The New U2 CD--It’s Eco-Correct

For the last few months, the PolyGram Label Group (PLG) has been quietly wrestling with a potentially serious problem. One of its most respected superstar bands, U2 (which records for PolyGram-owned Island Records), had publicly voiced its opposition to the CD long-box package--and promised its fans that its new album would not be released with a long-box format.

PolyGram’s dilemma was obvious. It couldn’t force the band to put its album out in a long box. But each of the three environmentally correct alternatives--a shrink-wrapped jewel box, an Eco-Pak and a Digi-Trak package--had drawbacks. In the midst of a heated competition with rival labels, all eager to establish their package as the most suitable CD eco-alternative, PolyGram has been pushing the jewel-box format (the hard plastic case most CDs are enclosed in).

But retail store owners have loudly opposed the jewel-box only package, contending that it encourages theft and can’t be displayed properly in stores. (Geffen Records, which released its Peter Gabriel hits package in a jewel-box format last Christmas, encountered fierce retail resistance.) But PolyGram was also loath to use the Eco-Pak, which is being touted by its arch-rival, the Warner Music Group.

PolyGram’s inventive solution? When U2’s album, “Achtung Baby,” hits the stores sometime in November, it will come in two eco-friendly packages: the jewel box and the Digi-Trak (which features long-box size cardboard, which, once its shrink-wrap and two plastic struts are removed, folds around the CD).

PolyGram knew Digi-Trak was a viable format--it had already won acceptance in the marketplace, having been used on recent releases by Sting and Bonnie Raitt. But would retailers ever take any U2 jewel-box packages?

PolyGram shrewdly decided to give them an incentive. Any store that orders the jewel-box format receives a healthy wholesale-price discount.

“We believe the jewel box is the purest form of environmentally friendly CD package--and it is less expensive to manufacture than Digi-Trak and the other systems,” says PLG vice president of communications Dennis Fine. “So we decided to pass our savings along to the retailers, in the form of a discount, as an added incentive for them to order the jewel box.”

Fine would not say how much PolyGram saves, but industry insiders say the label could offer retailers savings of anywhere from 35 to 65 cents per CD. “We’d like to see the stores pass that savings along to the consumer,” adds Fine in a burst of optimism. “But we have no control over that.”

Judging from the initial retail reaction, PolyGram had better be printing up a lot of Digi-Trak packages. “If you were to ask for my prediction, I’d say the Digi-Trak will outsell the jewel box by a landslide,” says Russ Solomon, head of the prestigious Tower Records chain, one of the few retail outlets to exhibit any enthusiasm for CD long-box alternatives.

“I doubt if we’d ever order the jewel box--it creates too many problems with theft and fixture conversions. If PolyGram were to have any success with that package, they’d just get the idea they could ram it down our throats. Still, I like the idea. This way, PolyGram and other labels will have a true test of retailer enthusiasm for the jewel box.”

It’s no wonder environmental activists are frustrated by the glacial pace of current industry moves to dump the long box. Industry lobbyists are still trying to defeat a California legislative bill that would outlaw the box by 1993, saying they oppose a deadline.

But activists view the PolyGram action as a positive step. With the label planning an initial release of up to 1 million U2 CDs and cassettes, it would be a major test of retail interest in alternative packaging formats.

But it begs the question: If PolyGram is committed to eco-friendly CD packages, why isn’t it getting rid of the long box entirely--or at least experimenting with alternative packages with more artists?

“We first have to see how this plays out,” Fine says. “We know there’s still a lot of resistance among retailers. So instead of saying, ‘If you don’t take a jewel box, you can’t sell the record,’ we’re giving them an option. If it works, then maybe we can offer more alternatives to the long box. We just have to take it one step at a time.”