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EU Launches Antitrust Probe Into iTunes
Macthorpe writes "ABC News is reporting that the EU has started an antitrust probe into the way that Apple sells music on iTunes. As you can only purchase from the store of the country where your credit or debit card is registered, the price differences and availability differences between iTunes stores for different EU countries constitute a violation of EU competition laws which forbid territorial sales restrictions.'Apple spokesman Steve Dowling said Monday the company wanted to operate a single store for all of Europe, but music labels and publishers said there were limits to the rights that could they could grant to Apple. "We don't believe Apple did anything to violate EU law," he said. "We will continue to work with the EU to resolve this matter."'"
Realizing that they cannot compete with American (or Asian) tech companies, the EU once again tries to legislate to produce home grown competition. Tools.
Region coding, DRM, lawsuits...they are all just desperate ploys--putting fingers in the dike of inevitable change.
SJW: Someone who has run out of real oppression, and has to fake it.
Oh, the EU has fined so many companies for price fixing, I don't even know where to begin--Bayer & Chemtura, Siemens, Dow, escalator firms, Heineken, Aventis, animal feed companies, the Deutsche Post, many vitamin producers, Nintendo and, of course, the well known case of Microsoft.
...
I'm not saying that none of these fines are unjustified but I am saying that, if I may opine, the EU has been issuing a lot of fines. With this recent Apple one, it does seem as though Apple had no choice and if they aren't given an alternative to losing their contracts with record companies for the sake of running one Europe encompassing store, then I don't blame them. On the surface, the EU Commissions seem to be discouraging big businesses from selling things like XBoxes, PS3s or iTunes inside all of the countries. Is this a good thing or a bad thing? I guess time will tell
My work here is dung.
For once the EU seems to be applying one of the more useful laws they made. It always seemed wrong to me that you could blatently discriminate customers on the basis of their nationality. I don't think a judge is going to buy the "record labels made me do it" defence. IANAL, but I just cannot see how that's going to be an excuse.
I wonder if the WTO could also go after them for charging different prices to US and non-US customers. I know there are many other web stores that do that so that's probably allowed. I understand why a marketeer would like to have different prices for different areas but it is just hampering price transparency and free trade.
Within the US would you be allowed to charge someone from, say, NY a different price than someone from NJ? (apart from tax & shipping?) Would any US judge care if you said the record labels made you do that? I think they just price differentiated because they thought they could get away with it.
This sig is just as redundant as the rest of this posting
Last night, I had dinner at a friend's house. The family is from Italy. They had purchased for a nephew (in Sicily) an Itunes card and sent it over. He had just called yesterday wondering why he couldn't use the card in Italy. I told them that I had no idea as I would never purchase from Itunes, but that I'd investigate.
/. has the story I need and the answer.
I get into work, and voila!
Thank you slashdot - you've saved me some legwork.
The Kai's Semi-Updated Website Thingy
But "They told me I had to do it like this" doesn't really sound very compelling. You do business on foreign soil according to the laws of the land, and if the laws of the land say you can't change the availability of your product based on locale then don't just hide behind the music industry's rhetoric in order to make a quick buck. Do the right thing.
Also, fuck the RIAA.
UK iTunes customers currently pay 79p per track. That's the equivalent of around $1.50.
Oh, of course, DVDs are different.
...Apple might become a convicted Monopolist? Who will slashdotters be fanbois of now? What if google is also convicted of antitrust? Oh the humanity!
Yeah, and I can't buy anyhthing from iTMS Japan either. That's not Apple's fault, it's the fault of the record labels (and the media industry in general) that they want to carve up territories like that.
However, I suppose they do have a point in that according to EU laws, the same songs should be available in all of EU (I'll guess they aren't), and maybe the whole EU area should be treated as one region (with half a dozen primary languages). Again, if the music companies are telling them to restrict certain songs to certain parts of EU, it's the music companies. FTRIAA, etc.
#naabhaprzrag, #sverubfr-000, #agi-fcbafberq, negvpyr[pynff*=' negvpyr-ary-'] { qvfcynl: abar !vzcbegnag; }
Admittedly I probably don't know as much about the EU as I should, but the biggest question for me is what happens to all this money? Is it essentially garnered to ensure the bureaucracy lives on forever?
"It is a miracle that curiosity survives formal education." -Albert Einstein
Watching all these politicians and corporations and lawyers argue and cry. What a lame life they all lead.
Meanwhile, us pirates just download whatever the hell we want.
Ever since Microsoft bailed Apple out of bankruptcy in 1997, Apple has learned from the master. It's high time justice stood up to Apple's bullying.
One of the big problems with the EU is it's total inconsistency. It supports privileged cartels on the one hand and then hammers companies for operating in the same way but in a different market sector on the other.
Eg, if I buy a book from Amazon they will deliver it practically anywhere. Electronics from the same site are restricted to the country that the site represents.
I think the principle should be that something sells for the same price in a given format and can be delivered anywhere. There are too many artificial restrictions in the market place. Exceptions would be for instance having to pay more for a french version of a given piece of software or a film to cover localisation.
Despite being one of those socialist liberals that inhabit much of Europe. I am going with Apple on this one. I think given their current way of doing things, they would love to have one big iTunes for Europe, with one price in Euros, converted to the local currency in those bits of Europe that choose not to partake, but in this case I suspect if they didn't atleast try to prevent out of region sales the labels and distributors would come down hard.
Heres also hoping that all the iTunes stores get the non DRM stuff, not just the USA one for the first x months/years.
Come as you are, do what you must, be who you will.
"the company wanted to operate a single store for all of Europe, but music labels and publishers said there were limits to the rights that could they could grant to Apple."
/sarcasm.
You can buy CDs from Germany if you're in the UK, so what's the problem? Since when has the music labels and publishers been above the EU law? They aren't, which is why any music store in the EU can sell to any person in the EU. Amazon manages it, so can Apple.
Or is this just another Apple excuse?
Like the one where you can buy DRM free music but only if you pay more and buy the higher quality version?
So pay less, but put up with the iPod lock-in, or pay more and get quality beyond the level you can hear and files twice as bulky. OH THANK YOU THANK YOU MR JOBS FOR NEEDLESSLY TYING TWO UNRELATED THINGS TOGETHER TO FOOL CONSUMERS! I am totally fooled.
I for one applaud the EU for enforcing their monopoly regulations against Apple. About time. I know I will be modded down as a troll for this, but I hope this action helps to open the eyes of the average slashdotter (ie pro mac, anti MS) that even though they have different public relation campaigns, both companies are now in the same boat and very similar in their business practices.
Oh, also, neither company is a monopoly; since there is competition, they should be regarded as oligopolies.
Why does that reply from the Apple spokesperson remind me of Microsoft in most of it's antitrust cases?
I am a Mac user. I find the Mac culture is often blind to how Apple isn't really different from Microsoft. Like most corporations, you want complete market presence and world domination. Unfortunately this means that smaller EU companies don't have much power unless laws exist to keep the big guys from doing as they please
[J]
mod me up, mactards!
I think Apple has the taint of evil for it's pushing of DRM and lock in's to it's hardware.
I think the EU is silly for how it tries to legislate things, and often causes itself undue issues.
Who am I supposed to be snarking at on this topic?
I'm a fiscal conservative, it's a pity we don't have a political party anymore
The EU certainly seem to have a hate-on for a lot of corporations these days.
Blerg.
Say what?
Levying fines is a lot easier than the EU getting off their ass and actually, you know, rescuing those 15 EU citizens illegally captured by the Iranians. Or at least maybe talking about maybe doing something... maybe.
Comment of the year
What is not clear from the article, is whether it is the music companies driving the division, or if it is Apple. If it is the music companies, they are the ones the EU should be looking at. If it is Apple, then... if it is both, that is collusion. It doesn't help that Apple has yet to respond to the EU's questions. That might clear up a lot of stuff. In the meantime, Appleytes can gather and press for boycotts of EU goods if they like, but it would help if Apple responded to the EU's request for information.
Often if you don't respond to courts, government organizations etc, they threaten to fine you etc.
How is this hard to understand? If I want to buy music in the EU then Company A can't sell it to france for say 99p and then prohibit me from buying from their french store forcing me to buy it in the UK one at £1.29. I can goto france and buy a DVD bring it home and play it on my UK DVD player. Itunes store activily stops me from buying from the French store, its price fixing. Apple can talk about how the music store won't let them, well sorry thats the local law if you cant obey it then you shouldn't be doing it. The EU simply expects Apple to let me use the french store and the frenchies use the UK store, it doesn't expect EU members to be able to access non eu member stores. So I still won't be able to use the USA store, I don't know about you but I think price fixing is bad, this is deliberate price fixing "because the record company's are forcing us" if thats the case I'd expect a anti trust case against the record companies next.
The case - European Comission (EC) v. Apple v. RIAA - in my head immediately was associated with good old movie.
The bad, the good and the ugly.
Badness of EC with all its accounting fraud mess is certain. Goodness of Apple is questionable, but in the party it definitely stands out. RIAA is part of deal since Apple here is retailer only (though still as retailer may bear responsibilities before consumers). And "ugly" is only descriptive adjective I can find for RIAA.
All hope abandon ye who enter here.
Actually with electronics, there is another issue. Electronics have to be approved (in a lot of countries at least) by various regulatory agencies. In the US, electronics have to be certified that they meet the FCC guidlines for RF emissions. And sometimes products only have the approvals listed on them for the country they're manufactured for. (Different model numbers for some countries would be one of the causes for this.) And of course there would be the power cord and possibly voltage issues.
For these reasons and others, it makes sense not to ship electronics into other countries. Although one would hope that eventually the EU would make the regulatory approval process be an EU thing instead of a per country thing there.
Surely the EU should read some fair and unbiased sites like RoughlyDrafted to learn that it most certainly is NOT a monopoly! And they should realize the RIAA is extremely evil!
(Okay, so the last sentence I can't say without chuckling at the blatant karma whore, that I've seen in this thread a few times.)
1) Its not about coding. Having different release dates in different languages would be fine, even within the EU.
2) Its not about DRM. Locking to players may or may not be OK in the EU, but its a different issue.
3) Its not about having the same price. No-one says you have to sell for the same price everywhere.
4) Its not about Apple being forced to do things by the record companies. It doesn't matter who wanted it or didn't.
5) It is not the same as buying stuff in Japan and the US, because, you see, Japan and the US are not part of a single market established by treaty and with a transnational body, the Commission, regulating conduct of companies.
What is it about then?
It is unlawful in the EU to restrict imports and exports from one country to another, because that is in restraint of trade and anti competitive. You can sell it for 600 in Germany and 300 in France. But what you cannot do is prevent the Germans from buying the stuff in France.
Consequently, it makes no difference what the record companies or Apple think or say to each other. Apple cannot enter into an agreement to restrict sales from its UK sites to UK cardholders. If it did sign such an agreement, it is unlawful. It will have entered into a conspiracy to commit anti competitive behaviour. Along with whoever it signed the agreement with. They will both be fried for it. If it just did it off its own initiative, only it committed the unlawful acts. If it really did.
So please guys, stop blaming the record companies and exonerating Apple, its all irrelevant. We have, allegedly, one or more parties engaged in anti competitive practices which are unlawful in the EU. If so, one or both are going to get busted. Whoever instigated it is irrelevant.
If you want to get a better handle on it, think violating FTC rules on interstate commerce in the US.
So are they now going to go after Amazon.co.uk for refusing to sell me (in Italy) electronics? The fact is that corporations always have, and always will, do what they can to restrain free trade (DVD region coding, anyone?), while at the same time the politicians they've bought and paid for are telling us we should fall to our knees and worship the free market and its magic, invisible hand.
If I were Apple I would want one store - worldwide. Good luck with that.
Science fiction for grown-ups...
Lars T.
To the guy who modded me down from perfect to terrible Karma - Apple haters still suck
Apple is claiming that they cannot distribute the music because the actual labels have agreements in place that only permit certain music to be distributed in certain countries. While this is true, the EU knows that under WTO rules, this practice is no longer defensible. Sure you can write a contract that makes the restriction, but it can no longer be enforced. The same with DVD region codes.
Companies that distribute for media companies, produce players and software, etc that enforce various region-based market segmentation strategies are, in their mind, complicit in engaging in restricting free trade. Apple knows that the rules allow them to distribute to provide a single global store for all customers in WTO signatory countries (which includes the US, EU, Japan, etc.), but doesn't. Apple doesn't do it, not because they can't, but because they don't want to to anger the labels that provide the actual content. While they couldn't be sued for ignoring the locale of the customer and distributing freely among the various countries, the labels would probably yank any further cooperation in retaliation.
Apple's between a rock and a hard place.
A similar situation exists with DVD region codes. Despite the fact that they are no longer legally enforcable, and outright illegal in certain jurisdictions, hardware manufacturers and software developers still support them. Why? So they can maintain a positive relationship with the media industry that still demands it. Meanwhile, most vendors make their products easy to modify to be made region-free (what the consumer wants).
It would have been much easier if the WTO explicitly outlawed regional segmentation of markets. The way it is worded make it so it's still legal to do, but any attempt to "enforce" such artificial segmentat or make others respect same is not permitted. I guess that's a way of saying that you can choose not to sell in a particular country, but you can't refuse someone the right to distribute or use your products (after they legally obtain them from you) in another country.
Apple bitches love getting "probed"!!
Despite the image based on what US-based news outlets report to you, the reality of things might be somewhat different. EU based companies aren't getting away scot free, it just happens that sales restrictions across member state borders and blatant disregard for the law are a few of those things that the union doesn't look upon very kindly.
The current way the iTunes Music Store operates with territorial sales is clearly illegal in the European Union which is based on free flow of goods, services and money. This is one of the most fundamental reasons for the existence of the EU.
On the other hand Apple would not be able to run the music shop if they hadn't agreed to operate in this way due to refusal from the record companies.
I assume that Apple knew full well that the current way was illegal and started operating like this anyway. They were either prepared to pay some fines as part of the cost of doing business, or they believed that by the time the EU started fining them they would be in a much stronger position to force the record companies to agree to operate legitimately. The last reason is IMO quite morally acceptable, but still illegal.
...when you sleep with dogs, you get fleas!
There is a war going on for your mind.
It really sucks to be in Apple's shoes right now, but in some ways, it serves them right for making a deal with the devil.
Apple didn't have much of a choice. If they would have followed the law, they would have been in breach of contract and brought to court in a lawsuit. But by following their contracts, they end up in court in violation of some anti-business law.
Really sucks to be them.
My Sysadmin Blog
Have you ever looked into the situation. It has been years since the EU ordered the different music licensing cartels across Europe to offer a single, pan-european license and those record company groups have ignored them. Now they're demanding Apple charge the same amount in different countries, when Apple pays a different amount in different countries
Yes, I have looked into the situation, but you obviously haven't, since you completely fail to understand what this case is all about. Apple can charge whatever the hell it wants in each individual country. Want to charge the two euros per track in france and four in germany? Fine.
What the commission is complaining about, and what may very well be determined illegal under EU law, is restricting the sale of French priced tracks only to people with credit cards issued in France. That's what the case is about. If iTunes France wants to charge half the German price, that's fine, but they are not allowed to stop people with German issued credit cards logging on and buying tracks. The EU garuntees free movement of goods, services and people between its member states. Shutting out consumers based on where their cards are issued may well be in violation of this.
Now, you may disagree, and think that imposing this restriction is not in violation of EU law. Fine. But you are grossly misrepresenting the situaton by claiming the EU commission wants Apple to charge the same amount in every country.
Incidently, I agree with the commission on this one. I think refusing to process a credit card tranaction because the card was issued in a different EU state is probably a violation of the single market regulations. In the end, of course, that will be for the courts to decide.
"I realise this is not a very popular opinion but it's the truth, and there for needs to be said" -Bill Hicks
Apple know full well that if a contract clause is unlawful, they are under no obligation to abide by it. And it seems pretty clear that any clause the music publishers put in about market segmentation within Europe is unlawful. Their legal guys should have spotted this years back.
King Khazunga: You must be very very young my dear.
eldavojohn: Man.
King Khazunga: Man, sorry. What knight lives in that castle over there?
eldavojohn: I'm 24.
King Khazunga: What?
eldavojohn: I'm 24. I'm not very very young.
King Khazunga: Well I can't just call you "my dear".
eldavojohn: Well you could say "eldavojohn".
King Khazunga: I didn't know you were called eldavojohn.
eldavojohn: Well you didn't bother to find out did you?
King Khazunga: I did say sorry about the "very very young my dear", but from behind you looked...
eldavojohn: What I object to is you automatically treat me like an inferior.
King Khazunga: Well I am king.
eldavojohn: Oh, king eh? Very nice. And how'd you get that, eh? By exploiting the workers. By hanging on to outdated imperialist dogma which perpetuates the economic and social differences in our society.
My work here is dung.
This is called "due diligence" to prevent contributory copyright infringement charges leveled against Apple.
The EU garuntees free movement of goods, services and people between its member states. Shutting out consumers based on where their cards are issued may well be in violation of this.So here's the problem. The right to copy a song onto your personal computer in France is considered, under EU law, a different service than the right to download that same song onto your personal computer in Germany because the right to copy it (copyright) is enforced separately in each country. So if Apple did not restrict the sale of a song from the French store to people with a French credit card, then sure a German could purchase the copyright with their German card, but assuming they are in Germany, it would be illegal for them to actually download the song in Germany, because their license to copy only applies in France and they aren't in France.
Your mistake is trying to equate a download with a CD, when those two things are treated completely differently by EU law. Under EU law, you cannot transfer a copyright (download license) in one country to another, while you can transfer a copy itself (CD).
Now, you may disagree, and think that imposing this restriction is not in violation of EU law. Fine. But you are grossly misrepresenting the situaton by claiming the EU commission wants Apple to charge the same amount in every country.The EU commission is bringing charges against Apple for selling what EU law defines as different services, for different prices. The problem is most of the people involved only understand things in terms of analogies, like CDs and don't understand that the problem is with EU law and the recording industry's exploitation thereof. Apple has exactly zero power to solve this. If they did as you suggest, they'd simply be misleading people into thinking they had a legal right to download a song, when they almost certainly did not, and as a result Apple would be liable for damages because of their knowingly profiting from this illegal behavior.
Incidently, I agree with the commission on this one. I think refusing to process a credit card tranaction because the card was issued in a different EU state is probably a violation of the single market regulations.It is entirely probable that it is a violation, technically. The problem is that accepting payments from foreign cards is also probably illegal. The EU has created a situation where selling music downloads online, is probably illegal no matter which way Apple chooses to do business. All of this, however, would be a moot point if the EU would simply enforce their own edict that requires the recording companies to offer to sell Apple and everyone else a single license at a single price that applies across Europe, so that the copyright license in Germany and in France were the same service. Right now, under EU law, they are not.
Mod Parent Up!
If that's the case, then why doesn't EU go after RIAA? Why come after Apple which is only a re-seller which does not own rights.
As per existing contract law and sale law, the consignee cannot be held for a consignor's or owner's illegality.
Apple is just an intermediary.
After all UK propounded modern law, don't they know it?
I think EU is delibrately targeting US companies. They don't target chinese or japanese companies, or even Arcelor/Mittal combo.
The US should start investigating AirBus and Volkswagen for anti-trust, and sic the RICO on them.
Mod me as flamebait or anything, i have karma to burn, but i still think EU is targeting US companies, while bush-idiot is warmongering with his single digit IQ elsewhere.
"Doing what i can, with what i have." ~ Burt Gummer
Um, Churla, RTFI.
That interview was from back when the iTunes Music Store opened.
What is likely to be illegal here is the record company's action in issuing such restrictive licences. Under the single market, a licence good in one member state should be good in all.
Real Daleks don't climb stairs - they level the building.
What I don't get is what constitutes a "store"? Most likely all of the ITMS' run from one or just a few locations, so if you log into "ITMS France" or "ITMS Belgium" you're really in the same "store" anyway. Then, when you download the files come from another webserver.
Couldn't Apple just have file servers in each country and serve you the file based on the address of your credit card? This way they could offer the same price to everyone but still not upload their files across country borders.
Not only that, the credit card must also have a billing address in the same state as it is issued, something I found out the hard way when I moved to the Netherlands from Sweden. iTunes is in both states, but I was not allowed to shop from any of them.
I could not purchase music in the Dutch store as my credit card was issued in Sweden and I could not purchase music from the Swedish store as the billing address had been changed to be in the Netherlands.
So, in the end I decided to download the music with bit-torrent. I still buy a lot of CDs, but when the music is difficult to find in a store near-by, I go to bit-torrent.
So, if anyone in the music industry is reading this. I do want to pay for the music, but when you start fiddeling with trying to block trade over the state borders within the EU, I as a European (and I am more and more identifying me as only European and not Swedish), get rather pissed, and blimey, you just lost a lot of profit.
I did complain about my situation to Union authorities, glad to see that they are finally doing something about it! In the new Europe, the music industry have to rethink, a lot of industries have to rethink actually. It is also a good thing that the Union is doing something that is obviously good for it's citizens in a directly observable way (this is not the only thing, I can think of the EUs recent fighting with the mobile phone carriers about the ridiculous high roaming charges).
"Civis Europaeus sum!"
Your mistake is trying to equate a download with a CD, when those two things are treated completely differently by EU law. Under EU law, you cannot transfer a copyright (download license) in one country to another, while you can transfer a copy itself (CD).
I don't believe I did any such thing.
So here's the problem. The right to copy a song onto your personal computer in France is considered, under EU law, a different service than the right to download that same song onto your personal computer in Germany because the right to copy it (copyright) is enforced separately in each country.
Bang on. Apple have stated that this is the advice that they recieved from their lawyers. Obviously, someone at the EU commission has a different opinon. Probaly they're thinking something like this. When I buy a track on iTunes, Apple sell me license to download a given track in, say France, in accordence with French copyright law. Now, what, exactly, is stopping them from also granting a license to do the same thing in Germany? Why not just grant a pan-EU licence, outlining the restrictions in each country and stating that the purchaser must obey the restrictions of the country they are currently residing in?
For what it's worth the EU has, for a long time now, been trying to harmonise it's copyright laws amongst its member states. That was one of the original intents of the EU Copyright Directive.
"I realise this is not a very popular opinion but it's the truth, and there for needs to be said" -Bill Hicks
I would find this a lot less disingenuous if it weren't a second American tech company that were being investigated right off, rather than a company in a different market sector or a non-American company. This smacks too much of "We got money from Microsoft, so who else can we get it from?"
Of course, maybe they have worked against companies as large in other market sectors, or from other nations, and it simply doesn't make the news over here. But I'm skeptical. It seems too much like the state DA's visible money-grabbing that goes on in a lot of the US, to look good on the records of wanna-be politicians and bring extra money into state budgets that's been paid largely by the consumers in other states of the products or services of the company they're going after.
Suppose some company operating in the US, a retailer, was supplied by an overseas company who insisted that there be no sales, or only sales at double the price, to certain ethnic or religious groups. They signed an agreement. After all, they wanted to sell the products. Or maybe they just did it without a written contract.
Do you think this would be either legal or excusable? Would you be all running around complaining about how Federal action was targetting overseas companies or whoever?
This is what is alleged to have happened. Apple is alleged to have signed contracts, or anyway decided, to operate a retail policy, which is contrary to the law of the jurisdiction. Don't do that. Just don't do it. Nothing else matters.
Does this make it a bit clearer?
Those who observe that the record industry is the big problem here have it absolutely right. The magic that allowed the iPod to succeed was one part marketing and three parts contract writing. The only way they could succeed was to sell downloadable music for a little as possible while avoiding lawsuits from the record industry. They succeeded in this brilliantly, but in order to do so they had to accept contract terms, including DRM and other things, that they would have preferred to avoid.
In the fundamentals of the lawsuit, Apple appears to be stuck between the rock of the record industry contracts and the hard place of EU policy, but the EU has the ability to do something that Apple can't do, which is to declare specific provisions of Apple's contracts with the record companies to be illegal such that Apple can ignore them. Apple can't ignore them on its own. To do so would simply make them liable to the record companies. It needs a judge to tell them they can do so on legal grounds. If Apple wants to run a single store in Europe, the only way it can do so is to have the European courts clear the way.
So if I'm Apple, I want to be sued by the EU over this one; I want to be cooperative; I want the EU to understand exactly what I need it to do to satisfy their requests.
To bad a similar suit can't apply Apple to back out of its DRM contract provisions.
Davis http://davis.foulger.net
Regulate everything you can to death. Thats probably why we see so little new technology coming out of EU.
Agreed, but the EU does not have any specific law regarding copyrights that requires this, which it almost certainly should. Also, many (most) of the licenses predate the existence of the EU. What happens with those? Finally, the original post was claiming Apple was culpable, but they are the only one in this whole situation with no real ability to do anything about it other than complain to the EU, which they did.
IANAL, so I feel like I have to ask-- when you purchase something online, legally, where does the transaction take place? Like if I'm sitting in NYC and I buy a music track from a French store, is that purchase subject to French laws or American laws?
It seems only tangentially related, but I wonder if this is the real issue here. Let's imagine Apple is licensed to sell a song in Germany but isn't licensed to sell that track in France, not under any price. Now, someone in France buys that track in the German store. If that transaction is said to take place in France, then Apple is guilty of copyright infringement.
The reason I ask is that this problem keeps popping up again and again. This was the question about allofmp3.com: if the sale is legal according to Russian law but illegal according to American law, is it legal for Americans in America to buy the music from a Russian store in Russia.
Are these legal issues even worked out and solidified yet?
Apple is in a tough position here. On one hand, their retail customers "have the right" to purchase iTunes in any other EU country and pay the prices listed in that country. ie: a German customer can go to the French iTunes site and buy a song cheaper than he could in Germany, for example.
This is what the case is about. Apple says they can refuse to sell to that German customer because they'd like him to buy from the German store (that, presumably, has higher costs than it's French counterpart). The EU says they MUST sell those French iTunes to that German customer because of anti-trust.
All of this ignores the fact that the licensing for those songs is different in each country (ie: costs differ by country).
So, just like the California Electricity market a few years back -- they want Apple to, essentially, sell at one price while the wholesale costs (ie: licensing) vary. California declared bankruptcy because of this very issue. They froze retail electricity rates for consumers. But didn't freeze any wholesale rates. And the wholesale rates went crazy (note: not going to get into the market manipulation issues here - Enron, anyone?)
Nobody can stay in business in this situation. Its better to just leave the market all together than to be forced to sell songs at a loss (because of the varying wholesale costs). If you can not predict your costs, and you have to sell at a fixed price --- then you won't last very long in that business. Econ 101.
Apple is not the rights-holder. How could it grant such a license unless the rights-holders give it the power to do so?
True enough, but not the EU's problem. "My contract with my suppliers prevents me from doing business in a legal way" is not a defence. Renegotiate your contract, or don't do business.
"I realise this is not a very popular opinion but it's the truth, and there for needs to be said" -Bill Hicks
Both to some degree. Thus far court precedent has said that if you offer a download, then you have to abide by the laws where that download is downloaded to, provided you can reasonably be expected to know where that is. Since Apple is billing via credit card, they know both the credit card issuer's country and the billing address of the customer, so they cannot claim ignorance.
Let's imagine Apple is licensed to sell a song in Germany but isn't licensed to sell that track in France, not under any price. Now, someone in France buys that track in the German store. If that transaction is said to take place in France, then Apple is guilty of copyright infringement.Right, and because Apple knows the CC info, they restrict downloads based upon that info so that the laws in the country where the content is downloaded to are followed (and where they are being paid from and have the greatest liability).
The reason I ask is that this problem keeps popping up again and again. This was the question about allofmp3.com: if the sale is legal according to Russian law but illegal according to American law, is it legal for Americans in America to buy the music from a Russian store in Russia.Technically, no one was able to show how allofmp3.com was illegal, so instead they used political pressure to get the Russians to shut it down. Allofmp3.com won all their lawsuits that I ever read about.
Well again, IANAL, but I read an article a while back written by someone claiming to be a lawyer specializing in IP issues. The author claimed that the law was a bit hazy, but that technically allofmp3.com was probably legal. The key question, he claimed, was whether the transaction was said to take place in Russia or the US. If it was sold in the US, the sale was contrary to US copyright laws and therefore illegal.
However, they copying was done in Russia and in accordance with Russian copyright, and therefore legal. If the sale is said to have taken place in Russia, then the sale was legal. Then the question becomes whether it's legal for US citizens to import the product for their own personal use-- so if you bought a CD while on vacation in Russia, would it be legal to stick the CD in your suitcase and bring it home. The author said it was legal. Therefore, according to this guy (random guy claiming to be a lawyer, but who knows), US citizens would probably not be committing a crime to buy songs from allofmp3.com.
No. Apple doesn't say they can refuse to sell to the German customer. They say to comply with German law they must refuse to sell to the German customer. The license Apple negotiated with the record company in France only gives them the right to copy that song within France, not across the border and into Germany. Since Apple has the credit card issue country and the billing address for that card which are both German, Apple has reason to believe the customer is in Germany and their providing them with a download under the Spanish license is blatant copyright violation. German law makes it illegal to publish a copy for download without the record company providing a license within Germany, which is not the license in question.
Exactly. In other words, Apple is protecting itself by refusing to sell to the German customer I mentioned above. (I just summarized but I do understand the details you lay out so thanks for providing the additional background)
I know many people in the UK working in France (on more or less permanent assignment for a company for the last 8 years). I know one French citizen who spends > 1/2 the year in Italy. Although I don't know this specifically, I'm guessing they have credit cards based on where they are living (and their nearby bank) rather than one arbitrarily issued by their country.
In the US I know many so-called green card holders (the card is really pink colored). They are not US citizens, but I know specifically nearly all have credit cards issued by US banks (since we go to the same bank).
Despite the idea of nationalistic pride, there is a very big difference between distinguishing against nationality and race or religion. This is true even in the EU. I'm not saying it's legal or not (that's a legal issue), but from a practical and moral point of view, it's not the same thing.
There's nothing stopping people from getting a credit card from a bank in another country in the EU is there?
You don't get anything delivered to a street address with music downloads, and you can certainly pay your bills on line so what's the problem?
Or perhaps the EU just hasn't gotten around to charging banks in the EU with antitrust yet discriminating against their nationality as to providing banking services...
"Our current view is that this is an arrangement which is imposed on Apple by the major record companies and we do not see a justification for it." - European Commision spokesman Jonathan Todd, April 3, 2007.
Here's the headline from the Reuters news service story (via Yahoo): "EU says record firms force iTunes to limit access."
.... your powers of comprehension?
In a single market (as the EU is) a company is not allowed to differentiate pricing.
The law was there before the apple, so to speak.
IANAL but write like a drunk one.
The point is that if you buy via iTunes in Europe there seems to be egregious violations of EU law.
Apple is the obvious responsible for this, but if they can show they have been coerced into this I am sure the blame will be squarely placed where it belongs.
IANAL but write like a drunk one.
The horror.
Look buddy, let us know when the US drops agricultural subsidies, allows European Airlines to fly US internal route and to own more then 49% of US comapnies and so on and so forth.
YOu are a case of a very black pot calling a kettle black.
IANAL but write like a drunk one.
.... most likely was wrong and a misrepresentation of the facts to please proto fascist UK readers.
IANAL but write like a drunk one.
Any other in region 5?
IANAL but write like a drunk one.
Copyright laws are applied at the national level, there is no single copyright agreement at the EU level.
What this means in practice is that copyright holders can prevent you copying from a server they don't want you to copy from, and they would be exercising their current legal rights.
The EU has to sort out this by at the very least setting a minimum standard of wha copyright can and can't cover in the EU (it should for starters guarantee the same rights in all countries for the consumer....).
IANAL but write like a drunk one.
The EU is not in the bussiness of imposing different copyrights in different countries. The labels are. They could simply say that the rights are the same for all purchasers whitin the EU regardless or the store used and their location.
Now, hopefully, they will get thier asses busted for their griddiness.
IANAL but write like a drunk one.
I have bought stuff from amazon.de, I am based in the UK, had no problems so far.
I have also bought stuff from Spain and France, some more forward looking shops just stablish an European presence and send stuff anywhere in the EU.
IANAL but write like a drunk one.
True enough, but the laws conflict, hence the need for the EU to harmonize copyright.
Rubbish. THe laws may conflict, although Apple have yet to specify how, exactly, but that does not prevent the record companies issuing a pan european license. Besides, I don't even buy that as the problem. Remember, if I'm in France with a German issued credit card, I can buy from the German store. Why aren't they worried about that? There is nothing stopping Apple from issuing pan europena licenses, except for the record companies. so, if you can't do business legally, don't do business.
"I realise this is not a very popular opinion but it's the truth, and there for needs to be said" -Bill Hicks
If at first you don't succeed, skydiving is not for you
The copyright issue pertains to downloads, not physical sales, because it has to do with the legal right to download a song file and save it on your machine. Apple cannot by itself declare that you have the right to do this. That is up to the rights-holders.
Your assumption here is that the law is clear, but the laws are in conflict so it was not so clear. The EU has decided the arrangment is illegal very recently. The record companies are vigorously disputing that. It seems obvious that laws have yet to adjust to technological change. This kind of thing happens all the time. Until the laws adjust, there are a lot of grey areas. Apple happens to be a pioneer in this area, but the same issues would arise regardless of which music retailer came first, and I think it would be silly to just sit on the sidelines and wait until the law gets clarified.
Today, there is a story on CNet that sheds some interesting light on this debate. It is clear from the story that the EU Commission sees the record labels as being the source of the problem and that the current situation is not one of Apple's doing. That makes sense. Here are some relevant quotes:
Full story here: http://news.com.com/2100-1027-6173093.html?tag=tb
The copyright issue pertains to downloads, not physical sales, because it has to do with the legal right to download a song file and save it on your machine. Apple cannot by itself declare that you have the right to do this. That is up to the rights-holders.
I think you missed my point. I'll try again. Apple claim that record companies, under advice from their lawyers, will only allow apple to sell download rights in a single EU state, e.g. istore France can only sell the rights to download a song in France. So, why are they not worried about someone in Germany buying download rights from istore France with a French issued credit card? Under the current system that would be technically possible yet, according to them, illegal. Why are Apple and the record companies not concerned.
Your assumption here is that the law is clear, but the laws are in conflict so it was not so clear.
People keep saying that, but I have yet to have anyone explain exactly how the laws are in conflict. Can you explain it? The only possible "conflict" I can see might be if the copyright laws between , say, France and Germany differed, but even so, it should be possible to grant a licence to download in any EU state, with the proviso that you obey of all the copyright laws of whichever state you happen to reside in. The only people who seem to think this is impossible are the record companies lawyers. Funny how they came to the conclusion that the only legal course of action was the one which would earn the record companies the most money.
In any event, you can already connect to any itunes store, and download music from it, in any EU state. All you need is a credit card issued in the country the store serves. Now I have a friend from Denmark. The next time he's over here, he could log onto iTunes Denmark, and download a track. But he'd be in Britain. So would Apple be in breach of contract when he did that? Should I video him doing it and pass the evidence onto the EU commission?
"I realise this is not a very popular opinion but it's the truth, and there for needs to be said" -Bill Hicks