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iPod Tax Causes Sour Apples
An anonymous reader writes "Apple Computer is stepping up its push to get iPod accessory makers to pay for the right to connect to the popular music player." From the article: "It's not clear what means Apple might employ if companies don't go along, as Apple declined to comment on that. Though many manufacturers have signed up for the program so far, some have complained in private that it's too high a price. But for Apple, the move is a chance to profit further from the empire it has built on the iPod, given that the market for such add-ons is estimated in the hundreds of millions of dollars per year."
If you want to say "Made for iPod", pay the money. If you don't, then say something else.
"I'd rather be a lightning rod than a seismometer." -Ken Kesey
Doesn't this sound EXACTLY like what Apple is dissing the RIAA for, i.e. trying to make more money off of the IPOD?
If Apple doesn't do the engineering for accessories or the manufacturing - I see NO reason they should receive the profits?!?
I have similar feelings about Apple paying RIAA.
Have you compiled your kernel today??
...accessory manufacturers are complaining. The cell phone industry has been doing this for years. There will always be cheap knockoffs though, just take a look on EBay for that.
I may be wrong in my history, but if memory serves me correctly-
*takes a bite out of a yellow pepper*
- Atari (or was it Colecovision? It's been so long ago I can't remember) originally had a "no license fee" to their system. Which leads to an overabundance of very crappy games, which lead to death of the system.
When Nintendo had their NES system, if you wanted the "Gold Sticker" of quality, you had to go through Nintendo's process and give them a cut for the licensing. Which forged a company that is profitable even today.
So, is Apple being "teh evil" by enforcing a trademark license - if you want to use the words "Made for iPod" on your product, you pay the fee that lets them decide if your item is actually worth it. Or, you can go the Gameshark route and *not* license your product and sell it as "iPod compatible, not licensed by Apple" and still make money anyway.
Personally, I think that Apple's being a touch overhanded here, but they're working with an existing model, one they hope to bring them enough money to continue to fund new products and new directions.
Of course, this is all just my opinion - I could be wrong.
52 Weeks, 52 Religions with John Hummel
You will know when Apple has gained monopoly marketshare when they leverage MacOS X on Intel by forcing iPod users to drop Windows. Somehow, I think Apple demanding certain manufacturing agreements with industry players doesn't quite measure up to a "portable mp3 music player" monopoly. --M
For myself, the ONLY reason I own an iPod was the amazing plethora of accessories avaialable for it. It's simpy not a very impressive MP3 player (other than styling), but being able to choose from a bazillion accessories makes it pretty attractive.
If Apple tries too much of this, they're going to learn that holding a majority share of a market is NOT the same as a monopoly. Piss off the market enough, and Creative is going to sell a LOT more Zens.
This sounds extrmemly reminiscent of the ill fated "mac clone" fiasco a few years back.
what a stupid and terrible headline. there have been ipod taxes enacted and talked about in other countries, so a headline like this makes it seem like the story will actually be about taxes imposed on ipods and customers who buy them.
think.
-- lol pwned
A: Around about the middle of '90, while Sculley was at the helm, Apple raised prices across the board. Product demand was strong, and Apple shipped more systems per year than anyone. They figured this was an Econ 101 situation, and raised prices with only a fig leaf attempt to bs their way out of it. Obviously someone dropped out before Econ 401, which would have taught the costs of trading on "good will", when they could have been looking at increasing their market share upward from 20%.
B: Learning from Atari's experience where unmanaged 3rd party game developers flooded the market with crappy product, Nintendo required developers to register with them for the right to see the NES s/w development tools, or get any cooperation in distributing game carts. While some moaned that this was a restraint of trade and raised prices, Nintendo was able to control who traded on Nintendo's good will.
So, which is it for Apple, this time? Any knowledgeable insider Anon Coward care to comment?
Luke, help me take this mask off
The article says that this tax isn't for all accessories, only the ones that attach to the connector on the bottom of the device.
It's also something where they are trying to insure that these devices won't harm them in the long run. TFA states that having the "Made for iPod" seal on these devices ensures that these deviuces will work on current and future iPod versions.
If I was Apple, I wouldn't want some third-rate speaker system to be designed for the current generations of the iPod, then not work on all future versions, having this burn the buyer into not wanting to buy newer versions of said speakers to continue to enjoy his/her iPod and feeling jaded by the iPod that a certified piece of gear would be gauranteed to do from the box. I think it's a good move for the future.
Napalm is nature's toothpaste
Many many software companies based their products on the existance of Windows, does MS have the authority to ask for a cut of the sales?!!
I suspect the bigger companies will go along, seeing the fee as away of keeping smaller players from moving into the market.
Think Deeply.
Apple is providing technical information and support for accessories that want to electronically interface with the iPod. There are no charges for cases and other types of products. Apple is also standardizing on the iPod connector and including form factor adapters with iPods to allow them to continue working with existing accessories. These services and adapters will cost Apple money. Maybe they are charging too much, maybe not, but it is not unreasonable to charge them. Both parties will benefit. The vendors get to continue to ride the iPod phenomenon and Apple gets to offset some, or maybe all, of the cost of supporting and accomodating these guys.
Are you really being serious?
Step out of the Apple box and think about the millions of products in this world and the millions of additions that you can buy for them without paying a kickback to the parent. The first thing that comes to mind is aftermarket products for cars which is probably a billion dollar industry. I do not have to pay Ford license fee to put a Fram filter, Monroe shocks, Michelin tires, Panasonic stereo, a Midwest Mustang hood scoop, BBS rims, a trailer hitch, a Vortech supercharger, larger after market fuel injectors, and a set of heads from some company in central Florida on my car. To even think that some licensing agreement with Ford should exist before hand 100% is completely insane.
Even using the iPod for an example, do you think anyone selling headphones with a standard 3.5mm stero plug should have to pay Apple for it?
Please don't give me that typical poor Apple story about Apple ensuring only quality accessories are available and no junk allowed. The free market will sort that out and has for every other after market product ever made for probably the last hundred years.
This is nothing more then an attempt by Apple to cash in on others improvements. Almost as bad and very similar to the RIAA wanting a part of the iPod sales money from Apple for the same thing. RIAA thinks Apple owes them money because iPods play their music and profits from their work --> Apple wants money from accessory companies because they use the iPod to make products for and profit from apples work. Wow, change your mind now? Do you consider one bad and one good?
If anything, a heathly after market of iPod things would HELP overall iPod sales.
I am sorry to rant if I misunderstand your position on this
Bad boys rape our young girls but Violet gives willingly.
That's an oxymoron.
Look, one might disagree with Apple's policy for any number of valid reasons. For example: it's a poor long term policy if one believes in the importance of business relationships; it stifles Apple's secondary manufacturing market and thus impacts the utility of their product line the consumers; the short term gains aren't worth the potential long term losses... blah blah blah. But then you'd be forced to argue the profit potential and long term effects of their policy instead of simply claiming a negative gut reaction. So you don't like it. If it pisses you off enough, buy a competitor's product. But don't claim it is proof of a monopoly. There are plenty of third party portable mp3 and digital music players on the market. Apple can neither force their competitors out of that market, nor can they use the iPod to leverage their other market (computers, Operating Systems, and application software). Deal. --M
- How many websites compete with /.?
How about fark? Ars Technica? news.com.com.com.com? What's keeping me from starting my own and competing well? What could Malda do to cause me to not be able to compete?
- Humans have a monopoly as far as higher order species.
High order as in what? Insects outnumber us by a huge amount, and they're a huge problem in the continuation of our species.
- The Earth has a heck of a monopoly on liveable planets (at least in our solar system, at least as far as we can tell)
Earth didn't 'compete' with another planet to obtain life.
- Almost all useable light that shines on the Earth and helps to create/maintain life comes from a single source
Once again, no competition is involved. Stupid analogies don't work.
- Much of what is animalistic instinct is to try to attain a monopoly at any stratum.
I thought that instinct was a mechanism for self-preservation. Oh, wait... it is.
I don't want to defend the policy, because there are plenty of reasons why it might be a mistake for Apple to try to extract revenue with partnering manufacturers like this. However, just to respond to your Ford analogy, if a third party manufacturer wanted to include the line "Made specifically for Ford Bronco" on the packaging of their product, Ford would certainly demand a contractual agreement with the manufacturer in order to deal with trademark issues. They might even demand a payment for use of those terms.
The situation with Apple is no different. Apple demands payment for allowing third party manufacturers to use the term "Designed for iPod", almost certainly a trademarked term. With this agreement they also provide some technical specs to properly interface with their product. There is nothing improper with Apple's demands here. Maybe it's bad business sense - or maybe not. *shrug* --M
I do not have to pay Ford license fee to put a Fram filter, Monroe shocks, Michelin tires, Panasonic stereo, a Midwest Mustang hood scoop, BBS rims, a trailer hitch, a Vortech supercharger, larger after market fuel injectors, and a set of heads from some company in central Florida on my car. To even think that some licensing agreement with Ford should exist before hand 100% is completely insane.
Whoa, so you think that a company doesn't pay to put a Ford logo on it's retail box in order to say that it is "factory blessed"? You've GOT to be kidding. Of course there are licensing fees involved.
Some product companies don't want to pay a license fee, and so they can't use the official logo. Fram is a good case - they have a good reputation, so they don't NEED to license anything from Ford. On the flip side, Ford won't bless just any crap product for logo use.
The decision to buy a license strictly depends on if the seller thinks it's profitable to use the logo (giving customers comfort, and therefore increasing sales) at the expense of the licensing fees.
These licensing deals happen all the time. Most customers don't realize it. If you see a product box with an MS-Windows or MacOS logo on it anywhere, you can bet that there is a license involved.
The gist of this is not that people can't make products for the iPod or can't use the phrase "for the Apple iPod" but rather that there's a special connector with a proprietary protocol. To get the information for interacting with the iPod, you have to pay to be part of the program. Car stereo manufacturers have been doing this for years (Alpine's Ai-net or Sony's S-Link). Most third-party groups might complain about the price, but paying it puts them in a position to have few competitors. The complaint isn't about the 'tax'. Rather, they're annoyed by the bump in price. An open protocol would make the iPod more popular with end users, but saturate the market with alternative accessories. If the accessory manufacturers can afford to buy in, it's in their best interest to do so and hope the other guy doesn't.
Nobody is telling the manufacturers that they can't develop and sell products for the iPod. Apple just won't help them without compensation. Besides, while popular, Apple hardly has a monopoly on mp3 players.