that many products need not be sold in brick and mortar stores and has introduced important tests that will prevent potential new abuses by suppliers who may attempt to unjustifiably exclude online-only distributors.

“The Commission also encourages competition authorities to support efficient distribution channels that benefit consumer choice, and we will certainly work with Member States by being vigilant and exposing any attempts to unfairly limit online sales.”

Consumerchoice.eu is proud to have played whatever small part it contributed in the EC’s decision process, and thanks all of our readers who took part in the consultation.

We will continue to publicise any examples of consumers’ right to choose being eroded.

Online price comparison site Pricerunner has taken the next step and compared prices offline as well – and it’s not good news for the buyer, who is paying an average of 31.79% higher than the online cost when the go into a shop.

The company did a mystery shopping exercise in several cities in the UK. It appears Manchester is where you’ll find the highest differential, where a basket of 10 items cost £562 more then the online cost of £1785.11. Sheffield was cheapest (but the basket still went north of £2000) with London and Edinburgh unexpectedly coming in the middle.

“Consumers are paying the price for shopping on the high street. 95 per cent of all the prices we found could be beaten online and the average mark-up on the best online price was a massive 31.79 per cent. That’s high street robbery,” says Mark Thomas, UK manager for Pricerunner. “There is obviously a cost associated with having a high street presence and some of that has to be passed on to the consumer. But with such variations in prices not only between cities but also between two ends of the same high street, consumers must not be fooled by in-store price points. The evidence is clear – it is cheaper to make your eventual purchase online and have the product delivered to your home.”

The research is published on the day on which the European Commission is expected to publish the draft of its Vertical Restraints Regulations, a process in which it looks as though major brands may gain the ability to discriminate against outlets without bricks and mortar retail premises.

The deadline for changes to the Vertical Restraints Regulations in Europe, which could result in manufacturers being able to discriminate against outlets which have only an online presence rather than bricks and mortar as well, is only five days away. There is still time to make your views known.

An EUBusiness.com report has more of the technical details here.

It’s now official – over half of people buying anything, online or in a shop, use the Internet to sanity check prices beforehand. 55% of people look online before committing to purchase, says new research from Bitkom. We believe new rules from the EU could jeopardise this valuable source of information.

The research included only people who were over 14, and found that not only did people research price but also other people’s opinions. Elderly people in particular are likely to be swayed by user reviews.

As you move into other online sources of information like chat rooms and user groups the number decreases – but it’s pretty clear, the online world is a major source of information for people about to buy something.

Once again this is an area of personal freedom that is under threat from Europe’s Vertical Restraints Regulation. This is something we’ve covered before and it will allow brands to discriminate against companies that don’t have offline retail premises.

The whole thing’s a nonsense. A buyer in London won’t be interested in whether or not a supplier has retail premises in Oslo or not, and is likely to be baffled that premises, which might be miles away, are a factor in their ability to compare prices and opinions.

This does appear to be a pernicious piece of legislation – and there are only days left to make your opinion felt.

Concerned about the world economy? You should be, if reportage worldwide is anything to go by.  So it’s good to be able to report on an area that’s growing by degrees – and baffling that the EU seems bent on damaging it.

The growth area is online retail. Newly-published intelligence from respected commentator Forrester points to double-digit growth for the next five years both in America and Western Europe. American online retailers will grow an average of 10 per cent a year for the next half decade while Europeans outstrip even that with 11 per cent. France will do particularly well, growing at 13%, while Germany grows 9% and the UK 10%.

Forrester believes that to make the most of the growth, e-sellers will have to give consumers the choice of how they want to buy things. This will include all manner of online buying including mobile phones, maybe the new Apple device and the PCs that exist at the moment.  The analysts also make the point that a choice of ways to buy is actually the only way some consumers can get at certain goods.  The presence of online retailers increases choice, simple as that.

It should be an explosion in growth: the average spend from an online shopper was €483 in 2009 and will be €601 in 2014, with books, tickets and clothing leading the charge.

This sort of growth is undoubtedly going to play a major part in bringing the Western world out of recession. This is why it’s incomprehensible to the Campaign for Consumer Choice that new laws are emerging within weeks that could force online companies to limit their growth by spending on offline retail premises as well.

We sincerely hope these proposed laws will be amended to allow online, offline and mixed channel outlets to compete fairly and without restriction, and benefit the consumer in the process.

Earlier this month we examined proposed European legislation concerning large suppliers’ possible ability to insist their retailers have bricks and mortar premises that customers can visit.

eBay has been campaigning on this for over a year, with Amazon joining the fray in public recently. eBay has been examining the latest draft: “The direction of the general text is very positive towards online commerce. (But) this brick-and-mortar provision is inconsistent with this,” eBay vice president Tod Cohen told Reuters.”Those who want to engage in price discrimination will have another tool to do it,” he added.

It would be less than honest not to declare an interest – this blog is owned and funded by eBay. But as an independent journalist I have interviewed many small businesses which started as eBay ‘stores’. There was the guy selling tropical fish. The men’s designer clothing outlet. These are reputable, professional businesses, some of which now have retail premises and some of which don’t, but which would not have been able to start if the proposed legislation had been in force at the time. The world economy has enough problems, we don’t need new business stifled at its inception.

This is at the heart of consumer choice. If a customer would rather buy from someone they can visit, fine – that’s completely allowed. If they don’t then they shouldn’t be prevented from doing so by new regulations.

Buying items online in Europe should be straightforward. You search for the product you want, you might well use a price comparison site, you check your favourite sites to see whether it’s available even less expensively and you buy.

This works as long as someone discloses their price.

Which is where recent events in the US are becoming interesting. A number of manufacturers are preventing online retailers from putting prices online in that territory.

The reason behind it is that following a key ruling in an American court, manufacturers now have greater freedom to forbid companies from advertising their goods below a certain price, so you find out the cost at checkout. In Europe, the rules on retail price maintenance are stricter, but this has not stopped some brands from trying to water them down.

It’s all part of an attempt to control retail prices. Premium goods manufacturers want their goods to retain premium prices and they perceive anything else as a race to the bottom.

But forcing others to conceal prices or dictating minimum prices doesn’t answer this. Make the items desirable enough so that people will want to buy them and you’ll satisfy the customer, the retailer’s profit increases and everybody’s happy. A hidden or enforced RRP is little more than a fig leaf.

One of the Web’s greatest strengths as a trading medium is its complete transparency. I want to buy a book, I check all the sites and I choose the best offer, following my own preferences on price and the site’s service levels. Yes, this might put pressure on prices (unless it’s a rare collector’s item in which case multiple buyers might drive it up), but that’s how a competitive, open market works

I can only hope that transparency will be restored. Everywhere.

The European Commission is considering allowing brands to force companies selling items online to have bricks and mortar shops for customers to visit as well. This comes under guidelines called the Vertical Restraints Regulations (VRR) and comes under competition law.
Frankly this is nothing less than an assault on the customer’s right to choose. Found a better price for something from a seller on eBay?  If it doesn’t have actual premises, it might not be able to sell certain brands in future. Got a bargain on Amazon? Tough – it doesn’t have a shop you can visit so it could be banned from selling you this product.
It really is that simple. Europe is considering limiting choices to places customers can visit. This is more than slightly patronising. People are generally intelligent enough to decide when they want to buy on the Web and when they don’t.
According to an article by Amazon in today’s Wall Street Journal the people in favour of the new rules believe the more traditional businesses make more investment. They train their staff, they put the hours in, they pay their rents and it’s not fair that the pure-play e-tailers get the business as a result.
This is a specious argument. First, shoppers frequently compare prices online and check reviews for the best product only to then buy offline, but no one calls that free-riding. Second, the e-tailers bring a lot of their own skills to the market: logistics, web design skills, none of these should be written off. The investments in technology, structures and customer service are a different, but equally legitimate business model by all means but that’s all.
And until now, customers have been treated as intelligent people who can assess what they want to buy and whether they want to buy it online. This is now under threat and I’d urge everyone to write to the European Commission’s Competition section (see http://ec.europa.eu/competition/contacts/index_en.html) and their MEP (http://www.europarl.europa.eu/members/public/geoSearch.do?language=EN) to try and kill off this requirement to have a bricks and mortar store as soon as possible. They must fight to stand up for the consumer’s right to make an informed choice about when and how to buy.
(Declaration of interest: this blog is owned and paid for by eBay, but the views expressed are those of the author).

The European Commission is considering forcing companies selling items online to have bricks and mortar shops for customers to visit as well. This comes under guidelines called the Vertical Restraints Regulations (VRR) and comes under competition law.
Frankly this is nothing less than an assault on the customer’s right to choose. Found a better price for something on eBay? Hard luck, it doesn’t have actual premises so it can no longer operate. Got a bargain on Amazon? Tough – it doesn’t have a shop you can visit so it could be ruled unlawful.
It really is that simple. Europe is considering limiting choices to places customers can visit. This is more than slightly patronising. People are generally intelligent enough to decide when they want to buy on the Web and when they don’t.
According to an article by Amazon in today’s Wall Street Journal the people in favour of the new rules believe the more traditional businesses make more investment. They train their staff, they put the hours in, they pay their rents and it’s not fair that the pure-play e-tailers get the business as a result.
This is a specious argument. First, unless a supermarket (for example) actually invented bread, it’s already riding on someone else’s efforts. That’s entirely fair in business. Second, the e-tailers bring a lot of their own skills to the market: logistics, web design skills, none of these should be written off. The investments in technology, customer service and the consequent lower prices are a different business model by all means but that’s all.
And until now, customers have been treated as intelligent people who can assess what they want to buy and whether they want to buy it online. This is now under threat and I’d urge everyone to write to their MEP and kill off this legislation as soon as possible. The National Competition Authorities are meeting about VRR today and need to stand up for the consumer’s right to make an informed choice about when and how to buy – if this legislation wins through it’s a hell of a blow.
(Declaration of interest: this blog is owned and paid for by eBay).

On Sunday 31 January a number of pubs in the UK showed a football match, Arsenal v. Manchester United. Nothing special about that– but the regulars were handed glasses and watched the whole thing in 3D.

Sky TV will follow this by launching its 3D channel in April so everyone can have a look. Everyone with a new 3D television, that is.

This is where the consumer is going to have to watch out. Last time we had the introduction of a new technology in television, high definition, it was chaos. We had Full HD, True HD and HD-Ready, all of which had different screen resolutions. The industry did a pretty bad job of explaining it all and sales – particularly for the online retailer, who by definition couldn’t demonstrate his or her technology in front of the customer – were slow to take off.

Now 3D has started emerging into the public domain, with the UK leading the way in Europe. We need to ask a few things of the TV manufacturers and broadcasters before buying:

·      You’re asking us to buy new TVs quite soon after we’ve all bought flat screens. Recession aside, are you going to start doing this every three years?

·      A number of sources suggest that the Internet is going to converge with TV, and some TVs already have bits of Internet on them. Is this going to involve yet more technology change – and will another new generation of TVs follow as a result?

·      Four manufacturers have confirmed 3D models so far, Sony, Samsung, LG and Panasonic. Will they all be adhering to the same standard or are we in for another Betamax v. VHS punch-up?

I’ve seen demonstrations and can confirm they’re pretty impressive.  The programmes, the technology, will be very enjoyable. But based on the TV industry’s history of getting new technology going, I have my reservations about how quickly it’ll catch on.