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Media (Apple) Media Businesses Government The Courts Apple News

Virgin Accuses Apple of Abusing Monopoly 394

Posted by michael from the turnabout-on-fairplay dept.
worm eater writes "The Register reports that VirginMega (Virgin Group's online music venture in France) is asking the French antitrust authorities to force Apple to license the FairPlay DRM. If France agrees with Virgin, will this be a blessing in disguise for Apple, making their DRM format the defacto standard, or will it be the downfall of the mighty iTunes Music Store?"
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Virgin Accuses Apple of Abusing Monopoly More

Virgin Accuses Apple of Abusing Monopoly

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  • This Raises An Excellent Question (Score:5, Interesting)

    by ackthpt ( 218170 ) * on Friday August 06, 2004 @01:34PM (#9900648) Homepage Journal
    If France agrees with Virgin, will this be a blessing in disguise for Apple, making their DRM format the defacto standard, or will it be the downfall of the mighty iTunes Music Store?"

    This raises and excellent question: Is Apple a:

    A) Technology (I.P.) Company
    or

    B) Hardware Company
    or

    C) Service Company

    Apple started as A & B and has dabbled in C, but IMS is solidy B & C. With their deals with Motorola (iPod tech in phones) and HP (own brand of iPod) they further A & C. If FairPlay becomes the defacto standard this places them squarely in the A camp again, which actually benefits Motorola and HP, among others who make hardware for them. Will Apple ever allow the Mac line to be made outside the company again, as it was in the Jean Louis Gassée days?

    While it all looks rosy for Apple, I can plainly see now how both Sony and Microsoft want to plough into this market, so they can get it all wrong, make people mad (ATRAC3? I thought it said 8 Track!) (my mPod has been 0wn3d!) and lose lots of money.

    • Re:This Raises An Excellent Question (Score:5, Insightful)

      by Anonymous Coward on Friday August 06, 2004 @01:38PM (#9900689)
      In this case, Apple is C). And, it's very very hard to say they have a 'monopoly' position, especially coming from a RECORD LABEL.

      If said RECORD LABEL wants the monopoly to end, they should maybe consider the (literally) hundreds of companies willing to get into the online music distribution business. After all, a RECORD LABEL would have the power to license songs to any other business they choose.

      This is absurd. If Apple has a monopoly, it's because the RECORD LABELS gave it to them. This is called playing both sides against the middle.

    • Re:This Raises An Excellent Question (Score:5, Interesting)

      by mblase ( 200735 ) on Friday August 06, 2004 @02:05PM (#9901016)
      Will Apple ever allow the Mac line to be made outside the company again, as it was in the Jean Louis Gassée days?

      When Apple licensed clones of their computers, it was intended to broaden the MacOS userbase. What happened instead was the MacOS userbase remained the same size, and Apple lost money to the clonemakers. Thus they soon rescinded the licenses and went back to doing what they always did.

      Doubtless this is part of the reason Apple's reluctant to license FairPlay. As long as they control both it and the iPod hardware, they can keep the iPod/iTunes experience Insanely Great(TM) and make more money to boot. But until the iPod and iTMS actually reach monopoly levels of domination, licensing FairPlay would just decrease the quality of that experience without increasing Apple's marketshare.

      • Re:This Raises An Excellent Question (Score:5, Interesting)

        by harlows_monkeys ( 106428 ) on Friday August 06, 2004 @02:28PM (#9901302) Homepage
        When Apple licensed clones of their computers, it was intended to broaden the MacOS userbase. What happened instead was the MacOS userbase remained the same size, and Apple lost money to the clonemakers

        Indeed, and the reason for this is that the cloners were very limited in what they were allowed to do. They weren't allowed to design their own motherboards, for example, but rather had to buy them from Apple. The rest of their design had to be approved by Apple.

        So it is not surprising they failed to grow the Mac userbase, since Apple would only let them produce machines that were essentially exactly the same as Apple's Macs. One of the cloners (Power Computing, I believe) showed off at trade shows a couple prototypes, including a cool laptop back when Apple didn't have any cool PPC laptops, that would have taken the Mac to new markets, and begged Apple to allow them to sell them, but Apple said no.

        • Actually, the major problem was that the clone makers (particularly PowerComputing) were starting to produce better hardware at lower prices than Apple could offer. Everyone jumped ship from Apple to PowerComputing due to the lower prices and higher-quality hardware.

          To this day, I still regard the Power Tower Pro as the best Mac ever produced.

        • That is to say... (Score:5, Interesting)

          by FredFnord ( 635797 ) on Friday August 06, 2004 @06:32PM (#9904148)
          Indeed, and the reason for this is that the cloners were very limited in what they were allowed to do. They weren't allowed to design their own motherboards, for example, but rather had to buy them from Apple.
          First: that's misleading. They bought motherboard DESIGNS from Apple, not motherboards.

          Second: let's just look at this for a second. One of the StarMax machines included a custom-made PCI card with ethernet and something else (video? SCSI?) on it. The drivers were from Motorola. When the next version of the Mac OS came out, the card simply stopped working because of the way they'd written the drivers. Apple was called over the next week by hundreds of irate StarMax owners.

          But I'm sure that if they had just been able to design their own motherboards, everything would have just worked fine and there wouldn't have been any problems with compatibility or anything.

          As for the idea that the PowerTowers were the end-all and be-all of Mac-hood, only two things to say. One: they were cheaply made. Things broke. Hardware failed. The case was a generic PC case with flimsy drive-bay doors with plastic fittings that broke off under the slightest bit of pressure. The actual basic design was nice, but the execution *sucked*. And two, especially at that year's MacWorld Expo, PowerComputing sold significantly below cost, because they wanted to entice as many people away from buying a high-end Mac and into their camp. When Apple had really hired people on to cover the low-end while they tried to get the high-end business. Now, you can decide that this was a slimy thing for Apple to do, to try to get someone to shore up their weaknesses rather than steal their best customers. And that's a valid point of view, I suppose. But when it turned around and Apple saw a whole lot of lost sales to people who otherwise would have definitely been buying the highest-end Mac kit, they got miffed.

          I would've too. And having worked on a number of Mac clones back then, as a techie, I have to say that none of them were engineered even as well as the PM8500. Which in and of itself was one of the most bone-headed piece of engineering as I have ever seen in all my days.

          But at least it was STURDY bone-headed engineering.

          -fred

      • Re:This Raises An Excellent Question (Score:4, Insightful)

        by allgood2 ( 226994 ) on Friday August 06, 2004 @05:43PM (#9903784)
        When Apple licensed clones of their computers, it was intended to broaden the MacOS userbase. What happened instead was the MacOS userbase remained the same size, and Apple lost money to the clonemakers. Thus they soon rescinded the licenses and went back to doing what they always did.


        I don't disagree with this statement. But I've started to feel that Apple IS missing an opportunity here. I see the question as two-fold: "Will licensing Fairplay lessen Apple's current dominance in the Music market? and Will licensing Fairplay seal AAC and Fairplay as the format and DRM standards for the current music wars?

        I don't believe that licensing Fairplay would lessen Apple's current dominance that much. The Mac OS license issue was a different ballgame. It seemed everyone but the high paid business people all agreed that it would sucker punch Apple sales. More importantly, it sucker punched hardware sales which are Apple's bread and butter. Unless you own the market or are a smalltime vendor there just is much money to be made in OS sales.

        But for iTMS the hardware is the iPod, and licensing Fairplay will ensure the iPods dominance as a MP3 player for years. I see this as a good thing. People will still use iTunes and iTMS because of the ease of use and tight integration with the iPod. Those who won't probably aren't using iTMS currently, but also DON'T have an iPod. If they purchased an iPod, the likelihood is that they would eventually start purchasing from iTMS. It means Apple has to keep on its toes about the music store features, functions, and all around user experience, but the iPod would dominate for at least another 2-5yrs.

        While this first issue is VERY IMPORTANT. I think the second question is JUST AS, if not MORE SO important for Apple, especially at this juncture.

        Will licensing Fairplay seal AAC and Fairplay as the format and DRM standards for the current music wars?

        Licensing Fairplay before Microsoft hits the music scene would be good for Apple, because currently a lot of people are looking for Microsoft and businesses using Microsoft technologies to save them from Apple. Who knows what the likelihood of success of a Microsoft music store would be? I don't. But I can say, that even if it failed completely (less likely), it still gives Microsoft the ability to promote Windows Media DRM as the de-facto delivery standard, which does nothing but contribute to the future decline of iPod sales.

        Imagine if RealNetworks, Napster, and OD2 started offering iPod compatible offerings. That would push iPod sales. But also satisfy a number of people's needs for compatibility. Many of those people who want Apple to support WMV would just shut-up, because they don't care about wmv, they care about playing their music on their mp3 player. (It wouldn't satisfy the .oog user, but...)

        I think the time is coming for Apple to license Fairplay. I don't want .wmv to the DRM standard, and it has the potential.
    • JLG left apple in 1990. Apple allowed officially-sanctioned clones for the first time in 1995, unless you count the DynaMac, which salvaged parts from existing Macs.

    • Re:This Raises An Excellent Question (Score:5, Insightful)

      by macdaddy ( 38372 ) on Friday August 06, 2004 @02:56PM (#9901659) Homepage Journal
      Will Apple ever allow the Mac line to be made outside the company again, as it was in the Jean Louis Gassée days?

      No, they never will. At least they won't if they value their company, their products, their income, and the people who support all that. The Apple clone market was a resounding fuckup. That idiot CEO should be flogged for what he did. He caused an absolute nightmare for support. People didn't call Epson or Umax for tech support. Oh no. They saw the Apple logo and called Apple for support. The Umax and Epson clones were the worst of the lot. At an Apple Service Center I worked at we had racks of dead Epson and Umax clones. They couldn't be fixed. The companies refused to honor the warranties. They were POSs. DayStar and Power Computing did a pretty damned good job of making clones (especially the SMP DayStar boxes) but that still didn't fix the support issue. The Radius machines were also junk. The clone "experiment" was far and away a horrible fuckup that we all should hope never happens again.

      And it wasn't Jean that licensed the OS and CHRP platform to the cloners. It was Spindler.

    • Re:This Raises An Excellent Question (Score:5, Funny)

      by Hatta ( 162192 ) on Friday August 06, 2004 @03:22PM (#9902021) Journal
      Apple started as A & B and has dabbled in C, but IMS is solidy B & C.

      Dunno, FairPlay seems more like S&M to me.
    • virgin music has released product before. it is no longer a virgin. apple should countersue to have them change their name to "slut entertainment" since they are obviously selling their wares for money.

      that'll teach 'em.

  • Am I missing something? (Score:5, Interesting)

    by r_glen ( 679664 ) on Friday August 06, 2004 @01:35PM (#9900659)
    ...will this be a blessing in disguise for Apple, making their DRM format the defacto standard

    How exactly would this be a blessing in disguise? Wouldn't it just open the door to more iTunes-compatible players to compete with? Or does Apple stand to make a pretty penny by licensing FairPlay to the world?

    • Re:Am I missing something? (Score:5, Insightful)

      by 2nd Post! ( 213333 ) <gundbear.pacbell@net> on Friday August 06, 2004 @01:39PM (#9900699) Homepage
      Well, it depends on where the market lies...

      Is it in players?
      Is it in content?
      Is it in distribution?

      See, with players they're already licensing the iPod to HP and Motorola.
      In content they already have indies as well as major bands.
      In distribution they have iTMS for Windows, Mac, and soon Motorola.

      If they license Fairplay, that means other people's content is allowed on the network; it also means other people can create their own networks, and it means other people can create their own players!

      However if Apple licenses FP in such a way to generate network effects... I would expect Apple to license FP for other players, and maintain control over content and distribution!

      • Re:Am I missing something? (Score:4, Informative)

        by wulfhound ( 614369 ) on Friday August 06, 2004 @01:44PM (#9900750)
        Players will be a profitless commodity within two years (as soon as 2GB flash chips are cheap and readily available, you can forget about the engineering challenges that shoehorning an HD in to a small, elegant box brings). Whether or not there is any money to be made from the other two depends on whether or not the DRM model wins out against both genuinely-free and illegaly-copied music.
      • Well, it has always been and will always be players... I chatted with the MTV CEO about why they don't enter the music distribution business, considering that they already have the relationships in place. And then he brought me down to earth. How much do you think does apple earn from selling one song? About 20-30 cents. The rest goes to music companies and artists. So how many songs do you have to sell in order to make 50 million dollars, an amount which is fairly trivial actually for these companies. The
    • Seems like everyone keeps ranting on how "Real Networks hacking DRM" is good for apple, or how apple should open source their DRM, or how they should licence the technology to competitors.

      To me it looks like they're making money, and maybe people should stop ranting about what Apple should do and look at what's working.

    • Re:Am I missing something? (Score:5, Insightful)

      by proj_2501 ( 78149 ) <mkb@ele.uri.edu> on Friday August 06, 2004 @01:44PM (#9900752) Journal
      apple might be having some trepidation about cloning.

      jobs is probably very aware that mac clones nearly killed apple. that's why he killed them when he was brought back on board.

      however, with the iPod having lots more share of its market than the macintosh, i think apple has less to worry about if they can get a decent sum from fairplay.

      if they can't make a lot of money by licensing fairplay, they do have a lot to lose. itms won't be selling to ipods exclusively anymore, and itms doesn't have the same high margin as the ipod.
    • Or does Apple stand to make a pretty penny by licensing FairPlay to the world?

      Think back about two decades. Apple had come cool tech and wanted to keep it all for themselves. Microsoft had recently acquired some tech that wasn't nearly as cool or groundbreaking as Apple's BUT they let the other children play with it.

      Look at where those two companies are today. Both are going strong, but the one who shared with the other children is in a much stronger position.

      LK

  • Holy! (Score:5, Funny)

    by darth_MALL ( 657218 ) on Friday August 06, 2004 @01:35PM (#9900661)
    Virgins!?! Apples!?!? It's all sounding very biblical to me. Leave it up to the Big Man to decide.

  • IE-only shoppe (Score:5, Informative)

    by jez9999 ( 618189 ) on Friday August 06, 2004 @01:38PM (#9900686) Homepage Journal
    Le navigateur que vous utlisez ne vous permet de surfer sur ce site.
    Pour surfer sur ce site nous vous recommandons d'utiliser Internet Explorer comme navigateur.

    Looks like they don't want you using anything but IE to access their rather shitty site. Going in with IE, I can tell you it doesn't seem like there are any Windows-only features there that would justify not accepting other browsers; just doubtless lazy web design. Good example of a site to quote when somebody asks you for a major site that is incompatible with non-IE browsers.

    • ...translation (Score:3, Insightful)

      by morcheeba ( 260908 ) *
      so, they're saying some monopolies are good because it lets their webmonkeys design for only one platform?

    • Re:IE-only shoppe (Score:5, Insightful)

      by Yaztromo ( 655250 ) on Friday August 06, 2004 @02:48PM (#9901563) Homepage Journal

      The site apparently isn't Windows only -- on a Mac running FireFox and Safari, I get:

      Pour surfer sur ce site depuis un Mac vous devez utiliser Internet Explorer 5.2 et supérieur, comme navigateur.

      IE has to be one of the absolute worst browsers available for Mac OS X. It's slow, looks terrible, and was the very first thing I deleted from my PowerBook.

      The truly galling part is they recommend I use IE 5.2 or better. And I am -- FireFox is better.

      So let me get this straight. They don't support Apple Mac OS X users using the default OS X browser (Safari), but they want access to Apple's DRM technology Apple originally created to service the same people who use OS X and Safari. Uh-huh.

      Methinks VirginMega needs to fix their own support for Apple before they worry about Apple supporting them.

      Yaz.

  • iPod needs WMA (Score:3, Interesting)

    by MysticalMatt517 ( 772389 ) on Friday August 06, 2004 @01:40PM (#9900707) Homepage
    Truthfully I don't see the need for Apple to license their FairPlay technology as much as I see the iPod needing to support WMA. Apple has already stated that they don't make money off iTMS, but off iPod sales generated from iTMS interest. Consequently making the iPod able to play just about anything would help further increase their gravy. Most people will still end up using iTMS anyway.
    • If everything you say is true, then WMA is pointless.

      Especially since iTunes will transcode unprotected WMA... Not the BEST solution, but it is a solution.

    • Re:iPod needs WMA (Score:3, Insightful)

      by weez75 ( 34298 )
      Supporting WMA isn't in Apple's best interest. Controlling the format means controlling royalties. If Apple licenses FairPlay they make money from those who use it. If Apple supports WMA then they make money only on iPods and not their intellectual capital that is FairPlay. You suggest supporting WMA will sell more iPods which I counter because WMA doesn't really help sell any music devices today. The standard is MP3 which the iPod already supports.

    • Re:iPod needs WMA (Score:3, Insightful)

      by Yaztromo ( 655250 )

      Now what benifit would Apple see by helping Microsoft gain total dominance in the music format wars?

      We're in the very fortunate position right now where the dominant music format has no digital rights management built into it (MP3), and where Apple's own format has fairly low restriction DRM built into it, and where there are other formats (ATRAC3, WMA) in competition.

      But give Microsoft too much sway by making their format the ubequitous one and they'll be the ones in control. And we've already seen what

  • Heh (Score:3, Funny)

    by Anonymous Crowhead ( 577505 ) on Friday August 06, 2004 @01:40PM (#9900709)
    - Plateforme Windows (98 SE et supérieur)

  • Wouldn't this be good for users too? (Score:3, Insightful)

    by rokzy ( 687636 ) on Friday August 06, 2004 @01:40PM (#9900713)
    isn't Apple's DRM the sensible one apart from being WinXP/2000 (and Macs) only?

  • What is Apple dominant in? (Score:5, Insightful)

    by SuperKendall ( 25149 ) * on Friday August 06, 2004 @01:41PM (#9900716)
    Virgin claims that Apple is abusing a "dominant" position by not licensing its own DRM.

    But "dominant" is not really applcable yet. Are they dominant in music sales overall? No way. Are they dominant in being able to play music you buy online? Not even that is true, since the percentage of PC's is so much larger than Macs.

    Perhaps at some distant point, when online music sales erally exceed physical CD sales (if ever?) then Apple might be called "dominant". In this case it's like a black hole calling the kettle black.

    There is even an out if they REALLY want to sell music that can play on an iPod - MP3. Just because that format lacks technological features they would like, does that really give them cause to proclaim Apple is a monopoly that should be forced to share?

    It will be interesting to see what the courts make of it.

    • Re:What is Apple dominant in? (Score:5, Insightful)

      by ElForesto ( 763160 ) <elforestoNO@SPAMgmail.com> on Friday August 06, 2004 @01:50PM (#9900840) Homepage

      You're right on track. If I start a company in a new industry and instantly get 100% market share, does that give new entrants the right to sue me for not licensing my technology? Hell no! Virgin doesn't quite seem to get that just because Apple is the most popular, it hasn't done anything really nasty/illegal to be there.

      Sounds like Virgin doesn't really want to compete in this market. It just wants a big chunk of it handed to them.

  • Make it the standard (Score:5, Insightful)

    by 5n3ak3rp1mp ( 305814 ) on Friday August 06, 2004 @01:41PM (#9900719) Homepage
    because PlayFair already cracked it and will allow us to unlock what we've purchased. The main site's taken down, but you can just google "playfair-0.5.0" or the like.

    Or just burn to CD and re-encode, but who wants to waste cd's and time doing that?

    There are also already plugins for Winamp that will play both .m4a as well as .m4p files (as long as you have iTunes installed)
    • I think you meant to say: HYMN [hymn-project.org].

    • Re:Make it the standard (Score:3, Interesting)

      by rokzy ( 687636 )
      couldn't you burn to a virtual CD drive (.iso) and rip back?

      semi-OT: I got rid of my (legal) mp3s recently cos all they did was make backups a pain and I like to encode in FLAC via Grip now, and play back with XMMS and CrossFade. Having all my CDs as mp3 seemed great until I realised I really only listen to a couple on a regular basis.

  • What do they whine for? (Score:3, Insightful)

    by Kosi ( 589267 ) on Friday August 06, 2004 @01:42PM (#9900725)
    If they sold normal MP3 or AAC files, they would play perfectly on the iPod, and the customers were more pleased. So their claim that they could not sell songs "for the iPod" is absolutely ridiculous!

  • It might not change much... (Score:5, Interesting)

    by brainstyle ( 752879 ) on Friday August 06, 2004 @01:42PM (#9900729)

    ...at least for now. Unless Virgin can offer a music buying experience that works as seamlessly with the iPod as Apple's - since it's clear that they're trying to sell their tunes to iPod owners - then they'll still be missing the point. I suspect what most people dig most about the iTunes store is integration and ease of use. They aren't terribly concerned about file formats and rights managements schemes. Sure, some are - plenty here on Slashdot, for instance - but I doubt the average person is too concerned by that.

    Plus, Apple's the cool music company right now. I just saw someone on the street this morning walking with her nice custom-made iPod purse which still clearly had an Apple logo on it, so you knew it was an iPod in there, and that she dug Apple. I suspect she'd use the iTunes store (except I'm in Canada, alas).

    But then, I may be underestimating the tech literacy of the average person. I'd be glad if that were the case.

  • Pay?!? (Score:3, Funny)

    by eviltypeguy ( 521224 ) on Friday August 06, 2004 @01:43PM (#9900742)
    Burns: Excellent! My secret plan to "reluctantly" license FairPlay DRM is coming along quite nicely, don't you think Smithers?

    Smithers: But sir, won't we lose our exclusivity?

    Burns: Smithers, you bumbling idiot. They may be able to license our DRM, but they'll pay, ooohh, yes, they'll pay...
  • If they opened up the format sure they will have to deal with competion but by having more devices that play it will increase demand for ITMS. By having other stores selling FairPlay files it will increase demand for the ipod. Seems like a win win situation. Surely they can compete on both the quality of the hardware and the store.

    • Re:I don't get Apple's reluctance to do this (Score:4, Interesting)

      by Bricklets ( 703061 ) on Friday August 06, 2004 @09:05PM (#9905477)
      Same thing with the iPods. People didn't understand before why Apple made iPods exclusive to Mac users. They were griping Apple for not realizing iPod's full potential. We all know how that's turning out. Apple bided its time and came out with a PC-compatible model when it was ready to take on the market.

      Same can be said about iTunes. Just because Apple isn't opening iTMS today doesn't mean they don't have plans to do so in the near future. Everyone just needs to chill out a bit and be patient. Apple is probably biding their time again and tweaking iTunes into a better service until they're ready to take on the market.

  • Bad thing. (Score:3, Interesting)

    by ActionPlant ( 721843 ) on Friday August 06, 2004 @01:47PM (#9900790) Homepage
    In the earlier days of the iTunes music store, Apple itself reported very meager earnings indeed. It's long been Apple's policy to charge less for software and more for hardware; if this were to happen, sure, the resulting surge in sales would probably be high, but would iPod sales take a hit? Who knows. It seemed to me that Apple introduced iTunes and the music store on both Apple and PC platforms in order to help drive up iPod sales, from which it makes a tidy bundle. It may be pure speculation, but one could probably assume that doing this would probably hurt iPod sales, and the company in the process.

  • hm... (Score:3, Insightful)

    by MORTAR_COMBAT! ( 589963 ) on Friday August 06, 2004 @01:47PM (#9900792)
    methinks Virgin needs to go look up the definition of a monopoly: "Exclusive control by one group of the means of producing or selling a commodity or service."

    There are a dozen online music stores. There are several dozens of portable music players. There are a half-dozen DRM solutions. Apple does not have anything even closely resembling a monopoly in any of these areas.
  • Pot [slashdot.org], meet kettle.

  • Apple caves (Score:4, Insightful)

    by Elwood P Dowd ( 16933 ) <judgmentalist@gmail.com> on Friday August 06, 2004 @01:49PM (#9900837) Journal
    submits to licensing FairPlay decoder for $400 per device and the encoder for $2,000,000 per song.

    Seriously, though, what's preventing Virgin from selling songs that play on an iPod? The copyright holders. Is that Apple's fault?

  • Oh, the irony (Score:4, Funny)

    by Weaselmancer ( 533834 ) on Friday August 06, 2004 @01:50PM (#9900845)

    ...of a music company accusing anyone of being an unfair monopoly. And, just to double your irony goodness...accusing Apple.

  • Bur Apple doesn't *own* FairPlay! (Score:4, Informative)

    by sh00z ( 206503 ) <sh00z.yahoo@com> on Friday August 06, 2004 @01:52PM (#9900875) Journal
    The article ignores the fact that Apple has licensed FairPlay from Veridisc [64.244.235.240]. It was not created in-house. Now, they may have negotiated themselves an exclusive license for some period of time, and more power to 'em, but this is NOT "Apple imposing an Apple-proprietary standard" as some would have us believe.

    • wow... that is interesting... I wish I had mod point for you but it looks like other will take care of that.

      Im very intersted in this. It seems odd that people would keep bitching at apple to open their standard when it isnt even theirs to open... you would think that one of these companies would have noticed that by now.

    • Re:Bur Apple doesn't *own* FairPlay! (Score:5, Informative)

      by thatguywhoiam ( 524290 ) on Friday August 06, 2004 @04:12PM (#9902709)
      The article ignores the fact that Apple has licensed FairPlay from Veridisc [64.244.235.240]. It was not created in-house. Now, they may have negotiated themselves an exclusive license for some period of time, and more power to 'em, but this is NOT "Apple imposing an Apple-proprietary standard" as some would have us believe.

      T'would be an excellent point, sir, were it only true.

      VeriDisc's FairPlay and Apple's FairPlay are not the same thing. Apple's version was indeed developed in-house, as a custom QuickTime-compatible DRM wrapper.

      Why do you think Real is browbeating Apple these days over 'opening' the iPod, when they could have otherwise just gone to VeriDisc and bought a license?

  • Scope is way too narrow... (Score:5, Insightful)

    by sockonafish ( 228678 ) on Friday August 06, 2004 @01:56PM (#9900915)
    Apple has just as much as a monopoly on FairPlay as Nike has on Air Jordans. That is, they have a monopoly on a product, not a monopoly on the music player/music store market. By revenue, Apple has a 55 percent market share for mp3 players. By units, only 31 percent. [yahoo.com] I don't know how much of a market share iTunes has, but FairPlay songs are only able to be played on 31 percent of mp3 players. Good luck crying monopoly in court on a company whose market share isn't even close to a majority.

    They do have competitors, and those competitors are obliged to compete. If they can't, tough.

    • Actually... (Score:3, Interesting)

      by FredFnord ( 635797 )
      ...I don't know about that. French law only counts product sales in France. If Apple has a 95% market share in France, it has a monopoly in France, regardless of what is happening elsewhere. And that wouldn't surprise me as much as it might you, because the French have an eye for elegant hardware, and an unconcealed loathing for 'wanna-be' junk. It's just one of the traits that makes Americans hate them so much.

      So before you start spouting off on it not being a monopoly, let's see your numbers on Frenc

  • It's obvious (Score:3, Interesting)

    by hawkbug ( 94280 ) <psxNO@SPAMfimble.com> on Friday August 06, 2004 @01:59PM (#9900954) Homepage
    It's a blessing, and here's why. Earlier in the year Jobs said Apple makes no money off songs sold on iTunes, correct? Well, if he was telling the truth, Apple stands only to make money with the iPod sales. In which case, other online music stores selling music that works with the iPod could only benefit Apple. Unless somebody comes out with a device that holds as much as the iPod that also plays those type of files....

    • Re:It's obvious (Score:4, Informative)

      by Masker ( 25119 ) on Friday August 06, 2004 @04:26PM (#9902889)
      Actually, in the last quarter [com.com], the iTMS did post a small profit.

      Also, the point isn't that FairPlay is driving sales of the iPod, but that Apple controls the total user experience of the iPod. It controls:

      1) The UI & hardware of the iPod
      2) The loading of music, playlist creation, etc. on the computer you use to interface with the iPod via iTunes
      3) The online purchasing of music for use on your iPod

      Apple, as they usually do, wants to have total control over all of those factors. It's the same damned thing they do with their OS & Hardware combo and their retail experience. They want to control everything, not because they're control freaks, but because "if you want it done right, do it yourself".

  • This Is Nuts. (Score:5, Insightful)

    by MBCook ( 132727 ) <foobarsoft@foobarsoft.com> on Friday August 06, 2004 @02:00PM (#9900966) Homepage
    This is nuts. First of all Apple is not a monopoly, their player is just head and shoulder above everyone else. As for the argument they are preventing competition by not licensing FairPlay there are two points. First is that there are tons of other players on the market and if you include all the flash players sold over the years the iPod isn't the majority of sales (I don't think). Second of all they CAN SELL MUSIC FOR THE iPOD. They have to use this magical format that the iPod plays. What was it called? MP3. They can sell MP3s. You can't force Apple to open it's product because they don't want to use the dominant format on the market to sell their music.

    Virgin is just plain wrong. Forcing Apple to open FairPlay would be a miscarige of justice, there is no good reason to do it other than to stick it to Apple because other companies are mad they aren't as successfull.

    • Re:This Is Nuts. (Score:3, Interesting)

      by SilentChris ( 452960 )
      Virgin Manager: "Say Bill, I see those iPod things everywhere. I want us to get music onto them."
      Virgin Tech Guy: "We can't do that sir."
      Virgin Manager: "Why not?"
      Virgin Tech Guy: "The only protected format that runs on them is Apple's Fairplay AAC."
      Virgin Manager: "I thought they were MP3 players".
      Virgin Tech Guy: "If we sell MP3's, people can copy them wherever they like".
      Virgin Manager: "Screw that. Apple's format is the only protected one on iPod?"
      Virgin Tech Guy: "Yup."
      Virgin Manager: "So they have a

    • Re:This Is Nuts. (Score:4, Insightful)

      by SuiteSisterMary ( 123932 ) <slebrunNO@SPAMgmail.com> on Friday August 06, 2004 @03:04PM (#9901748) Journal

      Can I buy a portable player that isn't an iPod that can play the DRM'd iTunes AAC files?

      No?

      Well, then, sounds like they're using their strength in one market to sell product in another.

      • Re:This Is Nuts. (Score:3, Insightful)

        by n8_f ( 85799 )
        So? Unless a company has a monopoly and is abusing its monopoly in one market to increase its share in another market, it is irrelevant. Neither iTMS nor the iPod are monopolies in their respective markets (they are dominant, but that isn't the same), so what is the problem? By your logic, you would force Apple to port OS X to PCs, because they are using their OS to force people to buy Macs. "Is there another computer that can run OS X? Well, then, sounds like they're using their strength in one market

  • A double-edged sword.. (Score:3, Funny)

    by wfberg ( 24378 ) on Friday August 06, 2004 @02:06PM (#9901028)
    This just shows that DRM, while being so vilely derided on slashdot, can actually be used for evil, as well as for evil.

  • If you can't compete... (Score:3, Funny)

    by b-baggins ( 610215 ) on Friday August 06, 2004 @02:17PM (#9901133) Journal
    ...litigate!

  • Apple's Digital Hub (Score:4, Interesting)

    by ztirffritz ( 754606 ) on Friday August 06, 2004 @02:37PM (#9901406)
    Apple is not planning on living off of the iPod for the long term goal. They are planning on building the hub of your future digital lifestyle. Digital music, movies, communication, etc. DRM is key to that goal. Apple is just funding this project with the iPod. Eventually iTMS will will either dry up or redefine the music distribution model. I think the latter. Apple will develop an iMovie (iTV?) store as well. With Airport express or a similar product they'll be able to stream files to your entertainment center. Eventually your computer will become part of your entertainment center. Who wants to pay for 24x7 Cable or satelite service if you can pay for just the progamming you want to see/hear? In the end, there will probably be Apple computers, Monitors, Amplifiers, speakers, and a multipurpose digital recorder for audio and video. Video will be pay per view while audio will be owned.

  • Not what I expected... (Score:3, Funny)

    by pyrrhonist ( 701154 ) on Friday August 06, 2004 @02:37PM (#9901410)
    Virgin Accuses Apple of Abusing Monopoly

    Considering the title, I was expecting something like this:

    CUPERTINO, CA (Reuters) -- A virgin was playing the Parker Bros. game with Steve Jobs, when he noticed the Apple CEO give himself an interest free loan. "That's not allowed under Monopoly version 3 rules", said the avid Slashdot reader, "You come to expect more from someone who plays a CEO in real life; it was clearly an abuse of the rules". Jobs, who was playing the banker in the game, could not be reached for comment. "I should have known when he insisted on being the car, leaving me with the damn boot", the virgin later lamented.

    Ok, I'll stop now.

  • Apple A Monopoly? (Score:3, Funny)

    by nurb432 ( 527695 ) on Friday August 06, 2004 @02:40PM (#9901447) Homepage Journal
    Thats funny..

  • by extension? (Score:5, Interesting)

    by crono_deus ( 796899 ) on Friday August 06, 2004 @02:46PM (#9901538)
    Hrm.
    Ok, so, say for instance, a compay makes software that runs on only one platform. The software is an incredible hit and fuels the sale of this platform. Other companies want this killer app on their platform. Do they have a right to force the original company to make the software for their platforms?

    Draw your own conclusions, but my opinion is thusly: hells freakin' no. Say my company makes software for Apple hardware (and by extension OSX) and it's so freakin' incredible that everyone goes out and buys OSX. No on, but _no one_ has the right to force me to port my app to their platform. It's _my_ software.

    I see a similar thing here: Apple has this "app" (AAC wrapped in FairPlay) and it works on the iPod. Apple hasn't stopped anyone from writing other "apps" for the iPod (within the specs of the iPod, of course, just like you'd have to write hardware specific stuff for PPC), but it shouldn't be forced to license that "app" to anyone else.
    Now, it _may_ be really good for them to let other people use FairPlay, but I don't feel I have the information I need to make that call.

  • I must be missing something.? (Score:3, Informative)

    by nasor ( 690345 ) on Friday August 06, 2004 @02:53PM (#9901635)
    How is Virgin being hurt by their current inability to use the iTunes DRM system? Since the iPod can play any mp3 file no matter where you get it from, it shouldn't be interfering with Virgin's (or anyone else's) ability to sell people digital music to play on the iPod. Right?
    • Yes you are missing something, it's called DRM!
      the whole point of NOT using mp3s is to restrict people to when/where/how they can use their purchase.
      • " Yes you are missing something, it's called DRM! the whole point of NOT using mp3s is to restrict people to when/where/how they can use their purchase."

        Well I realize that, but I don't understand how Apple refusing to share their particular DRM scheme hurts Virgin in any way since you can play *any* mp3 on an iPod, no matter where you get it. So I don't understand how specifically Apple is hurting Virgin's business. I mean, Virgin can still start up an online music store to sell me music and I'll be ab
        • I don't think you realize what's going on here....
          Virgin (nor any other big lable) will not sell non-drm music.
          If their DRM music can't be played on the iPod they lose out on millions of potential customers.

  • VirginMega?!? (Score:5, Funny)

    by JBMcB ( 73720 ) on Friday August 06, 2004 @03:03PM (#9901740)
    I think it's funny that a company called VirginMega is suing a company for being a monopoly. "Globex MegaCorp PanGalactic Enterprises is being harmed by Frank's PC Haus monopoly on the computer service business in Saginaw, Michigan. We are suing!"

    I bet the French government will back Virgin just 'cause Apple's DRM wasn't programmed in French or something.

  • Future of My iTunes... (Score:3, Insightful)

    by endofoctober ( 660252 ) <<moc.deryasderfi> <ta> <eloc.kj>> on Friday August 06, 2004 @03:10PM (#9901842) Homepage
    "...or will it be the downfall of the mighty iTunes Music Store?
    Not wanting to purchase an iPod, I kinda already gave up on iTunes. Despite it being a nifty integrated player/store/library, iTunes chose a format I'm not willing to switch to, much less buy a player to play on. My CDs have been converted to the format of my choice, and I'm NOT cataloging 500+ CDs again.

    I bought about seven songs, then decided that the hassle factor (burning songs to CD, then converting to MP3 or OGG for my portable device) was too high. If they become the standard, then I'll give up completely on downloadable music, and stick to buying CDs from non-RIAA labels.

    Gotta go - my high horse has the munchies.

  • The answer is NEITHER (Score:5, Insightful)

    by nusratt ( 751548 ) on Friday August 06, 2004 @03:26PM (#9902071) Journal
    "will this be a blessing in disguise for Apple, making their DRM format the defacto standard, or will it be the downfall of the mighty iTunes Music Store?"

    What it WILL be, is a perfect reason for Virgin to buy up Real -- who recently reverse-engineered FairPlay -- as a new outlet for Virgin's catalogue, bypassing Apple.

  • Muddy the DRM waters till it goes away ... (Score:4, Interesting)

    by slapphappe ( 694246 ) on Friday August 06, 2004 @03:26PM (#9902081)
    In the interests of putting an end to encryption based DRM I'm quite happy that Virgin Records sues Apple Computer (although I think their case isn't strong) -- even though I don't want Virgin selling DRM'd files either. Similarly, while I don't think much of Real, I'm happy they've reverse engineered FairPlay.

    The bigger the DRM mess becomes, the less likely it is to survive.

    It's absolutely not right that we're buying file formats instead of content. Anything that muddies the DRM waters, as they currently exist, works for me.

  • A double edged sword (Score:4, Insightful)

    by cmirza ( 682040 ) on Friday August 06, 2004 @03:41PM (#9902291)
    If the FairPlay DRM is opened up for music stores, wouldn't also be possible for hardware manufacturers to then adopt it for their hardware? That would allow 3rd party devices to use iTunes Music Store and be one less advantage that the iPod would have.

  • What could have been... (Score:3, Funny)

    by MirgNave ( 710935 ) on Friday August 06, 2004 @04:10PM (#9902677)
    Man that headline would have been much cooler if Apple had chosen Cherry for its corporate name instead.

  • Here's the question I find interesting (Score:4, Funny)

    by mcc ( 14761 ) <amcclure@purdue.edu> on Friday August 06, 2004 @04:25PM (#9902873) Homepage
    What happens if Virgin drops the whole "Apple=monopoly" thing and instead chooses to simply license the Harmony hack from realplayer in order to get their music onto iPods?

  • I don't care if it is good for Apple... (Score:3, Insightful)

    by doneWithMyTattoo ( 647168 ) on Friday August 06, 2004 @04:36PM (#9903001)
    It would be good for me. FairPlay-AAC and WMA are the two DRM formats available. Microsoft seems to be licnesing out since I can buy home or car audo/vedio elecrtonics to play WMA files. But I can't buy any of that stuff to play FairPlay-AAC files. And I wish I could. Also that Vergin-whatever company has no angle on providing me with a FairPlay-AAC home/car audio device. They are just in it for settlement money. As for Apple, it would be good for them to choose their partnerships, not get forced to lincens to anyone who fills out the court order form. They should get their buddies, Phillips, to start making FairPlay-AAC compatible DVD and CD players.

  • Intellectual Property (Score:3, Insightful)

    by sybert ( 192766 ) on Friday August 06, 2004 @05:27PM (#9903626) Journal
    A French company want to take away an American company's inalienable right to private property, what a surprise. FairPlay is Apple's private intellectual property, which they can use as they see fit. If it is Apple's best interests to license their IP then it is up to Apple to make that decision. It is not up to government to nationalize anyone's property, intellectual or tangible.

  • Interface patents create natural monopolies (Score:4, Insightful)

    by MythoBeast ( 54294 ) on Friday August 06, 2004 @05:30PM (#9903660) Homepage Journal
    It was determined a long time ago that requiring someone to purchase a second item with a first item was a monopolistic tactic. IBM lost that one when they were requiring a service contract with their computers.

    Interface patents do the same thing. It allows a company on one side of that interface to monopolize the sale of the software or hardware on the other side of the interface.

    This comes up a lot, expecially when people attempt to use the DMCA to protect their right to do these things.

    Interfaces are essentially a language. It has already been tested in court that you can't patent a language, simply because you need to release it into the public domain for it to be useful. Interfaces are a little different - you don't have to release them into the public domain for them to be useful, but you do have to do so if you aren't attempting to hold a monopoly on both ends of its use.
    • Please, explain what you mean by first item and second item. Is the first item the iPod? But you're not required to purchase music from iTMS to use the iPod.

      Is the first item music from iTMS? But you do not need to purchase an iPod to play that music. Any computer with the free iTunes software installed will do.

      And lastly:

      Interfaces are essentially a language. It has already been tested in court that you can't patent a language, simply because you need to release it into the public domain for it to be u

  • The real question is... (Score:3, Insightful)

    by Warlock7 ( 531656 ) on Saturday August 07, 2004 @12:06AM (#9906574)
    Did they get turned away or did they not agree to the licensing offered by Apple in the first place? Motorola has a long-standing relationship with Apple and most likely agreed to an exclusive DRM license deal that Apple agreed with and allowed them to distribute. The long term goals of the iTMS and iPod appear to be getting the Fairplay DRM distributed to the masses without interference from some other competing DRM.

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