Locally, used CDs sell for more than this. Like literally: $12-15 seems to be the price-point for them. This article suggests that Universal Vivendi is undercutting this pricepoint:
"Our research shows that the sweet spot is to sell our records below $12.98," said Universal Music President Zach Horowitz. "We're confident that when we implement this we will get a dramatic and sustained increase."
I'm less concerned with how this will affect online piracy, and more concerned about the imminent death of the secondhand CD industry.