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Antitrust Suit Filed To Halt Apple 'Music Monopoly'
Dotnaught writes with word of an anti-trust lawsuit filed against Apple late last month. Information Week has the story, a suit charging the company with maintaining an illegal monopoly on the digital music market. "The complaint goes beyond software licensing politics and charges Apple with deliberately designing its iPod hardware to be incompatible with WMA. One of the third-party components in iPods, the Portal Player System-On-A-Chip, supports WMA, according to the complaint. 'Apple, however, deliberately designed the iPod's software so that it would only play a single protected digital format, Apple's FairPlay-modified AAC format,' the complaint states. 'Deliberately disabling a desirable feature of a computer product is known as crippling a product, and software that does this is known as crippleware.'"
Worse than that, "support" for WMA in a portable player chipset doesn't generally mean the hardware can decode it by itself. It means that the hardware has enough memory and enough DSP horsepower to decode it when combined with an appropriate software codec. This is a case of licensing or not licensing the WMA codec, not just the crypto. It would almost certainly have cost Apple money on every iPod to support even the unencrypted WMA. This isn't something you get for free just by using a particular piece of hardware....
I would also hardly call WMA support "highly desirable". Among Microsoft employees who have portable music players, the iPod market share is reportedly 80%. If it were so desirable, don't you think at least Microsoft employees would favor Zunes because they support WMA? I think we can safely establish that at least as far as consumers are concerned, WMA support is not desirable. As far as consumers are concerned, a WMA file, an MP3 file, and an AAC file are all the same thing as an AIFF file. Most consumers just don't care. Expecting a hardware vendor to pay extra money on every unit for a feature that few users care about is silly, and I can't imagine how much crack their lawyers must have been smoking when they took on such a frivolous case.
If they were doing something useful like suing for the right to sell FairPlay songs, that would at least make sense, but suing because Apple didn't pay to license the WMA codec is about the most asinine lawsuit I've ever heard of. This makes the SCO lawsuits seem positively sensible by comparison....
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The PP5002c used in the first three generations of iPod (and the PP5003 used in the fourth) does indeed decode WMA.
It also has a USB interface. But the first two generations of iPod don't.
The PP5002c can decode video. But no iPods until the fifth generation did so.
The PP5002c also had lots of other logic in it that wasn't used by Apple. I can't possibly see how this is supposed to be an argument that Apple was supposed to support WMA.
Another harassment suit. I hope it gets kicked out of court quickly.
From Apple's page:
Audio formats supported: AAC (16 to 320 Kbps), Protected AAC (from iTunes Store), MP3 (16 to 320 Kbps), MP3 VBR, Audible (formats 2, 3, and 4), Apple Lossless, WAV, and AIFF
Only one of the 7 formats is DRM'ed (ie. "locked"), and only 2 have any sort of Apple proprietary nature to them (Apple Lossless and the FairPlay DRM'ed AAC). They shouldn't be forced to adopt a competitor's DRM. And Amazon proved you can create an online service compatible with the iPod.
In short, they'll get thrown out of court.
E pluribus unum
Apple is not interested in paying royalties to Microsoft for WMA
Is that what the plaintiffs are asking as a remedy?
I think perhaps it's more about why there are no 3rd party iTunes stores?
Apple may have a better product than Microsoft but I'd be interested to know how the Sheman Antitrust Act applies differently to Apple than it did in The US vs Microsoft antitrust case when Microsoft excluded Netscape from its desktop. The question in law is how is Apple controlling the hardware and the content different from say Standard Oil controlling the product and the distribution system (i.e. the railroad). My guess is that this is not a trivial suit. A lot of people with ipods resent having itunes as their only option. I think that's what this suit is about. And no matter how you feel about Apple's right to exercise such control, the law on the matter may be entirely different.
The general music catalogs are available from other sources. It's not like iTunes/iPod prevents people from listening to music in other ways.
If you really examine the issue, WMA with DRM is the odd duck here, not iPod/iTunes.
So, what's the issue again? In a nutshell, iPod/iTunes is a relatively flexible platform on either Macs or PCs.
The IE-Microsoft-Netscape issue was about bundling IE into the operating system as an "inseparable" component. That along with a hundred other abuses surrounding Java, QuickTime, Real Media, bullying vendors, exclusive contracts etc. led to the conclusion that Microsoft was a treacherous monopolist.
Most of the stuff on
Microsoft had no monopoly in browsers when they started. Microsoft had a desktop OS monopoly. They leveraged that to kill a company whose product might, someday, indirectly have hurt their desktop OS profits. The specific leverage they applied was to sink massive resources into developing a high-quality browser, and ... not only give it away free, but threaten to hurt other companies dependent on them for making products that worked with Netscape. They lost money hand over fist on the effort.
The assertions above are not rhetoric. They're fact. Hunt up the words "malevolent" and "obsessive" in that link. When the Netscape threat was gone, Microsoft virtually abandoned browser development.
Apple had no monopoly on MP3 players or desktop OS's when they started. Apple used no leverage of any kind. They used high-quality industrial design and user-interface research, attention to detail, superb marketing and smart partnerships to earn their present spot on top of the market. They have not, ever, even once, stopped adding new capacity and features on to the iPod. The iPod has been phenomenally profitable since its introduction. Apple continued improving it at a torrid pace even when they had left the competition so far behind there essentially wasn't any, and they're still doing it today.
Here's the legal description of how Microsoft behaved:
and what the law says of people who behave that way:
and the prescribed penalties if the prosecutor decides to make it a criminal case (which he didn't):
Note that a hundred million dollars is and was chump change to Microsoft. They had a hundred seventy two times that much available in *cash and short-term notes*.
In short, "to monopolize" trade is not "to have a monopoly on a product". Publishers have a monopoly on distribution of books they publish. That isn't the same as monopolizing trade in books.
Apple have a monopoly on Mac OS X. They are not monopolizing trade in personal-computer OS's. They have a monopoly on iPods. They aren't monopolizing trade in digital music.
They law applies equally to Microsoft and Apple.
It's just that Apple didn't break it.
As always, all IMO. Insert "I think" everywhere grammatically possible.