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Antitrust Law Aims at Apple

A new bill was approved today in France that could force Apple to share previously protected technology in order to open the market. Currently, Apple products are only compatible with one another, meaning that if a user buys a song on Apple’s music service iTunes, it can only be played on an Apple iPod. Since its inception, Apple has been able to thwart competition and dominate the online music market partially because of this technology. The iPod accounts for two out of every three portable music devices on the market, a fact obvious to anyone who takes public transportation amongst swarms of white-earphone wearers.

If this French law is adopted, it could effectively weaken Apple's global dominance. Even if the law doesn't pass, it should cause a commotion among users, all of whom would rather have the ability to share their music with more playing devices. Undoubtedly, the media will latch on to the story, opening Apple up to scrutiny for being user unfriendly.

In the long run, Apple may have no choice but to share the secrets of their format. By choosing to keep their designs compatible only with other Mac products, users likely will perceive Apple as a bully, a similar image problem facing computer conglomerate Microsoft. Because Apple’s entire brand is aimed at a youth-dominated audience, it is too image-conscious to become alienated from its users. But unless Apple can brush this growing commotion under the rug, Apple's digital player dominance likely will be harmed.

Posted by on 03/21/06 at 4:13 PM | E-mail | Print | Digg this | de.licio.us



Comments

So...Microsoft monopoly is OK, but Apple's technology is not OK? I presume this is because Windows folks don't want to have to buy iPods to use the clearly superior iTunes interface (which is available for Windows users).

The fact that the RAIA wants Apple to reveal its technology is telling. Apple is alone in letting you do what you want with your music after you buy it. You don't have to have subscription, you can burn it, and you can authorize up to 5 machines to play it. You can only burn a certain number of CDs before it will cut off that feature. The RAIA, true to form, wants to retain rights in your music after you purchase it, so Apple's model, which actually gives the used control, is not a good thing in their opinion. These are the same geniuses who opposed CD burners, online music, streaming audio, etc. a

In short, it is very advanced technology, good enough so the recording labels were willing to give it a shot with iTunes, which has proven successful. It seems odd to think that Apple would alienate its listeners when the only people complaining are the RAIA, Windows developers, and makers of inferior products. At least Apple doesn't force you to use Safari and other Apple stuff when you buy an iPod.

Posted by: abjectfunk on 03/22/06 at 11:57 AM

Apple will just close iTunes France if they ratify their law.

The iTunes music store exists for one purpose and one purpose only; to provide content and drive iPod sales. Nothing more. It's a loss leader. Apple makes little to no money on the music store. They make 110% or more markup on iPods.

Apple is a hardware company. Not a music company, not a software company. They sell computers and iPods. Everything else they produce serves to sell more computers and iPods.

So "yes" the music store songs only play on iPods. That's the intention. iPods are the "main" product and end users can put any type of music they want on them, however the iTunes music store will only sell songs playable for iPods. If you want to move those songs to some other device or medium you'll have to burn them out to CD format. And as far as buying music elsewhere and putting it on your iPod, you're free to do that. The iPod plays any MP3, AAC and AIFF file. However if you want to buy a song at the iTunes music store you can only play it on iTunes or an iPod or burn it out to a CD. And most of that is because of the RIAA, but it has worked marvelously in Apple's favor.

And that, in my opinion, that's perfectly fair.

Another thing that seems to never get mentioned in articles that say Apple has a monopoly on the online music business is that their offering is the best and there really aren't any better mousetraps. There's plenty of choices, it's just the others suck and Apple is the only one to get it right.

Posted by: Adam on 03/22/06 at 12:57 PM

This has all ways been the Apple way, and it cost them their dominance in the PC market, and more importantly, led to led hegemony of Microshit. It appears to be, at best, a short term gain over long term success thing. That has led to the company's sporadic performance over the decades in spite of obviously far superior technology.

Posted by: El Guapo on 03/23/06 at 9:48 AM

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