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Music Businesses Media Apple

Behind the Scenes In Apple Vs. the Record Labels 146

je ne sais quoi writes "The New York Times recently posted an article describing what really happened between Apple and the Record labels that culminated with the January 6th Macworld Keynote by Apple Senior VP Phil Schiller." Essentially they discuss a bit of a swap: Apple allowed variable pricing for songs and the industry allowed DRM free music. And apparently the iTunes homepage is a huge hit making device. Big shock.
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Behind the Scenes In Apple Vs. the Record Labels

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  • misleading wording (Score:5, Informative)

    by Sloppy ( 14984 ) on Wednesday February 04, 2009 @01:39PM (#26727167) Homepage Journal

    record companies gave up their demand for copyright protection (called digital rights management)

    No, they gave up DRM, and copy protection is sort of related to that. They did not give up anything even remotely related to copyright protection, unless I somehow missed the part where Apple talked RIAA into releasing works into the public domain.

    That's just plain wrong. Bad reporter!

  • by m93 ( 684512 ) on Wednesday February 04, 2009 @01:42PM (#26727207)

    Apple can't open it's own record label. From Wikipedia: "In 1978, Apple Corps, the Beatles-founded holding company and owner of their record label, Apple Records, filed a lawsuit against Apple Computer for trademark infringement. The suit was settled in 1981 with an undisclosed amount being paid to Apple Corps. This amount had been estimated to be US$50â"US$200 million, but was later revealed to be US$80,000.[1] As a condition of the settlement, Apple Computer agreed not to enter the music business, and Apple Corps agreed not to enter the computer business."
    http://en.wikipedia.org/wiki/Apple_Corps_v._Apple_Computer [wikipedia.org]
    They got into hot water with Apple Records when iTunes got big. An actual recording label would blatantly go against the agreement.
  • by kannibal_klown ( 531544 ) on Wednesday February 04, 2009 @01:48PM (#26727285)

    ...
    The one interesting idea brought to the table was the idea of a "subscription fee" for music... pay a monthly fee and listen to _whatever_ you want. I'm not sure how I feel about that. On the one hand, I kinda like it as a compromise between DRM and piracy, but on the other hand, it doesn't seem like that would _stop_ piracy at all.

    The subscription thing has been done. There are one or two mainstream services that offer that. Some people love it, others hate it.

    Personally I'm not a fan, while listening to anything I want on-demand is cool I hate subscriptions, particularly for something like this.

    I'm not that into music. On average I buy maybe 1-2 songs a month from iTunes, more if I get a gift card or want a whole album. That's $24-$36 USD per year with the latest variable prices, and I get to keep my music.

    If I was REALLY into music and listed to a LOT of stuff then I could see the benefit. But for me, i'm fine with the occasional song purchase.

  • by Midnight Thunder ( 17205 ) on Wednesday February 04, 2009 @01:48PM (#26727293) Homepage Journal

    Appleinsider also covered the same subject, so I'll you decide if it is any better:

    Heated Christmas call from Jobs secured iTunes changes [appleinsider.com]

  • by idobi ( 820896 ) on Wednesday February 04, 2009 @02:01PM (#26727457) Homepage

    Apple can't open it's own record label. From Wikipedia: "In 1978, Apple Corps, the Beatles-founded holding company and owner of their record label, Apple Records, filed a lawsuit against Apple Computer for trademark infringement. The suit was settled in 1981 with an undisclosed amount being paid to Apple Corps. This amount had been estimated to be US$50â"US$200 million, but was later revealed to be US$80,000.[1] As a condition of the settlement, Apple Computer agreed not to enter the music business, and Apple Corps agreed not to enter the computer business." http://en.wikipedia.org/wiki/Apple_Corps_v._Apple_Computer [wikipedia.org] They got into hot water with Apple Records when iTunes got big. An actual recording label would blatantly go against the agreement.

    This agreement is no longer in effect. Apple Corp has signed over all Trademark for Apple to Apple Computer, Inc (now Apple Inc) in 2007. In return, Apple Corp has a perpetual license to use the Apple name for their label. However Apple Inc. can now do whatever they want with regards to the music business.

  • by SuperKendall ( 25149 ) on Wednesday February 04, 2009 @02:16PM (#26727669)

    This is part of what an iphone "killer" has to overcome (I'm looking at you Palm).

    But with iTunes songs being DRM free now, Palm doesn't have to build their own iTunes - they just have to be able to feed songs into their own device from the users iTunes library, and support AAC (an open audio format).

    They could even list all songs and ones that are still locked down could take you to the Apple iTunes Plus page to unlock (which you can happily do on a song by song basis now).

  • by UnknowingFool ( 672806 ) on Wednesday February 04, 2009 @03:18PM (#26728425)
    Correction: Jobs is the largest single stockholder in Disney. He owns approximately 7% of Disney. "Primary Share holder" was more correct for Bill Gates who used to own more than 51% of MSFT. Currently Gates is also largest single stockholder with 8%.
  • by Anonymous Coward on Wednesday February 04, 2009 @03:37PM (#26728683)

    Or a similarly-featured open source program that is dedicated to interfacing to many different music sales sites could show up on the scene...

    www.getsongbird.com

  • by anagama ( 611277 ) <obamaisaneocon@nothingchanged.org> on Wednesday February 04, 2009 @04:07PM (#26729039) Homepage

    They already sell the software to make the tracks: http://www.apple.com/logicexpress/#recording [apple.com]

    And it looks there is some sort of approval process at Apple to get your songs online, and lots of various companies that will help with this step, for a fee of course. http://answers.google.com/answers/threadview/id/564768.html [google.com]

    The only missing part is the free-for-all publishing system of YouTube, which is probably a good thing.

  • by JakartaDean ( 834076 ) on Wednesday February 04, 2009 @07:56PM (#26731489) Journal
    I'm feeling terribly left out of all of this. I've got tons of albums, most of which are electronic copies of stuff I've bought, in many cases more than once. I bought my SO an iPod Touch for Christmas, and was gutted to learn that it doesn't work with Linux, which is all I run at home. Amarok will sync my older iPod just fine, but Apple apparently encrypts all the contents of the iPod Touch library as some kind of DRM thing. So, anybody wanna buy a $350 iPod Touch?
  • Apple Margins (Score:3, Informative)

    by meehawl ( 73285 ) <{moc.liamg} {ta} {todhsals+maps.lwaheem}> on Wednesday February 04, 2009 @08:49PM (#26731959) Homepage Journal

    Now you have Apple negotiating on your behalf for lower prices ... If Apple's dominance in music distribution is ever broken, expect prices to double or triple as you'll have no one with any power negotiating on your behalf anymore.

    As I read the article, it seems it was the labels that wanted "variable" pricing, and Apple that wanted to stick with $1/track.

    I don;t think you are right about lower prices. All the other a la carte services have generally undercut Apple's pricing, usually $0.8 or so per track, except for the high quality lossless tracks that were often charged at over the $1 mark.

    Furthermore, given Apple's historical aversion to low prices (its margins have generally been at least a generally reliable ~3x the industry average), I'd think that its premium prices for hardware would be reflected in its software licensing prices as well.

  • by mattack2 ( 1165421 ) on Wednesday February 04, 2009 @09:54PM (#26732453)

    Personally, I buy CDs.. But the easy UI isn't also an 'impediment'?

    Although very few non-Apple players support AAC, even unencrypted AAC, there's no barrier to that changing.

    From:
    http://en.wikipedia.org/wiki/Advanced_Audio_Coding [wikipedia.org]
    in the "Other Portable Players" section:

    Creative Zen Portable
    Microsoft Zune
    SanDisk Sansa
    Sony PlayStation Portable (PSP) with firmware 2.0 or greater
    Sony Walkman
    SonyEricsson Walkman Phones-W series, e.g. W890i
    Nintendo DSi To be released in America mid-2009
    Slacker G2 Personal Radio Player

    and 3 non-Apple phones, and a whole bunch of "Other" devices. Woah, that's very few, all right.

  • The issue of whether something is or isn't infringement depends on whether it would be confusing, and cause consumers to assume that one product is produced by another company -- essentially free-riding on the other's reputation.

    My understanding is that the Apple Records vs. Apple Computer suit never got to the point of determining whether that was the case. If the suit had gone forward, a judge would have needed to rule on it one way or the other. But before that happened they arrived at some sort of deal, in which Apple Computer agreed to stay out of the music business and Apple Records out of computers. That deal persisted until 1997, when Apple Computer basically bought Apple Records out and acquired sole ownership of the "Apple" marque.

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