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MacBytes
Mar 22, 2008, 10:36 PM
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Category: Tunes
Link: EMusic CEO Raises Antitrust Concerns About Apple's Unlimited Music Plan (http://www.macbytes.com/link.php?sid=20080322233632)
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Posted on MacBytes.com (http://www.macbytes.com)
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iJesus
Mar 22, 2008, 11:32 PM
The guy raises a good point.

But, I do like the idea of iPod/itunes music bundling (a lot)

Yes, Apple would become a monopoly (more than it is already), but I think that overall, it'll probably end up being best for the consumer.


Eh, actually, I don't know.

MikeTheC
Mar 23, 2008, 12:19 AM
The thing with this is simply what Apple's actions suggest about their intentions.

If this were Microsoft, they would probably try to shut out every other vendor from being able to distribute these various artists' tracks. Apple hasn't done that thus far with iTunes, and frankly I see no evidence (anecdotal or otherwise) to suggest this will be the case in the future.

Apple has actually done very well (and seemingly been very happy) with offering a product to the market which the market itself has chosen to embrace (as opposed to how Microsoft had to practically force the XBox -- and to a lesser extent, the XBox 360 -- down everyone's throat). They've basically said "Hey, you know what, we're not the only game in town. Choose whatever solution you want, but we think you'll like ours best."

Apart from that, let's take a look at what the end results would be, assuming this goes over with the general public and turns it into a wild success, and moreover who is actually (not potentially, not hypothetically) harmed.

Music is NOT like software. It's not something which is coded like software, and the music itself is in no way delivery platform specific. In fact, given it's music we're talking about, just about the only way to classify people as being "shut out" is if they're deaf, and therefore are not able to partake of listening to any given song.

Again, this goes back to Apple not signing exclusive deals with the artists. These artists are still selling their CDs through all the usual places, and are selling through e-distribution via multiple channels. I don't really see how "iPods tied to iTunes / iTunes tied to iPods" is any different than saying an application compiled for Win32 or Win64 can only be made to execute in Windows. That doesn't mean the app cannot be made available for other platforms, as very clearly they can. And those various different compilings ultimately give the end-user the same app, but simply compiled for different OS and/or hardware platforms.

So, what's the big deal?

EDIT: Ok, this just occurred to me after typing this.

So, let's say I'm Steve Jobs, and there's this saber-rattling going on out there about Apple monopolizing music, blah blah blah. And we'll skip past the period where I felt talking about it gave it a legitimacy I didn't feel it deserved, so now the noise level is such were I "have" to say something. Here's what I'd do. I'd take out a nice, double-truck ad in the NYT, and basically make it an open letter to the public. It would be worded something like this...

Over the course of the last seven-plus years, Apple has enjoyed a significant renaissance in the public consciousness as a premiere operating system, computer hardware and consumer electronics company. We pride ourselves on providing the best end product, as well as being the best middle-ware vendor in the market today.

As we have become successful, we have learned along the way what it is consumers want, and how they want to have it delivered to, as well as packaged for them. Considering the sales of our iPod hardware products, Apple- and third-party iPod accessories, and quite naturally not the least of which is the massive business success we've had with the iTunes Music Store, we believe our success is based upon the response of the general public to our products, which naturally we believe to be best-of-breed.

Naturally, with success comes responsibility, and Apple takes it's position as a market leader very seriously. Our strategy is simple: produce superior products and services, market those to the public, and allow them to chose amongst the many options available to them. Our history as a company teaches us not to take our customer base for granted any more than we should -- or ever really could -- force our products or services on them. We feel, ultimately, that the financial and other indicators of success we have achieved over the last 10 years comes from reestablishing a bond and trust with those people who support us and buy our products. The financial markets have generally reflected this in their generally very favorable views of us, and we hope to continue building upon our successes in the future in the same way that has gotten us this far.

Thank you for your patronage.

slu
Mar 23, 2008, 12:35 PM
I don't even have to read the article to know this is bull. Apple competes with Wal-Mart and Amazon selling music. That hardly seems like a monopoly to me.

CalBoy
Mar 23, 2008, 12:41 PM
I don't even have to read the article to know this is bull. Apple competes with Wal-Mart and Amazon selling music. That hardly seems like a monopoly to me.

That's at the moment though. If this bundle plan becomes a reality, then Apple would be using its position in the market in order to force people to have music delivered by them as opposed to other competitors like Amazon or Walmart. That certainly would be an illegal monopoly.

zap2
Mar 23, 2008, 06:55 PM
That's at the moment though. If this bundle plan becomes a reality, then Apple would be using its position in the market in order to force people to have music delivered by them as opposed to other competitors like Amazon or Walmart. That certainly would be an illegal monopoly.

But isn't that assuming Apple would no longer allow you to add songs into iTunes from anywhere, but iTMS, which is crazy, and won't happen.

I don't see how this Unlimited music store would be any different. You can still buy from Amazon, Walmart, CDs, etc...its just a person choice.

CalBoy
Mar 23, 2008, 07:01 PM
I don't see how this Unlimited music store would be any different. You can still buy from Amazon, Walmart, CDs, etc...its just a person choice.

Well if all iPods are made to be $100 more expensive, then no one would shell out for more money at Amazon or Walmart, and that would be anti-competitive.

operator207
Mar 23, 2008, 07:23 PM
Well if all iPods are made to be $100 more expensive, then no one would shell out for more money at Amazon or Walmart, and that would be anti-competitive.

The above statement could be true if you assumed that the ipod was the only music device out there. Since its not, its not anti-competitive.

Its called adding a feature and increasing the price of the device that uses said feature. Your car and a better stereo in the higher model, the nav system etc.

And seriously, not to be an ass, but you would be surprised how many people use iPods, but do not buy any music from itunes. Myself for example. And before you throw the *P* word out there, no I *buy* CDs. And I am not an audiophile, just someone that actually uses CDs and MP3's depending on the situation. Yes, I am sure there are people that pirate all of there music. I for one do not.

CalBoy
Mar 23, 2008, 09:21 PM
The above statement could be true if you assumed that the ipod was the only music device out there. Since its not, its not anti-competitive.

That's hardly the correct use of the term "anti-competitive" in a legal sense (which is what we're talking about here).

Microsoft was in the same position as Apple a few years ago when it wanted to tie IE with Windows. Even then, there were other browsers and other operating systems; the key is that Microsoft is able to use its dominant (not necessarily unanimous) position in the market in order to help increase the viability of a different product.

Its called adding a feature and increasing the price of the device that uses said feature. Your car and a better stereo in the higher model, the nav system etc.

This car analogy hardly fits. A better one would be if when you bought your car, you could only fill up gas at one particular company's gas stations. That would remove your choice in future economic transactions (filling up gas or buying new music), which is the very basis of anti-competition law.

And seriously, not to be an ass, but you would be surprised how many people use iPods, but do not buy any music from itunes.

So essentially you agree that this plan would reduce choices on the consumer's end.

Unless Apple plans to make the package optional (ie, $100 for a 1-year unlimited supply of downloads, or the standard $1 for downloads), which would be an entirely different story.

rockosmodurnlif
Mar 23, 2008, 09:48 PM
So what's the difference between Microsoft bundling IE with Windows and Apple bundling songs with iPods?

In both markets you didn't have to buy from Microsoft or Apple and you didn't have to use IE or an iPod.

But Windows was everywhere, that's the difference, but the iPod is everywhere. and you can't get music on your iPod but through iTunes. iTunes, without this feature, is the number 2 music retailer. What happens when you make iTunes free? Why would you go elsewhere?

You paid for an iPod and you get free music, why use another retailer? You paid for a computer and you get a free web browser, why use another browser?

Not that I'm against the feature. I'd like it. I'm just not going to be an apologist for it.

CalBoy
Mar 23, 2008, 10:35 PM
Not that I'm against the feature. I'd like it. I'm just not going to be an apologist for it.

I happen to like the idea as well, but I can't defend Apple against a legitimate objection.

If the law says that this practice is illegal (which it does) then Apple needs to find a way around it; that's what makes a good company exceptional.

rockosmodurnlif
Mar 23, 2008, 10:38 PM
After reading this (http://www.news.com/8301-10784_3-9900250-7.html?tag=nl.e496) [cnet.com], I am now against the idea. Never mind the streaming, I want to own my music.

iJesus
Mar 23, 2008, 10:39 PM
Apple needs to find a way around it

As long as they have Steve and his RDF, they're bound to get it right.
;)

CalBoy
Mar 23, 2008, 10:41 PM
After reading this (http://www.news.com/8301-10784_3-9900250-7.html?tag=nl.e496) [cnet.com], I am now against the idea. Never mind the streaming, I want to own my music.

Indeed, streaming music isn't my thing either. I'd prefer to buy it once and then never have to worry about it again.

As long as they have Steve and his RDF, they're bound to get it right.

Or so it seems...;)

Chundles
Mar 23, 2008, 10:46 PM
So now big CEOs are commenting on Apple rumours?

None of this is true at the moment and people are still wanting to get their 2 cents in.

I think it should be legislated that companies cannot pass judgements on other companies' plans until they are actually announced and real.

There is no iTunes subscription plan, no unlimited access to the store, nothing. Until such time as these rumours become true the CEO of eMusic should just ****.

macnulty
Mar 23, 2008, 11:28 PM
I'm not sure, but to be "anti-competitive" ( as opposed to monopolistic ) wouldn't Apple have to sell an iPod bundle below its cost to produce in an effort to monopolize a market? It is different for, on one hand, a company to produce a product less expensive then any other and sell it cheaper as compared to a company that produces a product then prices it below cost to force out the competition. MS came real close with IE, but by integrating it so tightly with the OS, where able to skirt the issue. For Apple it comes back to is the iPod the only device available to play digital music? No. Wether or not the iPod will only play music from iTunes is really not relevant, an iPod is not your only choice.

CalBoy
Mar 23, 2008, 11:39 PM
I'm not sure, but to be "anti-competitive" ( as opposed to monopolistic ) wouldn't Apple have to sell an iPod bundle below its cost to produce in an effort to monopolize a market?
Pricing is a common tactic used to create an unfair market situation, but it is by no means the only way. A company can still charge more for a product and retain an unfair advantage due to other market forces (for example, Office is twice the price of iWork, yet Office is clearly the dominant player in the market for productivity software).
MS came real close with IE, but by integrating it so tightly with the OS, where able to skirt the issue.
No, that's not how MS skirted the issue. Political fortune saved Microsoft in the end, nothing more.
For Apple it comes back to is the iPod the only device available to play digital music? No. Wether or not the iPod will only play music from iTunes is really not relevant, an iPod is not your only choice.

The question is not about whether or not you have the choice to buy an iPod, it's whether or not you have the choice to choose where your music will come from. This plan will essentially make it impossible for 3rd party retailers to sell music to iPod owners, and that is anti-competitive.

tk421
Mar 23, 2008, 11:57 PM
I don't even have to read the article to know this is bull. Apple competes with Wal-Mart and Amazon selling music. That hardly seems like a monopoly to me.

Maybe you should read the article, because that is not what it's talking about. It's easy to be critical without any information. ;)

So now big CEOs are commenting on Apple rumours?

You know, it is possible that some journalist contacted him. It's not like eMusic issued a press release.

Edit: After looking at some other articles (http://arstechnica.com/news.ars/post/20080323-reality-antitrust-concerns-dog-apple-subscription-rumors.html) on this, I found this quote: "In the end, the whole story is "probably more rumor than anything," Pakman says, and he professes astonishment that the major labels would bind their own digital destinies to Apple." So just calm down. ;)

In any case, I'm with eMusic on this one. If a deal like this emerges, it is anti-competitive.

iJesus
Mar 24, 2008, 12:56 AM
So an easy way for Apple to combat this would be to kind of lay off the MP3 player market and let the numbers go down a bit. Then, when iPod sales have fallen, boom release the bundling, then Apple could say it was trying to save it own ass.

Anyways, people say that nowadays, no one really cares about anything unless they have a stake in it. I think that's playing into the whole game right now.

I think that since iTunes and iPods go together (Remember how Steve always says that it's not the hardware that counts but the software?) the only way that Apple could truly become a monopoly was if it somehow made an agreement with Microsoft to ship iTunes on Windows.

Only 14% of the retail market ever HAD to deal with iTunes, and that is the Mac marketshare. People who installed iTunes on their windows machines and continued to use it saw that both of them worked really well together. If people didn't like how easy iTunes was, they wouldn't have made it number 2 in music sales, and they would simply buy from amazon.

These other companies have to make their stuff more appealing than iTunes. That's the only reason that they're falling behind right now.

In the end, it's all about the consumer. Big companies aren't going to decided what's fair or what isn't, if people see that something is easy to use, they will use it. The only downside to a monopoly is less competition which means more freedom for prices.

Oh, crap...
... I forgot I was currently doing History homework...
:p

slu
Mar 24, 2008, 07:55 AM
Maybe you should read the article, because that is not what it's talking about. It's easy to be critical without any information. ;)


So, I read the article wise guy and guess what? My opinion has not changed. The only way this would monopolistic behavior would be if you could not buy an iPod without this option, and I can't see Apple doing that. That would be shooting everyone in the foot who has already spent lots of money on music to fill their iPod. The outcry would be huge.

And the fact that eMusic and Amazon.com provide content that goes on iPods, along with Wal-Mart and Amazon selling CDs, I find my comment still holds. And what is to stop Microsoft or Creative cutting a similar deal for their mp3 players? If I have the choice of an iPod or Zune both with the same option to pay a premium to fill then up, where is the problem?

cube
Mar 24, 2008, 08:05 AM
iPod is not a monopoly because you can buy CDs and load them on any player,
except for the small number of iTunes Exclusive tracks, which I agree should be forbidden.

Windows is a monopoly because there's no other choice for many applications that depend on it.

PlaceofDis
Mar 24, 2008, 08:10 AM
So now big CEOs are commenting on Apple rumours?

None of this is true at the moment and people are still wanting to get their 2 cents in.

I think it should be legislated that companies cannot pass judgements on other companies' plans until they are actually announced and real.

There is no iTunes subscription plan, no unlimited access to the store, nothing. Until such time as these rumours become true the CEO of eMusic should just ****.

couldn't have said it better myself.
i read the article name and said to myself "Apple has an Unlimited music download subscription? when did that happen?"

it hasn't and it might not. people should only comment on facts, not rumors.

tk421
Mar 24, 2008, 08:42 AM
...The only way this would monopolistic behavior would be if you could not buy an iPod without this option, and I can't see Apple doing that....

But that is exactly what the plan is. Apple pays the label a set fee per device. The consumer never pays anything. This is NOT a plan you subscribe to, it is part of the iPod. In which case, why would you ever pay another provider?

tk421
Mar 24, 2008, 09:57 AM
...people should only comment on facts, not rumors.

What's the name of this website again? ;)

I can see the point, that a CEO is different than the general public. However, I expect that he was contacted by a journalist, not the other way around. The headline doesn't make it sound like that, but his whole tone in the interview sounds like he's answering questions.

PlaceofDis
Mar 24, 2008, 11:20 AM
What's the name of this website again? ;)

I can see the point, that a CEO is different than the general public. However, I expect that he was contacted by a journalist, not the other way around. The headline doesn't make it sound like that, but his whole tone in the interview sounds like he's answering questions.

well of course i meant CEO's and other competitors. :p
and there is always the "no comment' option too.