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EU Commissioner Slams Music Lock-In

Nonu writes "EU Commissioner for Consumer Protection Meglena Kuneva has come out against DRM lock-ins like Apple's iPod-iTunes combo. Kuneva said she believes the tie-in that keeps music bought from the iTunes Store from playing on MP3 players other than the iPod was unreasonable. '"Do you find it reasonable that a CD will play in all CD players, but an iTunes song will only play on an iPod?" asked Kuneva. "It doesn't [seem reasonable] to me. Something must change."' The EU is in the midst of an effort to harmonize its consumer protection laws, and along with the question of DRM tie-ins it is also looking at mandating cooling-off periods during which customers could 'return' downloaded music."

26 of 293 comments (clear)

  1. The only real solution by daveschroeder · · Score: 5, Insightful

    The solution isn't standardized DRM. It's no DRM. The music industry (and apparently government regulators) want you to believe the only practical solution is the former. The real solution is the latter, for all the reasons Jobs outlined, not the least of which is that DRM will NEVER stop piracy and ALWAYS be able to be defeated.

    1. Re:The only real solution by daveschroeder · · Score: 2, Insightful

      Oh, I agree with you. I have a pretty good devil's advocate myself: in a world where electronic distribution becomes the norm, without DRM, how can content owners control releases and pricing in different market? For example, if a label feels that it needs to sell something in Fooistan for US3 that sells for US$18 in the United States, because that's what the market bears and that's how they've chosen to price it - which is their right - without some of the controls of DRM, how can the $3 version be restricted to Fooistan? When it's physical product, the answer is simple. When it's electronic, why can't I just buy it from Fooistan's store? Some people will say that import regulations and taxes could still prevent that, but then what enforces that? Something like DRM. What if content owners want to control release schedules in different markets, as is, like it or not, their right, as the duly recognized legal "owners" of the content? Now we have various controls (such as region codes on DVDs) that support this, in addition to sales price disparities, and so on. Without DRM, that process falls apart. Some people might say, "Hey, that's globalization for you. You wanted free markets, right?" Yes, but not so that it harms developing economies. The prices can't equalize overnight, and it's not fair to force prices down to a lowest common denominator. There are difficult questions in the no-DRM panacea. A lot of the answers will revolve around information wanting to be free and "old business models" dying (a lot of which is BS). The fact is that different markets bear different prices for the same products. You can't just remove the only controls, with their associated legal extensions, and expect everything to go along fine. Enterprising folks will set up stores in the "cheapest" nations or locales and sell globally. If there are no rights management or (enforceable) legal prohibitions to doing so, everyone will gravitate to the lowest price.

      That's what DRM is about. It's not about not being able to be defeated. It will ALWAYS be defeated. It's about having a control that has legal extensions that prevent people from, or punish people for, circumventing it. This means you can't legally then buy music from the Fooistan online store. You need to buy it from the US store, at the prices the content bears in the US, at the times the content owners choose to release it in our market. Even if you take out all middlemen and we have a magical scenario where artists all get 100% of the proceeds from their creations, you have to allow for the idea that they are the people who get to determine how their content is sold, where it's sold, when it's sold, and for how much it's sold. This means THEY may even decide it's best to sell it for $5 in Fooistan and $25 in Canada. Why is that not their right? You might say, "Well, it is, but I think I still get to buy it from Fooistan even though I live in Canada." How does that help? We can go in and out of all sorts of global and legal and political and philosophical arguments. But that's really what the general copyright and rights management issues come down to: control.

      And, ultimately, the owner/originator/creator/assignee of the content SHOULD fundamentally be allowed some control. That's not to say that the prevailing system is great, or even good. But the opposite situation where everything has no restrictions or licenses doesn't work either: What's to stop anyone from buying one copy of something and making X more copies? If there are no controls to enforce that; essentially, to create an artificial "scarcity" as some like to call it, what is to legally stop anyone from doing that? You can say there can still be a "law" against it, and so on. No, that won't fly. Sure, there can be a law. But you can never (easily) prove anything was circumvented, copied, sold, "stolen", or paid for when such a system is the status quo.

      Yes, there are a million exceptions people can nitpick about what I've said here. But the fact is, the issues are a lot more complex, again, than most people would like to believe.

    2. Re:The only real solution by Sam+Ritchie · · Score: 4, Insightful

      without DRM, how can content owners control releases and pricing in different market?

      I think that's the point - most traditional media organisations have not yet grasped the concept that for digital media, there's only one market. They're stuck on the idea that DRM is a convenient way to artificially segment the global market and apply their traditional means based pricing mechanisms. Most software vendors realised the futility of this years ago and, with relatively few exceptions, have roughly comparable pricing worldwide. Yes, this means products are less affordable in poorer countries. Yes, this means price gouging is limited in richer countries. Ultimately though, this means that poorer countries get a leg up in selling their own software/digital content - behold the beauty of the free market.

      Your assertion is that content owners have the 'right' to segment the market this way to maximise profits - I disagree. What gives them that right and why? They already have sufficient rights granted to them via Berne, WIPO etc to guarantee a worldwide monopoly on reproduction of their content. Where's the public interest in legal frameworks purely for enforcing variable price & availability depending on the physical location of the consumer? Does anyone validly believe Hollywood would stop making movies if they couldn't sell downloads to Fooistan for less than they sell to Canada without reducing the Canadian price?

      --
      This sig is false.
    3. Re:The only real solution by GaryPatterson · · Score: 2, Insightful

      I think the music industry would love the EU to force Apple to licence FairPlay.

      For them, the ability of other companies to sell iPod-playable music would be a complete win. In one fell swoop, they'd have almost total control back.

      Imagine - the industry puts a demand for variable pricing starting at $2 for older music and topping out at $5 for just-released music. The alternative is that they'll withdraw the licence to sell music. Apple might stand firm as they've done in the past, but they now depend on every other FairPlay licencee standing just as firm. If they stand together, the industry will be forced back to the table. If a single one caves in, the industry will have found the weakness they need to gain the upper hand. Suddenly that company gets all the music to sell, and companies who stood with Apple lose their contract.

      Licencing FairPlay is the worst possible outcome for consumers. It hands control to the music industry, maintains DRM and weakens any other attempts to change the online sales models. Consumers have been well served by Apple having strong control and keeping prices lower.

      The only point to criticise Apple on is their failure to sell music without DRM. I don't know if they'd want to do that on a band by band basis (might be difficult to manage) but they should be able to do this by label. I've heard rumours that the music industry might have forced a condition on Apple that every song must have DRM. If that's true, then it's a sad thing.

      Apple should strongly resist any attempt to licence the ability to sell FairPlay tracks.

      There may be a case to make that FairPlay should have a playback-only licence. That is, only Apple can sell the music, but you can play it on any licenced player. That situation would be diametrically opposed to Apple's mission here - to sell iPods. Even allowing other companies to sell music for the iPod maintains their basic goals, but allowing iTMS purchases to play on other players undermines Apple's business.

      Lastly, if the solution to the EU's issue is licencing, will the EU dictate the terms Apple must licence on? Will they oversee the negotiations? Will any changes only be binding to the EU iTMS? What if negotiations break down - will Apple be forced to negotiate against its own interests? The EU have raised a number of issues for which they're not putting forward any solutions. "Something must be done!" is always a handy vote-winner, but the real progress comes from the usually unsaid part - "... and this is the workable solution I've come up with."

  2. Wow.... Consumer's rights being advocated? by Fallen+Kell · · Score: 3, Insightful

    Probably not. But it almost appears that way. More likely politics on the issue that iTunes being an Apple product, and Apple not being an EU based company, while several other EU based companies *cough* Philips *cough* LG *cough* are not making any headway into the market which is completely dominated by Apple. While I personally love the outcome of the fight, i.e. someone fighting for removing of DRM. The reasons for the fight are suspect in my eyes.

    Why just fight against DRM for iTunes, and not DRM for everything? If the EU commisioner was really fighting for consumer rights here, it should be all DRM'ed anything, music, movies, electronic books, etc., etc., should be able to be universally used on any device. Which essentially means that it needs to be universal. Problem here is that as such, DRM can not work.

    --
    We were all warned a long time ago that MS products sucked, remember the Magic 8 Ball said, "Outlook not so good"
    1. Re:Wow.... Consumer's rights being advocated? by ClosedSource · · Score: 4, Insightful

      Ever noticed how the EU was perceived to be smart when it was punishing MS for behavior that might someday lead to a monopoly in server OS's, but is considered dumb when they attack Apple who has a monopoly today on portable music players.

    2. Re:Wow.... Consumer's rights being advocated? by Whiney+Mac+Fanboy · · Score: 3, Insightful

      GP: MS for behavior that might someday lead to a monopoly in server OS's

      Parent: How does Apple have a monopoly when I can walk into a Wal-Mart or Target and on the shelves right next to the iPods

      1) The parent specifically mentioned server OS's (where MS has multiple competitors in the market), other mp3 players don't count.

      2) Apple's supposed monopoly is in the digital music market, not the portable music player market.

      3) You don't understand what a monopoly is do you? Hint: It doesn't mean you have 100% of a market.

      --
      There are shills on slashdot. Apparently, I'm one of them.
  3. All of your concerns are answered here by daveschroeder · · Score: 2, Insightful

    DRM free music is the only true path to interoperability. Anything else will fall short.

    For the record, I agree.

    As to the oft-repeated response to Jobs' statement, I answer those concerns in one of my previous responses to another similar response. Summary: it is nowhere near as technically, legally, and procedurally as simple as people seem to think it is, and the fact Apple isn't doing it now doesn't mean Jobs' DRM statement was just PR fluff that they floated out because they "knew" they'd "never have to do it":

    They already store unprotected files on the server that are accessible from certain clients. I'm sure they probably thought of the eventuality that they could sell unprotected music someday, and if they have any sense they already have something designed and implemented. It is definitely a business decision and not technical limitations that are holding them back.

    Yes. And the business processes that go into rolling something like this out are probably far more complex than the technical processes. This actually speaks to my point: technically, sure, it may be that "2-3 day" operation people think it should be. From a business and support perspective, it's not. There may even be legal issues in one or more of Apple's other contractual relationships. This is the same as people thinking Apple should have been able to create an iPod battery replacement service in a week or two. In reality, it took the better part of a year. The point is that things are a little more complex and take a little longer than people seem to think.

    I never said he was in love with DRM.

    You didn't say that, but others making this argument essentially say that.

    The simple fact is that Apple does not sell songs without DRM, even though they have the ability

    You don't know that they have that ability right now. Just because the songs are stored unprotected on their servers doesn't mean they have the end-to-end business, technical, and logistical processes, today, to do that. I can just see people saying, "Please...how hard can it be?" It may NOT be "that hard". But it's a LOT harder than people seem to think it is. It's not as if they can just flip a switch. There are a lot of things that would have to happen at the back end to support this, not to mention a client update may even be needed.

    I'm NOT saying any of this is impossible, or that it would be "hard" for Apple to do, or that they shouldn't do it.

    I'm simply saying that using the fact that they're not currently doing it as some sort of "proof" that Apple doesn't really want to be rid of DRM is disingenuous.

    and many independent labels have requested to have their music sold unshackled.

    But how many of these labels have direct relationships with iTunes (i.e., not another intermediary)? I honestly don't know. Even if there are many, they, in total, comprise a very small portion (much less than "30%") and don't include any major labels. And the major labels - the ones who WANT DRM - are what's at issue here. I know that to some people, the converse situation of applying DRM to these other artists' music who may not want it stands as some sort of "proof" that Apple really isn't serious about ridding iTunes Music Store of DRM.

    If Steve was anti-DRM, then why does iTunes not have the ability to sell unrestricted music from those labels that want it?

    This is a legitimate question. Even if the number of people with valid rights to request this (i.e., people with direct contractual relationships with Apple) is very small, Apple should still enable this, even if only as a symbol.

    The answer is that they can make a whole shitload of money while still appearing

  4. Re:Burn The iTunes Tunes To CD and Rip Them Back by ereshiere · · Score: 1, Insightful

    That's not how it works--the artifacts are there when you download a song from iTunes, since they're encoded at 128k. Burning and ripping them at a higher bit rate doesn't improve anything.

  5. Re:DRM free music the only way forward. by tbo · · Score: 2, Insightful

    Thanks Steve - why not offer DRM free music from artists and labels that you already have granted you permission?

    The same reason Apple is opposed to variable pricing: consistency. They don't want to clutter iTunes with complicated explanations of what you are and aren't allowed to do with each track of music. Consumers will get confused and pissed off when Britney Spears will play on their Zune but Christina Aguilera won't.

  6. Re:no drm best, open drm better than nothing by Seumas · · Score: 2, Insightful

    That's not going to be enough as far as I'm concerned. Even if it were completely DRM free and open, it's still ten bucks an album. If I'm going to buy an album for ten bucks, I might as well just go get the physical CD and rip it myself.

    Also, what is the current cut that an artist gets currently? I bet it's not significantly greater than the point they get for physical media. Fucking the artist is still fucking the artist.

  7. Re:DRM free music the only way forward. by Anonymous Coward · · Score: 1, Insightful
    Thanks Steve - why not offer DRM free music from artists and labels that you already have granted you permission?

    It could be the contracts currently with the big 4 all read that all music sold through the iTunes music store is required to be drm encoded. Legally this also helps eliminate any possibility of something getting distributed as unprotected when it should be protected. It probably was the only way for apple to get the contracts. Or do you so quicly forget that the major labels didn't want ANY online distribution not that long ago?

    Why are you getting mad at Steve when the most likely reason this is happening is a contractual obligation? Or do you really think that Steve is the allmighty decider of ALL THINGS APPLE? (hint: even he has to abide by laws and contracts.) We have no access to these contracts and their stipulations. Blaming apple or the music companies at this time is premature. Although indications are that the music companies are the problem. Bitching at Steve Jobs over this is as useful as blaming Bill Gates for the DRM on the Zune. Sure there is a measure of guilt, but the decision was made to appease someone. And it wasn't likely Microsoft or Apple.

    The ironic thing to this whole bit could be that the music companies won't let their music be sold without drm. The eu says no to iTunes lockin, and thereby eliminates any market for legal music distribution (drm or not, ms/apple or not). This forces everyone right back to circumventing copyrights.

    Seems to defeat the point a bit there EU. Possibly cut off your arm because you can't find a glove exactly your size and the manufacturer can't make your size right now at all. But whatever.

  8. Re:Capitalist acts between consenting adults by ScentCone · · Score: 1, Insightful

    I say I'm an adult. If I want to buy a system that employs DRM, it's my god damn business.

    Well, you pretty much nailed it. Obviously this EU official thinks you can't possibly expected to be accountable for your own actions and decisions. For cryin' out loud, she wants a "cooling off period" for the purchase of an inexpensive bit of three-minute entertainment? Doesn't anyone understand how absurd that sounds? It's bad enough when people want to "cool off" on their 60" plasma TV purchase the day after the Super Bowl... but to imply that the government needs to protect people from the harm they might do to themselves by paying a dollar for a song from iTunes... incredible. Perhaps she'd like to propose a cooling off period for the people that voted for her? Surely they're regretting it. Or should, anyway.

    --
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  9. Re:Capitalist acts between consenting adults by Kristoph · · Score: 4, Insightful

    The government is stepping in to keep the consumer from harm and/or to ensure the market is functioning properly by attempting to regulate some degree of interoperability. The government has done this many times to very positive effect. In many cases such interoperability leads to much greater choice and much lower cost. If the government failed to do that choice would exist but it would be expensive and difficult to obtain because alternatives would have a significant market disadvantage. So, in summary, the whole point here is to give you choice, not to butt into your business.

    ]{

  10. Re:You appear to have replied to the wrong comment by daveschroeder · · Score: 2, Insightful

    You appear to have replied to the wrong comment?

    Um, no?

    Or perhaps this is a pre-canned comment you keep ready to drop on someone who says something anti-ITMS?

    Or perhaps I specifically and directly said it was a response to a previous similar statement, and even linked to that very response in my post, since it was directly on-topic and there was no reason to retype it all?

    Anyway, I'll reply to the bit that did seem to intersect my comment

    Actually, the entire response is on-topic, because it speaks to why Apple isn't necessarily already doing no-DRM for the comparatively very small number of artists with legal standing to request this.

    Artists have been asking for DRM free ITMS music for months. If Jobs was as concerned about DRM being imposed on him as his little blog makes out, don't you think Apple should lead by example and become the first label (let's face it, that's what they are now) to offer DRM free tunes.

    I spoke to that too in my response. And for what it's worth, I agree, if only to quiet all the people who think Jobs' statement isn't genuine, and/or stupidly believes that Jobs' statement isn't the gentleman's equivalent, in the corporate media and business world, of Jobs walking into a boardroom with both middle fingers raised high.

    Further, Apple may NEVER do this until it can be 100% across the board, like it or not, and we also don't know if one or more of the other major label contracts mandates that all music sold via the same store/mechanisms share the same controls. Even if the latter isn't the case, the former is still by far a legitimate enough reason for Jobs to not want to do it (e.g., why do some tracks I bought play on my Zune and others won't?). I know that a lot of people don't buy that argument, but frankly, it's perfectly legitimate.

  11. Re:Burn The iTunes Tunes To CD and Rip Them Back by karmatic · · Score: 2, Insightful

    You can still use allofmp3 - you just have to buy an xrost card and activate that. Yes, there are companies that take visa.

  12. Re:Capitalist acts between consenting adults by Kristoph · · Score: 2, Insightful

    Yes, suppliers have options, what's your point? If Apple stopped making iPod's someone else would make jPod's or kPod's or whatever because there is DEMAND!

    Anyway, I am not against DRM. I am just against vendor lock in of the stuff I bought. Actually I own a Mac and an iPod but I want the option of using something else in the future. In fact, I saw the sansa player, which I'd like to give a try, but there is no way to do that unless I do something deemed illegal to covert my music to a different format.

    ]{

  13. Re:Has she read Steeve Jobs' essay on DRM? by jmv · · Score: 5, Insightful

    Has it ever occured to you that the statements made by Jobs about DRM were *precisely* made because of what the EU's doing. It's the old proven method to deal with "you shouldn't be doing X" by responding "I don't like it either, but Y is forcing me to do it". In this case, both the music companies and Apple want DRM, for very different reasons. The music industry wants you to buy your music 10 times, while Apple wants to make sure it won't work on anything other than an iPod.

  14. Or if read backward... by bidule · · Score: 1, Insightful

    '"Do you find it reasonable that a CD will only play in a CD player, but an iTunes song will play on all iPods?"

    I'd love to be able to trade in my tapes for CDs. Or play Wii games on a PS3, or 360 games on a Windows box or even under Mac/Linux. Can I have a pony now?

    --
    ID: the nose did not occur naturally, how would we wear glasses otherwise? (apologies to Voltaire)
  15. Re:iTunes lock-in is a red herring by Technician · · Score: 4, Insightful

    How different is FairPlay from, say, Macrovision?


    With Macrovision, when I sell or give you my DVD, it will play in your player. It will play in anybody's player in the same region.

    What happens when you mail me your iTunes track?

    --
    The truth shall set you free!
  16. Re:You appear to have replied to the wrong comment by rtb61 · · Score: 2, Insightful
    I dare say that non-DRM music has a significant competitive advantage over DRM music and as copies of non-DRM music spread so would the popularity of the non-DRM music creators. So obviously the DRM music producers will not like non-DRM music competing with them at the same location, hence would be likely to put an enormous amount of pressure on distributors to ensure that it does not happen.

    Think of it from the 'artist's' point of view as a a pro DRM type, you are more likely to be seen a greedy, ass hat, weasel of a freak and about as far from cool as you possibly can be, whilst you know that your non-DRM competitor will be seen as really cool, some one who is actually into the music and not in it just for the money and cares about the fans buying the music. Can you see the problem now?

    --
    Chaos - everything, everywhere, everywhen
  17. Re:Capitalist acts between consenting adults by kocsonya · · Score: 3, Insightful

    Because this is the *same* government that grants the right of the music factory to charge for their product every time they make a copy for about one and a half century even if the actual cost of making that particular copy is practically zero and *anyone* can make that copy if they want. This is the same government which in some countries artificially raises the price of data medium and give a cut to the music factories because the medium is capable of holding music.

    In this case they do not do Big Brother things, they do not limit what you can do - it is actually DRM that limits what you can do and the various IP laws (by the government, actually). All they want now is that the music manufacturers can't squeeze you more than what the law grants to them.

  18. Re:It's peoples' own money by Guuge · · Score: 4, Insightful

    This isn't about preventing people from buying music from Apple's store. It's about Apple preventing competitors from developing better players for that music. Does Apple own a patent on music? Why should Apple be able to dictate how its customers use that music after they've purchased it? It's a classic example of a company using their dominance of one market to control another. Think about how you'd feel if Microsoft decided that the only browsers you're allowed to use in Windows are browsers developed by Microsoft. In this case, Apple decided that the only music players you're allowed to use for iTunes music are those developed by Apple.

  19. Price discrimination in the digital age. by Kadin2048 · · Score: 3, Insightful

    if a label feels that it needs to sell something in Fooistan for US3 that sells for US$18 in the United States, because that's what the market bears and that's how they've chosen to price it - which is their right - without some of the controls of DRM, how can the $3 version be restricted to Fooistan?

    Your conclusions are all right -- that such a scheme is impossible -- but I disagree with your premises, namely that doing such is a "right."

    You have the "right" to try and sell your wares at whatever price you wish, but others have a right to not buy it, and buy it from somebody else if they prefer.

    In general, you are a fool, if you try and sell a good in one place, at a price that's higher than what you sell it at in another place, plus the cost of transporting it from the latter place to the former. So, for example, if you sell records in Fooistan for $3, and it costs $1 to send a record from Fooistan to Baristan, then you will probably never be able to get much more than $4 for records in Baristan, because if you attempt to charge more, consumers will just end-run you, and have stuff shipped in from Fooistan, where it's cheaper. This is their right, and the sellers' right, under many historically-established doctrines, such as First Sale. (Which sadly no longer seems to exist in Great Britain, but that's a story for another day.)

    The fact that people in Baristan might pay a whole lot more than $4 for your record, if they existed in a complete vacuum (i.e. where the cost of transportation from Fooistan was infinite), is totally irrelevant. You have no 'right' to that price, because it's provably not what the real-world market will bear when it's connected to other markets. It might as well be ignored, because it doesn't matter.

    What computers do to information (among many other things) is make the cost of transporting it from one place to another, very, very low. So it ought to be basically impossible to sell a digital commodity in one place for a different price than you sell it in another, because people will just ship the files (at negligible cost) around your carefully-designed price-discriminatory barriers. In effect, cheaper communication and transportation (with information, these are the same thing) link the markets into one market, where there is but a single prevailing price for any fungible good. This is pretty basic economics here.

    The sellers of some types of information, particularly entertainment, have attempted to defy this by erecting technical hurdles which prevent information from being easily transmitted from one place to another. In effect, they're making it harder to transport goods, thus allowing a greater difference in price to be created in different regions. With DVDs, this is done with region coding and locking. With iTunes songs, it's done with a flat prohibition on resale, enforced by per-user licensing. But like all DRM, these are inherently flawed and thus surmountable; the fact that they can be worked around means that you can only charge so much more for content in various areas, before it becomes worth the trouble to buy it from some other area and bypass the blocks.

    --
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  20. Re:Has she read Steeve Jobs' essay on DRM? by mike2R · · Score: 2, Insightful

    Here we have living proof that "you can fool some of the people all of the time."

    Come on, it's lock in, lock in, lock in. It may conveniently tie in with some of the labels own ends, but this is all about making sure that iPod owners stay iPod owners.

    --
    This sig all sigs devours
  21. Re:Don't underestimate the music industry. by Whiney+Mac+Fanboy · · Score: 2, Insightful

    Neither I nor anyone else outside of the highest echelons at Apple can say for sure,

    Agreed completely. Nice to see someone who admits instead of just spouting their (or pundits') opinions. (I include myself in that).

    but I suspect that Apple has agreements in place with the major labels to the effect that all music sold through the iTMS will have the same DRM, regardless of where it comes from.

    Again agreed (along with the rest of your comment for the most part).

    BUT, if that is the case, Apple has to say something.

    They can't let the situation stay like this - with Jobs accusing the 'labels' of not allowing DRM free music, while acting as a label mandating DRM themselves.

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