Universal Wants a Slice of Apple's iPod Pie 555
vought writes "According to a Reuters report, Universal is now taking the precendent set by Microsoft's Zune and moving to force Apple to include a royalty payment with each iPod.
In the words of Universal Music's Doug Morris, 'These devices are just repositories for stolen music, and they all know it. So it's time to get paid for it.' Does Microsoft's precedent mean the start of a slippery slope that will add a 'pirate tax' to every piece of hardware that touches digital music?"
To Doug Morris... (Score:5, Insightful)
In the regretful, embarrassing, yet immortal words of Dick Cheney...... " Go F$@% yourself ".
I personally take offense at the allegation that there is *any* stolen music on my iPod or any of my computers. All of my music has been purchased on CD or the iTunes Music store as it is on most of the peoples iPods and computers that I know of. Your allegation suggests that you actually do not know about your potential customers, their desires, technology or most disturbingly, the music industry itself. Apparently, you also don't seem to be able to understand that you need to out-compete the piracy industry by offering a quality product at a reasonable price and in a manner that is easy for people to pay for. Marketing 101 tells us that the way to make money is to create a product people want and then remove any barriers that will prevent people from *willingly* giving their money to you in exchange for those goods or services. The iTMS has shown you how it is done, yet you get in bed with Microsoft who apparently cannot design a device that will compete in the same arena with the iPod, then you force people to buy points that they can then exchange for music *and* you want a slice of the hardware market. If you want into that market, why not create your own hardware? To do anything else is leveraging your monopoly to extort money from another industry and the last time I checked, that behavior is illegal.
So, quit whining about all the pirates and do something constructive that adds to your product or services rather than placing restrictions on your product that makes it less appealing to the end user or customer. Oh, and while you are at it, you might want to put more energy on finding good musical talent for the music industry. Its out there, but you need to stop focusing on engineered pretty boy and girl acts and put more effort into finding and promoting real talent.
just say no (Score:5, Insightful)
yay for free music (Score:1, Insightful)
Universal Music, Here is My Reply (Score:5, Insightful)
Having it both ways (Score:2, Insightful)
(Has this guy even heard of iTunes? People are paying for this stuff), if he wants a tax on the ipod to cover stolen music which it could be used to play, then I think implicit in that is the allowance that, after paying this tax, you can use an ipod to play all the stolen music you want, legally. I belive the recordable digital media tax in Canada works something like this. But what you can't do is tax someone for something, and then sue them for doing the same thing that tax covered.
Here's the problem... (Score:2, Insightful)
Braindamage? (Score:4, Insightful)
Either you fight the pirates and try to sell your music via the iTMS or you get a royalty payment and let your music be available for free.
I'm fed up with the *AAs trying to tell me that I owe them money. I don't. I go see the GOOD movies in theater (there's one coming out every eon or so, maybe you need to check that?) and when I want to watch something, well I have Blockbuster and NetFlix.
Music-wise? Most of the bands they produce suck, and I'd much rather go to a concert, and find the occasional song playing on a radio station than buy a CD or DRM files, because they just want a constant money stream. My wallet says no, and I live just fine without music. Ever walk outside without an iPod plugged into your ears? Sometimes a good hike without music does you good.
The *AAs are beyond a pain in the ass, they're thieving not just people, but businesses as well, and I sure hope that Apple takes them to court for diffamation on that one.
Re:To Doug Morris... (Score:5, Insightful)
Strategy (Score:3, Insightful)
Hence the "precedent" with Universal. I personally don't see how the deal with Zune obligates or pressures Apple into signing a deal as well.
Especially since iTunes is already a loss leader for them, hence they won't just agree Universal eating even more of their hardware profit for something as vague and abstract as "stolen music" tax. Apple isn't selling stolen music on their iPods. End of story.
You can expect Apple making few announcements about banning Universal from their store or something like that and that'd be the end of the story, if it even goes that far.
Apple had to know this was coming (Score:2, Insightful)
This is what happens when you dabble in both content and hardware. As they say, 'you sleep with dogs, you get fleas.' If Apple didn't have iTMS, they could more easily tell Universal to suck a fat dick.
In the end, this is just a negotiating ploy by Universal toward getting 1) a bigger cut of the pie, or 2) non-uniform pricing. This is the next logical step, and I'm sure they gave MS "friend" prices in exchange for being the first official hardware manufacturer to pay a pirate tax. Not much to see here...
iTMS Sales (Score:5, Insightful)
Why not $1000 dollars per iPod? (Score:5, Insightful)
What seems likely is that Morris is demanding an approximation 3% tariff on the sales price like the 3% tariff the industry **already** receives from the sale of all recordable CDs marked "for music." As with Morris proposed "iPod" tax, the public receives nothing in return for music CD-R tax which was supposed to compensate the recording industry in return for not suing equipment manufacturers over Home Recording. As history shows, The Audio Home Recording Act did nothing to squelch the industries thirst for litigation, so there is no reason to think that giving in to an "iPod" tax will do anything along those lines.
If UMG wants to "tax" iPods, they need to give something up in return--like submitting to compulsory licensing for download as they have to for radio station playback and Jukeboxes.
Fuckin' A Right! (Score:5, Insightful)
I have too easy a time imagining this 'fee' increasing every year, every time you buy a new music-related device.
So yeah...they pull this off and I will have ZERO ethical issues about copying every bit of music I can find. Greedy fucks.
Let's not be so quick. (Score:1, Insightful)
Copyright is what holds offer and demand in balance. Otherwise there is NO WAY to know what amount the tax should be. For example, would the tax be the same whether new music in a given year is good or crap? This is a path to hell.
Re:Fuckin' A Right! (Score:5, Insightful)
In the proud tradition of /. analogies (Score:4, Insightful)
Wow, I had no idea that Microsoft cut that shady deal. Now the Universal seems to have quite literally declared they should have a right to both have their cake and eat it, too. They want you to both pay for the music and pay for not paying for it.
I don't own a media player, but now I know that if I ever get one, it won't be a Zune.
And how would they make that happen exactly? (Score:5, Insightful)
Supply and demand applies here:
85% of all MP3 players are iPods.
After briefly debuting as the 7th most popular MP3 player, the Zune dropped to 13th most popular.
Universal gets three choices here:
Put up (only sell music through the Zune store as that is, let's face it, the only influence they have) and deal with only having the 13th most popular MP3 player market to go after... Not going to happen.
Shut up... Also not likely to happen.
Neither... They'll whine loudly, whilst sensibly not daring to cut their noses off to spite their faces, and occasionally create hype inducing headlines.
The previous MP3 taxes on hardware got through five plus years ago when MP3s were something weird the kids do. Passing laws to fine people who don't get a vote is really easy. In the half decade since, huge numbers of middle Americans have bought iPods and they're a part of mainstream society. The ignorance and "aren't l33t pirates bad!" claim doesn't work so well when middle American voters realize it suddenly applies to them and they'd be voting to make their toys more expensive.
So, Zune is such an embarassing joke it can hardly be called a trend setter, Universal won't dare actually boycot iTunes in order to make a point and MP3 players are so popular that the laws that got snuck through in the past now get soccer moms outraged. They can't affect it through business models or laws... Game over.
In much the same way, I want endless women. However, I control such a small part of the dating market that even if I boycot women, I doubt it'll bother them half as much as it'll bother me. I can't get a law passed that forces women to like me because it'd be political suicide for politicians. So, much like universal, that leaves me whining loudly about how things should be and yet nothing actually changing.
Re:Fuckin' A Right! (Score:5, Insightful)
They charge a piracy tax, so we pirate.
They sue, we move to dismiss: "We've already paid for the licence to do this your honour"
-nB
Re:Fuckin' A Right! (Score:5, Insightful)
Would it be too much if it meant that, having already paid the price of your piracy, that you could not be sued for subsequent pirate activity?
I believe this is the situation in Canada. They pay the tax, yes, but then the Canadian music industry cannot go after any of the Canadian pirates. So in theory, you could just go out and download every song they ever published. I bet it's the recording industry who would think they got the short end of the stick on that one!
It won't work that way in the U.S. of course. In the U.S., we will end up paying the tax on anything even remotely capable of pirating music (which is soon going to be everything in your house from your computer to your door mat), and you will be emminently sueable (soon to be jailable) if you actually do pirate anything. They'll charge you coming and going, even if you never touch anything they make, and imprison you if you dare not pay them. Because here in the U.S., we hate the idea of government-owned business, but we love the idea of business-owned government.
They are dumb. (Score:2, Insightful)
Re:YES! This makes PERFECT sense! (Score:5, Insightful)
I RTFA looking for this juicy little quote and couldn't find it anywhere. Am I blind or did the submitter make up a quote for Mr. Morris?
Re:Fuckin' A Right! (Score:5, Insightful)
No, it's not a good thing in disguise. Why? Because that music tax would only go to RIAA-owned artists. Every other musician would get entirely fucked over.
Let's just hope it'll be a blip on the radar.. (Score:3, Insightful)
Many people put indie label stuff on their iPods, and much other unclassifiable music, why should Universal get some $$ and not other labels?
What will happen at this point is anyone's guess, but I would consider that Apple's dominance of the market makes it such that it could fight back.
Otherwise there will be no end to this slippery slope. Warner Bros, Sony/BMG, EMI and all the others will claim the same.
Then it'll be the turn of major indies to hit Apple for a piece of the pie.
Therefore I pray that Steve Jobs and Apple's board of directors will have the sanity and foresight to resist what could be a very sad precedent
for the nascent digital music marketplace.
Just as in the SCO / Linux case, this may be a watermark moment, one that will help forever define our future with regards to recorded music.
Doug Morris is only projecting his own frustrations and those of his company's shareholders, and barely clinging to his job due to the lackluster corporate
earning results for the last 3 quarters at Universal certainly gives him far more motivation to do the saber-rattling act to show what a tough negotiator he is.
(well, that and what evil plotters Micro$oft are for pursuing what some call a 'scorched-earth' policy, so that if Zune fails, they'll make sure everyone else
fails, or at least truly suffers along with them...)
In the current picture of the digital marketplace today, Universal stands to lose out far more than Apple by refusing to renew the license on the existing terms.
Actually, if you retrace Doug Morris' steps and read some recent quotes, (and unless I am mistaken) he was also the most vociferous one behind the concept
that one-size-fits-all pricing had to end, and that his top-tier new artists should get more per download than his deep catalog titles.
Therefore, an interpretation of this would be that this is posturing well in advance of Apple's contract renewal to establish that he will not settle for 'One Price - One Rate',
which Apple has so far been steadfast about. This particular point appears to be one which Apple will have to concede to keep their rights to the Universal catalog,
and wil lead to an inevitable industry-wide restructuring of how downloads are priced.
All joking aside, I really could care less if J-Lo and Britney Spears' downloads jump to $1.49, that in itself is a bit of a joke, but an acceptable one...
Some days I do feel extremely ahsamed and embarrassed for still being a part of what's left of the record business, and likely to be summarily judged as being in
cahoots with the rest of the vultures....Today is just one of those days.
Z.
Re:To Steve Jobs (Score:5, Insightful)
Of course, today the playing field isn't tilting toward Microsoft; it has only manged to sell enough Zunes to eat into PlaysForSure players in week 1; it has since dropped off the charts.
Anyone who thinks Universal can pull its content out of the iTMS and be the victor is smoking crack. The iTunes Store isn't selling everyone their music; its only selling to a small segment regularly. Everyone else is buying CDs or using the iPod to listen to their own music. The iPod has no lock with iTunes Music, you can fill it any way you like.
The labels somehow think that consumers should repurchase their entire music library in electronic form, and when PlaysForSure stores and the iTunes Store didn't, they were puzzled. What is happening is that a small minority of people are paying for music in the iTunes Store, far more than are using any other online system (apart from piracy of course).
If Universal pulls out of the only system that works, it will be left to watch its sales slow down right when online sales through iTunes are the only growing market left for commercial music.
Apple can't afford to be too arrogant, but neither can Universal. Right now, Apple is handing Universal the vast majority of the profits it collects from iTunes sales. If Universal poisons the deal, they're only screwing themselves. The iPod and iTunes aren't going away, and the Zune isn't going to funnel any money to Universal at all.
In the big picture, Universal is desperate for sales, and iTunes is the only system offering something that works. Apple is building that into a movie business, too.
How Original Content Will Change Entertainment [roughlydrafted.com]
Steve Jobs has connections in music, movies, and TV - how long before Apple begins commissioning original programming? Here's a look at the music, movie and TV business, and why Apple's involvement in each is far larger than the mainstream media seems to understand.
the whole idea is silly (Score:4, Insightful)
It's not apple's job to help the riaa and their artists recoup their losses due to piracy. That's like placing a tax on crowbars because people break into cars with them.
Why must people be so stupid?
Re:To Steve Jobs (Score:5, Insightful)
Honestly, I doubt that Universal would be dumb enough to cut off Apple if they refuse so I'm going to assume it's a bluff. And you can be fairly sure that if they are that moronic, there'd be an explanation in the next New Music Tuesday mailing about Universal calling every iPod owner a pirate, and how Apple defended them by not giving in to their piracy tax. When they come begging to get back into iTunes, Apple would probably negotiate a better profit for themselves in the process.
Of course, that's all speculation on my part, but I don't think Apple can really lose here unless they actually give in, in which case they're sure to. AFAIK, Microsoft made the offer to do this (though that could very well be wrong), and probably did so simply to try setting a precedent that works against Apple.
No matter how it works out, it means that I won't be buying Universal music ever again. If a piracy tax works its way into iPods, then it completely legitimizes it in my eyes (only for the labels receiving the tax, of course, not that the artists will see a cent of it). If Universal content gets pulled, I could care less as I won't buy music with DRM. And simply for the fact that they assume I'm a pirate, I'll ensure that I'm not supporting them in any way. As it is, I'd only buy indie albums since I won't fund the RIAA either, and moves like this are NOT persuading me otherwise.
Re:Fuckin' A Right! (Score:2, Insightful)
I'd like to think there's enough people out there like me to make a difference. Maybe there isn't. Maybe there is.
Letter to Apple (Score:4, Insightful)
Re: The iPOD tax
I have purchased Apple products for years and I currently have 6 Macs in my house. I do not pirate (steal) music and in fact have bought a number of complete CDs from iTunes - as well as physical CDs from elsewhere. If you cave into the RIAA, I will take my business elsewhere.
ME
Re:Fuckin' A Right! (Score:3, Insightful)
This is not a good thing in disguise. It's presumptuos and arrogant of Universal to assume that they are entitled to a percentage of iPod sales. What's next? Will they ask for a portion of headphone sales, since headphones are used to listen to illegal music? What about stereos and amplifiers?
Then you aren't paying attention (Score:2, Insightful)
One Musician's Perspective (Score:1, Insightful)
As a musician in precisely that situation I am not merely justified in "pirating" content, it is my duty!
Fuck the RIAA -- Getcher download on!
Re:To Doug Morris... (Score:3, Insightful)
I don't think production workers in a 3rd world country are benefitting a single penny when these tax like additions are made to device players, they serve only to fatten the stuffed wallets of the upper management.
Re:Fuckin' A Right! (Score:3, Insightful)
"They sue, we move to dismiss: "We've already paid for the licence to do this your honour"
Bad logic. The next iPod you buy will likely be priced at $299 or $249 or some other round number; if Apple pays a buck in licensing fees to Universal or some other outfit, they won't add a buck to the retail price.
Apple recently paid Creative $100MM to license the Zen patent; that's likely paid for in one way or another by future iPod sales; and I'm sure that there are other licensing fees that Apple must pay per piece sold. And, the next PC you buy might have, say, some Adobe software on it for which the PC vendor might have paid Adobe a buck or so.
Yet none of these facts give you the legal or moral right to help yourself to a free Sound Blaster, or help yourself to all the Adobe software you want.
By all means, pirate all the music you want if that's your thing -- whatever works with your moral compass. But it's intellectually dishonest to excuse this with the fact that some manufacturer may have paid a license fee to a record company when you bought some device.
I, for one, welcome this tax, but... (Score:3, Insightful)
Re:Fuckin' A Right! (Score:2, Insightful)
Disparity? No, that is not it. They just picked out the easiest person to pull over.
[Cop] Have you ever been fishing?
[Me] Yes. ?
[Cop] Did you ever catch all the fish?
[Me] No.
Re:Sounds good if you legalize file sharing (Score:3, Insightful)
Essentially, yes. If you are buying a newer TV (or laptop, or video card, etc.) with HDMI, you are basically paying content companies for extra crap because it is assumed you will watch pirated material otherwise. Not exactly the same, but pretty damn close. You want to be able to watch anything at 1080p? You gotta pay up - even though your DVI connection can technically handle it just fine, you gotta pay the licensing fees to include HDMI - cause, you know, you can't be trusted just playing whatever source you want at full resolution.
Re:Fuckin' A Right! (Score:4, Insightful)
Your straw man is on fire. (Score:5, Insightful)
When Apple paid Creative, it was for the use of Creative's patents. I don't necessarily agree with the judgment, but that's what it was about. So you're right, that certainly doesn't give me any moral or ethical -- much less legal -- right to go out and steal stuff from Creative, at least not unless you espouse a somewhat extreme form of IP anarchism.
Anyway, the difference between that deal, and the Zune deal (or the Canadian 'media tax') is that Creative's deal with Apple doesn't make any comment about the actions of the users. It's purely between Apple and Creative. What Universal is saying in demanding its pound of flesh, is that users are criminals, and therefore the users should be made to pay for their criminal behavior, before they even do it. That's fundamentally different from a patent licensing deal.
In short, Universal is engaging in collective punishment -- trying to extort money from everyone who buys an Apple product, because they assume they will all be used for piracy. Since I'm going to get punished in that case either way, whether I pirate or not, then I might as well pirate.
Canadians not-sued (Score:4, Insightful)
Moreover, canadian privacy laws blocks the ISP's from giving away names, and the courts have rejected the bogus process the RIAA uses to get the courts to give them the names in the US.
I, for one, am building a shrine to the "unknown RIAA-tricker" every day I load up MP3's.
I don't have music on my iPod (Score:5, Insightful)
Re:Your straw man is on fire. (Score:5, Insightful)
1) Universal wants more money for their music
2) Apple (who really doesn't profit much on iTMS itself) tells them to fuck off
3) iTMS user can no longer buy tracks legally, so they go pirate it instead
Now, Universal, instead of getting some money for their music, gets zero dollars.
Nice.
The parasite kills the host (Score:2, Insightful)
Re:Fuckin' A Right! (Score:1, Insightful)
"The next iPod you buy will likely be priced at $299 or $249 or some other round number; if Apple pays a buck in licensing fees to Universal or some other outfit, they won't add a buck to the retail price."
That gives me an idea: If Apple can tout "we donate $10 to blah blah cause if you buy this iPod (Green)", why not put on the package "the cost of this iPod includes $16 paid to the RIAA/MPAA as a penalty for assumed piracy"? Then we CAN split it out in court to (1) prove our iPods have no pirated content and force a refund from the RIAA/MPAA with penalties and (2) pirate our brains out stating we've paid for the right.
Re:Explains the Zunes wifi transmit ability (Score:3, Insightful)
Re:To Doug Morris... (Score:3, Insightful)
Maybe he couldn't find them because nobody could bear to part with their CDs? if you had to sell some of your collection, wouldn't you sell the trash first?
Re:Why not $1000 dollars per iPod? (Score:2, Insightful)
Which none of them did.
Re:Fuckin' A Right! (Score:3, Insightful)
It would be interesting to see what the courts would make of this. Normally, you can't be held responsible for the crimes of a third party, except where your voluntary actions create an easily forseeable harm. They'd have to show the court that copyrighted tracks are commonly held on iPods. The thing is, while this is true for most MP3 players, I don't it's true for the iPod. Because of the music sore and $0.99 tracks, it's genreally more convenient to buy tracks. Apple could argue that this shows they have exercised reasonable care.
I can't see the courts imposing a "pirate tax"; that's something you might do in a private settlement. In the case of Apple and it's large base of non-infringing users, it would harm too many innocent bystanders. I could see Apple being forced to stop selling the iPod though, which is why this would never come to trial.