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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."
And so another company that had an emerging monopoly blows all of its accumulated goodwill and demonstrates why monopolies are ALWAYS bad. And, no, there is no such thing as a NATURAL monopoly. Nature abhors monopolies.
I have nothing to hide. So, why are you spying on me?
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??
...When used with a portable music player, then for any third-party accessory to match the ipod, they'd have to license Apple's patent...charge extra for the right to use Apple's "White Power certified" trademark on their accessory.
No true ipod weenie would buy or use a non-matching accessory.
So, Is MPAA to Apple as Apple is to add-on makers?
Or is Greedy generic enough to cover all the bases?
IMarv
Trusting software vendors is no smarter than trus
...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.
First record companies say that they want a cut of iPod sales, and Apple says "Oooooo, that's bad! Can't do that!"
Now they're turning around and telling add-on companies they want to do the same thing???
Geesh
With the swift turnaround of Jobs to support video iPods (but where's the content?) it is uncomfortable to see companies search for more money in such a way. What will be next?
I think this will make companies reconsider, that are looking to develop software or hardware for the mac.
If it's only money for analysis and approval of the item though, it wouldn't bother me that much though.
B.
Every experiment which ends in a big bang is a good experiment.
So wait, do we love or hate Apple today?
I'm just waiting for the Tax tax, you know it's coming...
I don't get it.
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
I can see this going two ways.
On the one hand, people will cry out "Monopoly!" and point at Apple. Naturally, Apple's dominance in the MP3 player market makes it a likely target for such a label, and a move like this certainly helps reinforce that image.
But on the other hand, the manufacturers of the third party add-ons are making a mint off the iPod themselves. If their entire industry is based on the existance of the iPod, doesn't Apple have the authority to ask for a cut of the sales? Without the iPod, those accessories wouldn't exist. I'd see it as paying a royalty to use the iPod brand/name/whatever. Items marketed as "For use with iPod" should pay to use the name "iPod." For some reason, a set of speakers marked as "iPod Speakers" sounds better than "Speakers for use with that fruit-named company's music player."
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.
First MS releases an innovative wireless software with source. Then Google screws with privacy and Apple becomes "evil" and screws some vendors. Yikes! The /. Crew most not be happy today!
How does Nintendo handle the addons for its various handheld gaming systems? How do the addon manufacturers handle it? How do they refer to their compatibility with Nintendo devices? Do they flat out say, "GameBoy-compatible" or do they word it to avoid naming the Nintendo products supported?
Cyric Zndovzny at your service.
The camera makers like Canon don't sell rights to make compatible
lenses. So if you buy a non-Canon lens for your SLR, you are in effect
buying a pirated product. And camera makes change their systems
all the time to make them incompatible with lenses by third parties.
Apple could follow suit - but by licensing Apple allows third-party
innovation. Good for Apple, good for iPod accessories, good for
iPod users.
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
"It's not clear what means Apple might employ if companies don't go along, as Apple declined to comment on that."
They'll likely do what they've always done. If someone makes an iPod accessory and doesn't pay the "tax" they'll send in the lawyers.
It makes me wonder if they got the same people who came up with the Microsoft Protection Racket to come up with this idea.
This is my opinion. To make sure you don't steal it, it's covered by the DMCA.
Nature abhors monopolies.
/.?
How can you say that, look around you!
- How many websites compete with
- Humans have a monopoly as far as higher order 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)
- Almost all useable light that shines on the Earth and helps to create/maintain life comes from a single source
- Much of what is animalistic instinct is to try to attain a monopoly at any stratum.
This kind of reminds me of the old deal with the gold "Liscensed by Nintendo" emblems that used to appear on cartridge labels back in the 80's.
As other companies figured out how to zap Nintendos lock-out chip so they could make their owned games without the shiny gold emblem, Tengen just went ahead and used legal action (which they eventually lost their case for miserably) and got the code for it from the copyright office. After that, the Tetris suit, retailers not carring Tengen titles due to threats from Nintendo, they were ultimately strong-armed and shut down by Nintendo.
Now I don't know what ever came of the manufactorer that made the un-Nintendo-liscensed "Chiller" and "Baby Boomer" titles, but something tells me they didn't exactly become a big success.
So in the case of Nintendo... despite Nintendos bullying and Tengens efforts to get things done their way, Nintendo is still a loved company and Tengen is out of business.
Would the same sort of thing happen for Apple with the iPod accessories? Perhaps. As much I despise Apple and would never own an iPod... I know there are plenty of people who think different (as lame as different may be) that will be more than happy to shell out big bucks for their trendy accessories with Apple logos on them.
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
"Let me put it to you this way: I earned capital with the iPod, geek capital, and now I intend to spend it. It is my style" -- Steve Jobs
Beauty is in the eye of the beerholder.
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.
selling accessories to end users have ANYTHING to do with apple?
once an ipod is sold to a customer, apple no longer has any say over what happens to that device or how it interacts with any other devices.
period.
this is pure bullshit.
same racket that console manufacturers run.
getting permission is NOT required by moral law. legal laws are completely obscene. and even there, there might be ways of not bending over to corporate interests.
that's the definition of property laws. if you own property, you can do just about anything you want, barring things which can cause death or injury.
no one needs "permission" to make accessories for any device. but that's what DRM is for. now you're getting the hang of it. without DRM and DMCA, it would be a simple matter for people to exercise their property rights.
now you know, and knowing is half the battle.
Science : Proprietary , Knowledge : Open Source
This is the same reason we are saying "empire it has built on the iPod" instead of "empire it has built on the Mac".
At the end of the day, this screws iPod owners more than anyone else. Like Honda Civic owners, we have enjoyed a rich ecosystem of aftermarket products that pay dividends on our iPod investment. An iPod with the right third-party accessories can be a recorder, a transmitter, a boom box -- even a laser-pointer. Buying an iPod paid out well, because the iPod was a platform for innovation.
Apple's closing of the open market can only retard innovation. The space of accessory-makers willing to pay and ask for permission is necessarily smaller than the space of all potential accessory-makers. That means less competition for iPod accessories, which means higher prices and less innovation. That means that The Steve just devalued our investment in iPods.
One question: once permission is required, mightn't it be withheld? Can we be certain that Apple will allow all comers to buy a license? After all, they already threatened to sue a competitor, Real, that wanted to add new features to the iPod. What other new features -- features that iPod owners can benefit from -- might Apple veto?
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
I'm going to start charging companies who manufacture accessories for me, like hats, clothes, and life jackets.
OddManIn: A Game of guns and game theory.
And what's the market price? If there's only one seller, what justification do you have for determining that price? Even if you're right, how do you know that prices wouldn't be even lower given real competition?
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
Apple is just as monopolistic as Microsoft, and always has been. Apple's friendliness with the open-source community is self-serving: Apple just needed a good OS quickly, and a free UNIX-like system was the obvious choice.
At heart, Apple is just another proprietary company, which is saved from being perceived as evil by it's small share of the computer market. (iPod is a different story; the large market share allows the evilness to come out.)
AC: Nonsense. Do you think generic inkjet cartridge manufacturers get HP's or Epson's permission before telling consumers exactly which make and model printer a specific generic inkjet cartridge works in?
That is a great counterpoint. This gets into legalisms details that I'm not qualified to comment upon. Isn't Cpt Kangarooski a lawyer? Maybe if he notices this thread he (or another lawyer) will comment upon the legalities of Apple's actions with better expertise. --M
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.
"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"
Add these to your list:
proprietary closed DRM format that no one can license who wants to make a compatible player
no support for DRM formats supplied by competitors who sell music online.
Trying to leverage iPod to cause people to switch from windows is a ridiculous benchmark to determine whether they're a monopoly. In reality, their behavior clearly indicates they're leveraging their mnopolies in online music and mp3 players.
Vote for Pedro
One of the biggest themes in software industry failures is a platform vendor that didn't understand that they were a platform vendor, so they alienated their key constituency: the developers.
But I got MY tinfoil hat for FREE!
"Speaking the Truth in times of universal deceit is a revolutionary act." -- George Orwell