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Microsoft Chided Over Exclusive Music Idea
grumpyman writes "The federal judge overseeing Microsoft Corp.'s business practices scolded the company Wednesday over a proposal to force manufacturers to tether iPod-like devices to Microsoft's own music player software. Microsoft blamed the proposal on a newly hired, "lower-level business person" who did not understand the company's obligations under the antitrust settlement."
You are smoking crack. The iPod and iTunes are as anti-competitive as it gets. The hardware is completely closed and no third party software can run on it. There are also a limited number of codec's that work with the iPod. The only thing that you can do is play AAC, MP3 and DRM'd apple music on it. It is a black box. It even enforces DRM practices on non-DRM music.
Apple chooses to enforce their monopoly on the market by forcing consumers to use only apple products to access the iTunes music store - No iPod, no iTunes. It is a monopoly now - because Apple currently has a majority of the mp3 player market share, and a 100% monopoly on music encoded in an Apple DRM format. They are also actively discouraging 3rd parties from interfacing with their hardware and software (real player). Thus, they are using their monopoly advantage to exclude competition in the market of players that can play AAC/DRM formatted music. It is of course their "right" because they manufacture the hardware and software. Ultimately, the lack of formats on the iPod reduces the consumers' choice decreases the utility of the device thus harming the consumer. This again is the mark of a monopoly. Though the rough textbook definition is "monopoly: If a certain firm is the only one that can produce a certain good, it has a monopoly in the market for that good." (econterms.com)
To put this in a MS context: If Microsoft manufactured their own player - and their own software for playing and listening to music. Then they *actively* discouraged other vendors and companies from interfacing with their software and seemingly refused to grant licenses at a reasonable rate - they would probably be taken to court. As it is, there are a variety of WMV capable players out there and a number of music services that utilize the format for content delivery.
As a parallel observation to the current discussion - Apple has actively pursued an anti-competitive strategy both on a software and hardware level. Take for example the difficulty in getting Linux to run on Mac hardware, or BeOS. Or perhaps the total lack of 3rd party hardware that can run OS X? OS X as it currently ships has as many or more features than XP SP2. The real indicator of monopolistic practices at work is a lack of diversity in a market place. In the case of apple, there are apple logos on just about everything a Mac user would buy, or what the get for "free". Sure, there are features there that other products do not have such as the AirPort express with iTunes integration. However, that is a result of Apple's unwillingness to license Apple DRM to other companies on a reasonable basis. Apple's transition to a Media platform will only worsen this trend. As this battle continues Apple will use licensing and intellectual property as their cudal in the fight against competition.
It would not be so bad if all of Apple's products functioned as well as they are formed. Apple's products are generally beautiful, but the nice design comes at a cost. In the last three years hardware issues have plagued the iPod line. Starting with the Apple Battery scandal, Massive iPod mini DOA issues, almost everyone I know has had some problem or another with their iPod. Their machines have had problems as well. Most recently the 1.8 G5 iMacs have had thermal issues. On a software front, Apples updates have caused serious problems on a couple of occasions in the last few years. Pretty sad considering Apple knows every single machine and it's shipped configuration. The real kicker is that Apple doesn't seem to care. Getting these issues resolved have caused end users time and money because of slow apple response, and poor policy making (high restocking fees, hidden part return deadlines). My point in all of this is that Mac users have to put up with this, and Apple has no market force to correct it. The reason? Apple has a monopoly on the Mac.
In closing this kind of thing can only last so long - I would argue that the speed with which the iPod Nano screen scratch suit was brought against Apple
... you count 'slithering out from under a rock'.