There are no good guys in Apple's fight with the music industry

Posted Feb 8th 2007 9:05AM by Jonathan Berr
Filed under: Products and Services, Industry, Internet, Competitive Strategy, Microsoft (MSFT), Apple Inc (AAPL), Columns

In a move that shouldn't have surprised anyone, the music industry rejected Apple Inc.'s (Nasdaq:APPL) Chief Executive Steve Jobs' suggestion that they remove anti-piracy technology from recordings.

Mitch Bainwol, chairman and chief executive of the Recording Industry Association of America, instead urged Apple to open up its proprietary digital rights management software so that users can play songs bought on iTunes on other devices, according to the Associated Press. That's the same idea being pushed by some governments in Europe.

Both sides claim that they are worried about security. Apple has said opening its technology up would enable hackers to figure out how to thwart it. The record labels have been worried about piracy over the Internet for years. What both sides are really concerned about is the bottom line.

Apple is coming under increasing pressure from some governments to allow people who don't own iPods to be able to download songs from iTunes. The company doesn't want to be forced to be magnanimous and lose any of its considerable advantage it enjoys in the marketplace against upstarts such as Microsoft Corp.'s (Nasdaq:MSFT) Zune.

The record companies continue to struggle even with the boost in digital music spurred by Apple. Data from the RIAA shows that the total value of music shipped during the first six months of the year fell 6.1 percent to $4.9 billion. Shipments of physical units fell 15.7 percent while digital revenue soared 86.6 percent and ringtones grew by 97.5 percent.

So, it's in the interest of both sides to find a way to work out their differences. Apple and the music industry have always had a love-hate relationship. They at least need to create a situation where they can tolerate one another while muttering insults under their breath,

Tags: digital music, DigitalMusic, ipod, itunes, record label, recording companies, RecordingCompanies, RecordLabel, zune

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Reader Comments (Page 1 of 1)

2-08-2007 @ 11:18AM

August said...

Sorry to be repetitive (I posted this the other day on a similar blog), but this lopsidedness of this issue has me in slack-jawed amazement...

Why is no one discussing the other side of this issue? I'm talking about the one that gives an owner / author / inventor, a right to their to intellectual or physical property via patents, trademarks and copyrights and a subsequent profit through protection of ownership and free enterprise? Why should Apple or the record companies, authors and inventors of these works and technologies grant all competitors and the public at large, free OR SHARED, access?

Help me out here folks, as I can't see communal theft, (or should I say "forced free sharing"), as a good sign for our future... financially or socially. Can't you just see it in 2010... "Our Chevy doesn't have air conditioning, but yours does. So, due to my rights as a member of society, I want to ride in your car instead of mine." OR... "We like MS Word better than our freeware version of "Type A Lot," because it works so much better. So, we demand that Microsoft release all their technical information and years of R&D to "Type A Lot," for free, so "Type A Lot," and therefore we, can benefit at Microsoft's expense and through no effort of our own."

You won't be ridin' in my Chevy.

Thanks for listening.
August

2-08-2007 @ 11:36AM

August said...

The sign over the Apple iTunes door says just that, "Apple and iTunes." If you don't want what they sell, (or the way they sell it), it's simple... JUST GO SOMEWHERE ELSE! There's a zillion places that sell music online. There is not a trace of monopolistic environment going on here. In fact, online competition abounds. Or you can always buy the CD. The real truth is... everyone wants the EASE of the iTunes site to put music files into an easily accessible form, and then get irritated when Apple doesn't share the benefit of their gigantic R&D investment for free.

To illustrate, here's how things in a non-communist country work...

If you go to Ruth's Chris', buy a steak and don't like the way they season it, the next time you'll simply GO SOMEWHERE ELSE. Or if you don't like the WAY they provide service, the next time you'll GO SOMEWHERE ELSE. And if you don't like somewhere else, or the next place, or the next place, you can always COOK YOUR OWN.

So it is with iTunes. They are only one of many outlets for music, just as Ruth's Chris' is one of many outlets for meat. If you like their flavor, buy it there. If not, simply GO SOMEWHERE ELSE.

Thanks for listening.
August