I want to defend the UK record on these matters against what seems like rather unthinking criticism. The UK law is quite careful about making appropriate distinctions between different levels of offence.
It first distinguishes between acts of abuse, and images of acts of abuse.
Second, it distinguishes between different kinds of illegal content - it distinguishes between Child Pornography, which is contrary to the Child Protection Act, illegal pornorgraphy, which is defined in the Obscene Publications legislation, and plain ordinary legal erotic material.
Third, it distinguishes between possession and publication. The only material which it is illegal to possess is that covered by the Child Protection Act. Other material may be illegal to publish or disseminate, but not to own.
Fourth, it distinguishes between different channels and levels of access. Material which may be broadcast after the 9pm watershed on television may not be lawfully broadcast before it. Material which may appear in cinemas with an Adult rating may not appear with a universal rating.
Fifth, its distinctions are not solely based on sexual content. It also tries to control the dissemination of or access to other kinds of material, violent, racist - look at the Race Relations legislation. Look at the recent video game episode.
Its against this background, which is one of a legal establishment doing its best to treat different things differently, that you have to see the present proposals. Despite what people are saying here, its not clear that the proposal actually is that material which it is legal to publish is going to be made illegal to own. That seems most unlikely given the care with which these matters are usually approached. It also seems unenforceable. If its legal to publish, its legal to own. If its legal to own, it has to be legal to clip out sections. So if this is really in the present proposals, which is a bit hard to tell from the draft as published, it will almost certainly not be in the final version.
The difficulty they are having with drafting is a well meaning but probably mistaken effort to accommodate 'art' movies, in which material which would normally fall under the Obscene Publications legislation can be granted a sort of contextual exemption. A little as if Germany would give a contextual exemption to art films in which Nazi era footage appeared. However, the UK record recently on taking context into account is rather a good one.
The proposals do seem ill advised. Not because they unfairly discriminate or criminalize S&M devotees. Rather, because existing legislation is arguably comprehensive enough and fine tuned enough to make any further legislation unnecessary, or at least, it is comprehensive enough given fairly minor amendments. It would probably be better to review the material covered by existing legislation, and if necessary enlarge its scope. Also, blaming the Internet is thoroughly misguided of course - but the grieving will inevitably feel they have to blame something.
Do not just condemn the UK's approach to these matters out of hand without finding out exactly how they do things. Its a difficult area, they do make mistakes, particularly sometimes in enforcement, but on the whole the record is moderate, rational and praiseworthy.
Sorry, I meant to use 'you' in the sense of 'one' - not you personally. In fact I'm basically agreeing. I think many of the arguments used against the RIAA are because of peoples dislike of them, and that they would not be used or thought legitimate in a different context.
What is hard to understand is, why they thought it was sensible to tie the phone to one network. Evidently they did not need to do this to generate sales. So why did they not simply allow people to buy and register with whoever they wanted? The margins seem to be high enough, the demand was there? What was the point? In fact, would they not have sold more if they hadn't locked it to one network?
Its true they control the customers' network choice. But why do they care which network he/she chooses? Does anyone have a simple explanation of this?
I don't think we'd accept the WLAN and WEP breach defenses as reasons for not using IP evidence as grounds for investigation, search warrants and so on.
We probably would accept it, at least in some circumstances, with more evidence of WLAN and WEP breaches than the mere possibility, as constituting reasonable doubt about whether a crime had been committed. We'd require more evidence than the IP evidence - for instance, material on disk.
The difficulty you have with the RIAA is really four things. One, people think its a desperate defence of a dead business model. Two they think its trying to reduce rights which buyers had below what they had for physical media. Three they see evidence with potential technical holes in it being used. Four, they see the evidence which should only be grounds for investigation being used as if it would support the weight of prosecution without any more supporting material evidence.
The last point would probably be felt to apply regardless of the crime being investigated.
I do advise my friends who are renting out property with a built in wireless broadband connection to have a clause in the lease to the effect that WPA security is implemented on the router and may not be turned off, and not to give the strong admin password on the router. Of course, your tenants can reset and leave it open, but at least you will know its happened, and you have taken just about all the precautions you reasonably can other than putting the thing in a locked closet. But pity anyone who rents out a room in his main house, gives access to the broadband connection, maybe even wired rather than wireless access, and finds the front door being broken down at three in the morning. I guess its a case of 'know your customer'!
Well, since modded down to troll, Heaven knows why, with some trepidation one asks, how is it going to be stopped? It will be out there as a retail copy, it will not be an upgrade. It will boot and install in a macintel. Don't you think that in ten minutes there will be posted some hack on how to run it on any old similar spec Intel box? Or if not, how is it going to be prevented?
Yes, I know that non-DRM stuff is sold on iTunes. Of course it is. That's not the point. The point is the coding. Once you have bought your non DRM iTune, you can't play it on another box. My prediction is, the Universal thing is the beginning of the end of this, and within a year, it will be over one way or another.
Why this legitimate opinion should be labelled a troll by the resident fatwa issuers, Heaven knows. But there you go.
Simple really. They are not selling enough through iTunes to make it worthwhile. This is because iPod people do not buy many tunes. So they figure, we are losing more to piracy than we are making. Now, lets see, what if we sold non-DRM that would play on anything. Would that be better or worse? Probably better. We could hardly lose more to piracy than we are now. But why rush it? In the meantime, lets go month to month while we do a bit more research and see which way the cat will jump. And whether iPhone will sell.
Personally, I think its the first of the spring cracks in the ice. I don't think the iPod iTunes locked business model will last much longer. Like, not more than a year. Just like the locked iPhone model will not, and I think with Leopard we will see the locked OS model fall to bits. But we will see.
You have to ask what sort of numbers it would take to justify the hype expressed in the share price.
Right now the price/sales ratio is 5 (Morningstar, based on 2006 full year numbers). Revenues were around 19 billion to generate that ratio. So lets say they sell (round numbers) a million phones at 600 each, which would be 600 million in dollars. Lets say that the price/sales ratio is headed back to the historical norm for Apple of below 3. Let alone they fall to more reasonable numbers.
Question: how many would they have to sell for revenues to rise to levels where the ratio would be 'normal'?
Well, assume the price stays the same and revenues double. That would do it comfortably - and maybe leave a little room for growth in the share price. That would imply, if it all came from phones, around 30 million phones. There is no need to be more precise - its the general scale of the thing we are interested in.
So you see that selling a million is not really cutting it in terms of the expectation built into the price at the moment. What they needed to justify the price was lines around the block for a week. Not for an evening.
We can now expect to move to phase two of the bubble, during which the Apple folks tell us (a) sales are in fact higher than they look (b) they are going to pick up very soon (c) market share doesn't matter (d) market share is higher than it looks....
The stock price action will however tell the real story. If it goes up for the next month, we know its working. If not....watch out below.
We all seeming to make predictions, so here is one.
Yes there will be people camping outside. Yes, they will go for inflated prices on day 2 on Ebay.
Sometime around week 2. there will be no crowds.
By the end of week 3 the extra staff will have been laid off. Mac fans will be saying that anyone who says this is poor sales and below expectations is an Apple hater and knocker and in the pay of MS, and that sales will pick up in week 4 and are anyway much better than they seem.
In week 4 an article will appear on Roughly Drafted pointing out that when you combine the sales of phones with those of unpasteurized low fat organic milk, Apple has in fact got a 65% share of the market, and that actually, the whole concept of market share is a myth.
By week 5, those who bought long term puts will start to cash in.
Sometime in week 7 someone will say 'Those who the Gods wish to destroy, they first make mad'. His post will be modded down to -5 and classed as flamebait.
Prosecution: he installed this OS in an unauthorized fashion, prohibited by the EULA.
Defense: Once he has bought it, you cannot tell him what to do with it.
Prosecution: He didn't buy it, he licensed it.
Defense: He went into a shop, paid for a disk, and has no further obligations. If that's not buying, what is? Do you think he also licensed his copy of War and Peace that he bought in the same store at the same time on the same card?
Prosecution: And, we claim damages....
Defense: Damages for what? He bought it, he installed it, he used it. Can a book publisher collect damages because I use my ordinary glasses to read it with instead of buying a new pair as stipulated in the Eula?
The Higher Criticism, which started out in Germany in the 19c with the aim of establishing a definitive chronology of Biblical events, laying out exactly what the historical evidence for them was, and to data all the various books, used this as a criterion. Scholars still do.
The rule is that if some publicly dateable event is clearly forecast in a text, the text was written after it. How long after is a question. Hume made a similar point. Miracles are by definition violations of natural law. To the extent that they are miraculous, it must be more probable that the natural law held and that either experimental conditions were not correctly reported or the story is false. So they end up either not having happened, or not being miracles.
Funny to see this stuff coming up in exactly the same reasoning about stock market predictions....
There is a serious point here. Not particularly about Apple or music. The question really is about electronic media and traceability and reading/viewing/listening habits. To get the potential issue, you have to fast forward a few years. Now most of the press and pamphlets and magazines have migrated online. Some minority book publishing has also. At this point, every book, record or mag anyone buys online has, imagine, a name and address in it that is verified to a credit card.
Do you really feel completely comfortable about that? Do you for example feel comfortable knowing that that little radical publisher whose mag you subscribed to, and that has just been raided for some good or bad reason, has put your name and address in everything you bought from them? Lets say you live in some country where there had just been a change of regime.
I don't. It seems that if someone wants to write his name and (email) address in his books, or on his record or DVD covers, fine, he should be free to do it. But I cannot see the vendor writing it in the copy as a default in a way that needs tools to take it out again.
Its not about Apple - to the extent that this is just repetition of an old story about Apple its silly. But there is a serious question underneath this. To what extent do we want to be buying online exactly the same anonymous stuff we buy physically? This is not a silly question at all.
I am making a very simple point. In the UK, to be allowed to watch TV, you have to pay a fee. This fee goes to the BBC. What is happening is that in order to be allowed to watch TV at all in the UK, you have to subscribe to the BBC.
This is wrong. It is a violation of human rights - specifically, the right to free access to information.
It is exactly the same as obliging someone to buy one newspaper, in order to be able to read any newspaper. That too would be wrong.
Mock as you will, the thousands of single mothers who are jailed every year in the UK because they allow their children to watch TV, but do not subscribe to or watch the BBC, are having their human rights abused. I don't care whether the European Court upholds the case or not. It is still wrong. There is no possible justification for it, and you have not given one.
Yes, I know, you can avoid paying the license fee by not owning the technical means for receiving TV broadcasts. That is the abuse of human rights. That in order to be allowed to receive any TV broadcasts, you are legally obliged to pay a tax to the BBC, the state boradcaster, one particular broadcaster. You should be free to pay whichever broadcaster you want to watch. You should not have to pay for the BBC if you do not want to watch it. This is an abuse of human rights. No way around it.
How would you like to have to buy the Times, in order to be able to read any newspaper? Even if it were couched in language about owning the technical means to read a newspaper? It would be equally wrong. There is no excuse for compelling people to fund one particular media institution when they do not want to consume its offerings.
I think there is no way that Apple can justify, in its future financials, the level of expectations that are now discounted in its share price. I think this has been true for some time. However, the problem with these things is calling the top. The fact that it is fundamentally a ridiculous price can be true for a long time, and the price can still rise, as it has. So we have to find some moment at which there is a public and visible sign that all the possible good news and more is really in the public domain and discounted.
This just happened. It is like appearing on the cover of Business Week. There are no more surprises to come on the upside. All the surprises will be on the downside. Now, there could be bumps up. But if you are betting, the odds at this point favor the long term put buyer.
I think the iPhone will be a bust - in relation to expectations. But I don't have to be right about this to be right about the puts. The current price is discounting any possible performance. Look at Cisco. It was a great company in 2001. It still is. And you could lose money all the way down.
The problem is a simple one. In the UK, in order to have the legal right to watch any television, including non-BBC television, you are obliged to subscribe to the BBC. It is compulsory, its a criminal offense not to.
It is as if, for you guys in the US, in order for you to be allowed to read any newspaper, you were legally obliged to buy a subscription to the NY Times, whether you wanted to read it or did read it or not. It is as if you are legally obliged to buy a copy of Windows in order to own a computer and run Linux or MacOS, whether you install and use it or not. Whether you even can install and use it or not. You buy computer, Mac or barebones. Fine, pay fee to MS.
Now, the BBC has no corresponding obligations back to you. And there is no way you can say, no I would like to choose an alternative supplier of TV. You cannot, for instance, say that, since the BBC does not support your chosen OS, but Sky does, you are going to subscribe to Sky instead. No, you subscribe to Sky AS WELL.
Whether the BBC does DRM is neither here nor there - its no more objectionable, nor less so, than any other company doing DRM.
What is appalling, and a total denial of human rights, is that it forces people to subscribe, whether they want or can access its content or not, so they can get to different content they do want and can access.
Now, in reply to this point, we ordinarily get people saying that the BBC is excellent. Ie they like it. They can receive its content. They want to subscribe. Its just irrelevant to the human rights issue. I should have the right to watch TV without paying for the BBC if I do not want to watch it.
Tell me again why everyone else has to be compelled to subscribe?
One was waiting for something like this. It is clearly the top, at last, and its time to buy the long term puts. When the Economist writes laudatory articles about a company just before it releases a product which is a huge gamble, you know. They ring a bell at the top.
Yes, England does have similar restrictions. They come from consumer protection. No unfair terms, no imposition because of supplier power over consumer. No violation on anti competitive tactics (which would include linked sales and attempts to impose post-sale restrictions on use). Will be very interesting to see if this is actually enforceable. Eulas are enforceable. The question is whether these terms are in this case. I'd be sceptical, but you need to go through the detail to be sure.
What Weber does wrong is to try to impose post sales restrictions on use. The young man bought the product. He then used it in accordance with publicly available APIs. You have no right to restrict what someone does with something in the EC, AFTER HE HAS BOUGHT IT.
Lets say I buy a brand of paint which is marked for domestic use only, not in way of trade. Suppose I go paint a dining room for profit. My client likes the texture. Can they sue me for misusing it? No. They can refuse to cover it with warranties, they can make it hard to put on with ordinary equipment, but once I bought it, they can't tell me what to do with it. Suppose a book comes with the condition that I may not read it in the bath. Can they sue me if they find I have done it, instead of buying the encapsulated page version? No they cannot. At least not in the EC.
Microsoft will lose this one, and will lose enormously in terms of publicity. Its totally idiotic conduct by people who should know better.
Its in threads like this that you see the extraordinary lengths to which the cult of Apple has gone. Not the cult of Mac, or of OSX, or of iPhone, but the cult of the company. You see it in the hysterical and defensive reactions to any criticism of any proposed product. For instance, the Register carried an article which, while very positive about the device itself, and Apple the company, thought that the sales projections for the iPhone were over-optimistic. Read Roughly Drafted's reaction - a tirade of rhetorical abuse and labelling of the author as an Apple basher. We have the same thing with Apple TV.
We are in a bubble. One would say that the answer is long term puts - but phenomena like this have amazing vitality and can run to extremes beyond what one could imagine in wildest dreams in the earlier stages, and survive disappointments that would terminate any rational set of beliefs. That will be the answer soon, but maybe not just yet.
My own view is that both the TV and the iPhone will be financial busts. And that a leading part of the reason for this will be that its almost impossible for Cupertino to maintain contact with reality, because they are so caught in the web created by their encouragement of cult marketing. There's almost no way for them not to believe their own hype as it is reflected back at them by the fans. So they really cannot see that the devices are overpriced and almost unusable.
Those who the Gods wish to destroy, they first make mad.
Way back when, British Leyland aka Rover was a Great UK Car Company. This is before it finally exhausted subsidies and went bust. In those days, to keep it in business, the Government permitted a cartel which fixed prices at levels where BL could more or less break even. This was at levels about 40% higher than in Europe. Everyone in Britain paid far more than the world price for cars, just as they do now for CDs. To benefit BL, just as now to benefit the record companies.
So guess what? BL then exported their cars to Germany, and sold them below cost. Doubtless in pursuit of the Queen's Awards for Export. Enterprising people with a crazed desire to buy cars guaranteed to rust and break down then tried to import them back into the UK.... After all, if you were going to buy a pile of junk, why pay list for it? That's not quite how they thought of it.
The more it goes around, the more it comes around.
There's well available evidence which, if you look and put it together, will suggest around $100 million in revenues. If this is so, it would suggest sales of between 500k and 1 million units a year. This, if they vanished, would be a significant hit. I would like people not simply to focus on denial or ridicule of what I've said, by simple assertion, but on coming up with some alternative and real estimates of numbers. That is how the factual discussion can advance.
There are two further interesting questions to ask, in addition to the level of sales. One is, what level of sales would it take to prove the point? Do you agree that if the above numbers are correct, they amount to a significant dependency? Or if not, where is this threshold? And second, do you think the Mac would survive specifically in the business market without Office? Then one could go on and try to estimate the percentage sales into business environments which pretty much require Office. That is another way in.
My view is yes, the above numbers, if correct, are a significant dependency, and no, it would not survive in business, at least not in any numbers, and that would have a follow on effect on non-corporate and educational sales over time.
It may be that something has changed since the days when Gates was persuaded, for whatever reason, to make a public commitment to Office for the Mac. Clearly, then, in the view of Cupertino, that was important and valuable at the time. It doesn't look from here as if much has changed however. Office is still central in business and institutions. If you are photographer doing Photoshop in your studio on a high end workstation with a couple of monitors and a ton of memory, you really do not care. But any time you're swapping documents within an organization, surely nothing has changed?
Its a great paradox. One knows lots of left leaning people who have Macs, and apart from simply being used to them and liking them, do also think of it as an appropriate lifestyle choice, on the side of freedom so to speak. They also without exception run Office. If you suggest to them that there is maybe not as much political difference as they might like to feel between running Office as a workhorse on XP or on OSX, but that there is a real difference between running either of those and running Open Source, they become a little uncomfortable. You have defined yourself as being on the other point of the triangle, geeky. To me, the dependency is part of this. You have coke or pepsi, and then on the other side of the line, you have your own squeezed fruit juice. What makes a real difference is, are you drinking juice, or are you drinking sugared carbonated phosphorized water from one or other large company? Whose name is on the can is not unimportant in terms of taste, but that's all the difference is. and one is not in any real sense an alternative to the other. Saks or Barney's - you're still wearing suits.
I guess that is what the argument about dependency is really about at bottom. Unsurprisingly, I think the facts about it are on my side if you just look. But in the end, its also about something more, its about what we would like to believe is a real different choice, if we make it. People who say things like this are very uncomfortable. The next thing they'll be saying is, East Side or West Side is not a fundamental choice either....
I think its around $100 million a year in revenue terms. Do you have a better estimate or any reason to dispute this one? How much do you think Mac Office sells for on average? That lets you estimate the units. Then we know that a great many of those are sold with new machines. How many of those machine sales would be lost if Office were to vanish?
My estimate would be 20% of total Mac sales would go in year one, but increasing over time to around 50%. There would be a delayed impact, and the Mac would vanish from business. Education would be hit hard too, but they keep their machines a long time.
I don't really understand why people are so uptight about the idea that MS and Apple are in a fairly close business relationship. What is so awful or novel about it? There was the investment years ago. There was the technology agreement. What's the fuss about?
No, this is mistaken. If you subtracted Office compatibility, you would destroy Macs as a platform in business.
I did not argue that the only reason Apple is increasing hardware sales is 'because people only want to run Office on that platform', and do not think that is true. I argued that the ability to run Office is a necessary condition of increasing hardware sales. That is a completely different argument, and it is true.
If you doubt the significance of the business relationship between MS and Apple, look at the size of the MS sales to the Mac. Its big business by most standards. Its significant business even by MS standards. Look it up and tell us how much it is.
I really do not get why this is rated a troll. Its a serious point. The argument from derivative works is basic economics, applied in a slightly unusual context and way, but its intellectually respectable. Yes, it is true that so far open source has not made inroads. But that does not mean the economic foundations are not laid to make its model, long term, more likely to win out. Nor does it mean that the MS and Apple model do not have more in common than they have differences.
You have to imagine someone arguing, and being ridiculed for arguing, before the advent of the AT, that open hardware, and OS independent hardware, was going to be the future. He would have been ridiculed for not being able to point to signs of it happening. But it did happen. He would have argued also that Univac, IBM, Dec, Control Data, all would rise and fall together, and that they were using the same model. Again, he would have been ridiculed by moderators. And right.
If you want to argue with the point, don't reach for moderation, reach for the keyboard and ARGUE. Explain why, in your view, open source with the ability to spawn derivative works, does not offer a more competitive business model.
Maybe there's a reason. But labelling arguments to the contrary trolls is not giving one.
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I want to defend the UK record on these matters against what seems like rather unthinking criticism. The UK law is quite careful about making appropriate distinctions between different levels of offence.
It first distinguishes between acts of abuse, and images of acts of abuse.
Second, it distinguishes between different kinds of illegal content - it distinguishes between Child Pornography, which is contrary to the Child Protection Act, illegal pornorgraphy, which is defined in the Obscene Publications legislation, and plain ordinary legal erotic material.
Third, it distinguishes between possession and publication. The only material which it is illegal to possess is that covered by the Child Protection Act. Other material may be illegal to publish or disseminate, but not to own.
Fourth, it distinguishes between different channels and levels of access. Material which may be broadcast after the 9pm watershed on television may not be lawfully broadcast before it. Material which may appear in cinemas with an Adult rating may not appear with a universal rating.
Fifth, its distinctions are not solely based on sexual content. It also tries to control the dissemination of or access to other kinds of material, violent, racist - look at the Race Relations legislation. Look at the recent video game episode.
Its against this background, which is one of a legal establishment doing its best to treat different things differently, that you have to see the present proposals. Despite what people are saying here, its not clear that the proposal actually is that material which it is legal to publish is going to be made illegal to own. That seems most unlikely given the care with which these matters are usually approached. It also seems unenforceable. If its legal to publish, its legal to own. If its legal to own, it has to be legal to clip out sections. So if this is really in the present proposals, which is a bit hard to tell from the draft as published, it will almost certainly not be in the final version.
The difficulty they are having with drafting is a well meaning but probably mistaken effort to accommodate 'art' movies, in which material which would normally fall under the Obscene Publications legislation can be granted a sort of contextual exemption. A little as if Germany would give a contextual exemption to art films in which Nazi era footage appeared. However, the UK record recently on taking context into account is rather a good one.
The proposals do seem ill advised. Not because they unfairly discriminate or criminalize S&M devotees. Rather, because existing legislation is arguably comprehensive enough and fine tuned enough to make any further legislation unnecessary, or at least, it is comprehensive enough given fairly minor amendments. It would probably be better to review the material covered by existing legislation, and if necessary enlarge its scope. Also, blaming the Internet is thoroughly misguided of course - but the grieving will inevitably feel they have to blame something.
Do not just condemn the UK's approach to these matters out of hand without finding out exactly how they do things. Its a difficult area, they do make mistakes, particularly sometimes in enforcement, but on the whole the record is moderate, rational and praiseworthy.
Sorry, I meant to use 'you' in the sense of 'one' - not you personally. In fact I'm basically agreeing. I think many of the arguments used against the RIAA are because of peoples dislike of them, and that they would not be used or thought legitimate in a different context.
What is hard to understand is, why they thought it was sensible to tie the phone to one network. Evidently they did not need to do this to generate sales. So why did they not simply allow people to buy and register with whoever they wanted? The margins seem to be high enough, the demand was there? What was the point? In fact, would they not have sold more if they hadn't locked it to one network?
Its true they control the customers' network choice. But why do they care which network he/she chooses? Does anyone have a simple explanation of this?
I don't think we'd accept the WLAN and WEP breach defenses as reasons for not using IP evidence as grounds for investigation, search warrants and so on.
We probably would accept it, at least in some circumstances, with more evidence of WLAN and WEP breaches than the mere possibility, as constituting reasonable doubt about whether a crime had been committed. We'd require more evidence than the IP evidence - for instance, material on disk.
The difficulty you have with the RIAA is really four things. One, people think its a desperate defence of a dead business model. Two they think its trying to reduce rights which buyers had below what they had for physical media. Three they see evidence with potential technical holes in it being used. Four, they see the evidence which should only be grounds for investigation being used as if it would support the weight of prosecution without any more supporting material evidence.
The last point would probably be felt to apply regardless of the crime being investigated.
I do advise my friends who are renting out property with a built in wireless broadband connection to have a clause in the lease to the effect that WPA security is implemented on the router and may not be turned off, and not to give the strong admin password on the router. Of course, your tenants can reset and leave it open, but at least you will know its happened, and you have taken just about all the precautions you reasonably can other than putting the thing in a locked closet. But pity anyone who rents out a room in his main house, gives access to the broadband connection, maybe even wired rather than wireless access, and finds the front door being broken down at three in the morning. I guess its a case of 'know your customer'!
Well, since modded down to troll, Heaven knows why, with some trepidation one asks, how is it going to be stopped? It will be out there as a retail copy, it will not be an upgrade. It will boot and install in a macintel. Don't you think that in ten minutes there will be posted some hack on how to run it on any old similar spec Intel box? Or if not, how is it going to be prevented?
Yes, I know that non-DRM stuff is sold on iTunes. Of course it is. That's not the point. The point is the coding. Once you have bought your non DRM iTune, you can't play it on another box. My prediction is, the Universal thing is the beginning of the end of this, and within a year, it will be over one way or another.
Why this legitimate opinion should be labelled a troll by the resident fatwa issuers, Heaven knows. But there you go.
All the same, I never saw a chart that said "distribution" more clearly than this one:
a sp?symb=AAPL&sid=609&dist=TQP_chart_date&freq=1&ti me=3mo
http://www.marketwatch.com/tools/quotes/intchart.
"But don't take my word for it, go and see for yourself" (RD Laing).
Simple really. They are not selling enough through iTunes to make it worthwhile. This is because iPod people do not buy many tunes. So they figure, we are losing more to piracy than we are making. Now, lets see, what if we sold non-DRM that would play on anything. Would that be better or worse? Probably better. We could hardly lose more to piracy than we are now. But why rush it? In the meantime, lets go month to month while we do a bit more research and see which way the cat will jump. And whether iPhone will sell.
Personally, I think its the first of the spring cracks in the ice. I don't think the iPod iTunes locked business model will last much longer. Like, not more than a year. Just like the locked iPhone model will not, and I think with Leopard we will see the locked OS model fall to bits. But we will see.
You have to ask what sort of numbers it would take to justify the hype expressed in the share price.
Right now the price/sales ratio is 5 (Morningstar, based on 2006 full year numbers). Revenues were around 19 billion to generate that ratio. So lets say they sell (round numbers) a million phones at 600 each, which would be 600 million in dollars. Lets say that the price/sales ratio is headed back to the historical norm for Apple of below 3. Let alone they fall to more reasonable numbers.
Question: how many would they have to sell for revenues to rise to levels where the ratio would be 'normal'?
Well, assume the price stays the same and revenues double. That would do it comfortably - and maybe leave a little room for growth in the share price. That would imply, if it all came from phones, around 30 million phones. There is no need to be more precise - its the general scale of the thing we are interested in.
So you see that selling a million is not really cutting it in terms of the expectation built into the price at the moment. What they needed to justify the price was lines around the block for a week. Not for an evening.
We can now expect to move to phase two of the bubble, during which the Apple folks tell us (a) sales are in fact higher than they look (b) they are going to pick up very soon (c) market share doesn't matter (d) market share is higher than it looks....
The stock price action will however tell the real story. If it goes up for the next month, we know its working. If not....watch out below.
We all seeming to make predictions, so here is one.
Yes there will be people camping outside. Yes, they will go for inflated prices on day 2 on Ebay.
Sometime around week 2. there will be no crowds.
By the end of week 3 the extra staff will have been laid off. Mac fans will be saying that anyone who says this is poor sales and below expectations is an Apple hater and knocker and in the pay of MS, and that sales will pick up in week 4 and are anyway much better than they seem.
In week 4 an article will appear on Roughly Drafted pointing out that when you combine the sales of phones with those of unpasteurized low fat organic milk, Apple has in fact got a 65% share of the market, and that actually, the whole concept of market share is a myth.
By week 5, those who bought long term puts will start to cash in.
Sometime in week 7 someone will say 'Those who the Gods wish to destroy, they first make mad'. His post will be modded down to -5 and classed as flamebait.
Prosecution: he installed this OS in an unauthorized fashion, prohibited by the EULA.
Defense: Once he has bought it, you cannot tell him what to do with it.
Prosecution: He didn't buy it, he licensed it.
Defense: He went into a shop, paid for a disk, and has no further obligations. If that's not buying, what is? Do you think he also licensed his copy of War and Peace that he bought in the same store at the same time on the same card?
Prosecution: And, we claim damages....
Defense: Damages for what? He bought it, he installed it, he used it. Can a book publisher collect damages because I use my ordinary glasses to read it with instead of buying a new pair as stipulated in the Eula?
Well, it would be a fun case to see.
The Higher Criticism, which started out in Germany in the 19c with the aim of establishing a definitive chronology of Biblical events, laying out exactly what the historical evidence for them was, and to data all the various books, used this as a criterion. Scholars still do.
The rule is that if some publicly dateable event is clearly forecast in a text, the text was written after it. How long after is a question. Hume made a similar point. Miracles are by definition violations of natural law. To the extent that they are miraculous, it must be more probable that the natural law held and that either experimental conditions were not correctly reported or the story is false. So they end up either not having happened, or not being miracles.
Funny to see this stuff coming up in exactly the same reasoning about stock market predictions....
There is a serious point here. Not particularly about Apple or music. The question really is about electronic media and traceability and reading/viewing/listening habits. To get the potential issue, you have to fast forward a few years. Now most of the press and pamphlets and magazines have migrated online. Some minority book publishing has also. At this point, every book, record or mag anyone buys online has, imagine, a name and address in it that is verified to a credit card.
Do you really feel completely comfortable about that? Do you for example feel comfortable knowing that that little radical publisher whose mag you subscribed to, and that has just been raided for some good or bad reason, has put your name and address in everything you bought from them? Lets say you live in some country where there had just been a change of regime.
I don't. It seems that if someone wants to write his name and (email) address in his books, or on his record or DVD covers, fine, he should be free to do it. But I cannot see the vendor writing it in the copy as a default in a way that needs tools to take it out again.
Its not about Apple - to the extent that this is just repetition of an old story about Apple its silly. But there is a serious question underneath this. To what extent do we want to be buying online exactly the same anonymous stuff we buy physically? This is not a silly question at all.
I am making a very simple point. In the UK, to be allowed to watch TV, you have to pay a fee. This fee goes to the BBC. What is happening is that in order to be allowed to watch TV at all in the UK, you have to subscribe to the BBC.
This is wrong. It is a violation of human rights - specifically, the right to free access to information.
It is exactly the same as obliging someone to buy one newspaper, in order to be able to read any newspaper. That too would be wrong.
Mock as you will, the thousands of single mothers who are jailed every year in the UK because they allow their children to watch TV, but do not subscribe to or watch the BBC, are having their human rights abused. I don't care whether the European Court upholds the case or not. It is still wrong. There is no possible justification for it, and you have not given one.
Yes, I know, you can avoid paying the license fee by not owning the technical means for receiving TV broadcasts. That is the abuse of human rights. That in order to be allowed to receive any TV broadcasts, you are legally obliged to pay a tax to the BBC, the state boradcaster, one particular broadcaster. You should be free to pay whichever broadcaster you want to watch. You should not have to pay for the BBC if you do not want to watch it. This is an abuse of human rights. No way around it.
How would you like to have to buy the Times, in order to be able to read any newspaper? Even if it were couched in language about owning the technical means to read a newspaper? It would be equally wrong. There is no excuse for compelling people to fund one particular media institution when they do not want to consume its offerings.
I think there is no way that Apple can justify, in its future financials, the level of expectations that are now discounted in its share price. I think this has been true for some time. However, the problem with these things is calling the top. The fact that it is fundamentally a ridiculous price can be true for a long time, and the price can still rise, as it has. So we have to find some moment at which there is a public and visible sign that all the possible good news and more is really in the public domain and discounted.
This just happened. It is like appearing on the cover of Business Week. There are no more surprises to come on the upside. All the surprises will be on the downside. Now, there could be bumps up. But if you are betting, the odds at this point favor the long term put buyer.
I think the iPhone will be a bust - in relation to expectations. But I don't have to be right about this to be right about the puts. The current price is discounting any possible performance. Look at Cisco. It was a great company in 2001. It still is. And you could lose money all the way down.
The problem is a simple one. In the UK, in order to have the legal right to watch any television, including non-BBC television, you are obliged to subscribe to the BBC. It is compulsory, its a criminal offense not to.
It is as if, for you guys in the US, in order for you to be allowed to read any newspaper, you were legally obliged to buy a subscription to the NY Times, whether you wanted to read it or did read it or not. It is as if you are legally obliged to buy a copy of Windows in order to own a computer and run Linux or MacOS, whether you install and use it or not. Whether you even can install and use it or not. You buy computer, Mac or barebones. Fine, pay fee to MS.
Now, the BBC has no corresponding obligations back to you. And there is no way you can say, no I would like to choose an alternative supplier of TV. You cannot, for instance, say that, since the BBC does not support your chosen OS, but Sky does, you are going to subscribe to Sky instead. No, you subscribe to Sky AS WELL.
Whether the BBC does DRM is neither here nor there - its no more objectionable, nor less so, than any other company doing DRM.
What is appalling, and a total denial of human rights, is that it forces people to subscribe, whether they want or can access its content or not, so they can get to different content they do want and can access.
Now, in reply to this point, we ordinarily get people saying that the BBC is excellent. Ie they like it. They can receive its content. They want to subscribe. Its just irrelevant to the human rights issue. I should have the right to watch TV without paying for the BBC if I do not want to watch it.
Tell me again why everyone else has to be compelled to subscribe?
One was waiting for something like this. It is clearly the top, at last, and its time to buy the long term puts. When the Economist writes laudatory articles about a company just before it releases a product which is a huge gamble, you know. They ring a bell at the top.
You just have to know to listen for it.
Yes, England does have similar restrictions. They come from consumer protection. No unfair terms, no imposition because of supplier power over consumer. No violation on anti competitive tactics (which would include linked sales and attempts to impose post-sale restrictions on use). Will be very interesting to see if this is actually enforceable. Eulas are enforceable. The question is whether these terms are in this case. I'd be sceptical, but you need to go through the detail to be sure.
What Weber does wrong is to try to impose post sales restrictions on use. The young man bought the product. He then used it in accordance with publicly available APIs. You have no right to restrict what someone does with something in the EC, AFTER HE HAS BOUGHT IT.
Lets say I buy a brand of paint which is marked for domestic use only, not in way of trade. Suppose I go paint a dining room for profit. My client likes the texture. Can they sue me for misusing it? No. They can refuse to cover it with warranties, they can make it hard to put on with ordinary equipment, but once I bought it, they can't tell me what to do with it. Suppose a book comes with the condition that I may not read it in the bath. Can they sue me if they find I have done it, instead of buying the encapsulated page version? No they cannot. At least not in the EC.
Microsoft will lose this one, and will lose enormously in terms of publicity. Its totally idiotic conduct by people who should know better.
No, I had no views one way or the other about the iPod.
Its in threads like this that you see the extraordinary lengths to which the cult of Apple has gone. Not the cult of Mac, or of OSX, or of iPhone, but the cult of the company. You see it in the hysterical and defensive reactions to any criticism of any proposed product. For instance, the Register carried an article which, while very positive about the device itself, and Apple the company, thought that the sales projections for the iPhone were over-optimistic. Read Roughly Drafted's reaction - a tirade of rhetorical abuse and labelling of the author as an Apple basher. We have the same thing with Apple TV.
We are in a bubble. One would say that the answer is long term puts - but phenomena like this have amazing vitality and can run to extremes beyond what one could imagine in wildest dreams in the earlier stages, and survive disappointments that would terminate any rational set of beliefs. That will be the answer soon, but maybe not just yet.
My own view is that both the TV and the iPhone will be financial busts. And that a leading part of the reason for this will be that its almost impossible for Cupertino to maintain contact with reality, because they are so caught in the web created by their encouragement of cult marketing. There's almost no way for them not to believe their own hype as it is reflected back at them by the fans. So they really cannot see that the devices are overpriced and almost unusable.
Those who the Gods wish to destroy, they first make mad.
Way back when, British Leyland aka Rover was a Great UK Car Company. This is before it finally exhausted subsidies and went bust. In those days, to keep it in business, the Government permitted a cartel which fixed prices at levels where BL could more or less break even. This was at levels about 40% higher than in Europe. Everyone in Britain paid far more than the world price for cars, just as they do now for CDs. To benefit BL, just as now to benefit the record companies.
So guess what? BL then exported their cars to Germany, and sold them below cost. Doubtless in pursuit of the Queen's Awards for Export. Enterprising people with a crazed desire to buy cars guaranteed to rust and break down then tried to import them back into the UK.... After all, if you were going to buy a pile of junk, why pay list for it? That's not quite how they thought of it.
The more it goes around, the more it comes around.
There's well available evidence which, if you look and put it together, will suggest around $100 million in revenues. If this is so, it would suggest sales of between 500k and 1 million units a year. This, if they vanished, would be a significant hit. I would like people not simply to focus on denial or ridicule of what I've said, by simple assertion, but on coming up with some alternative and real estimates of numbers. That is how the factual discussion can advance.
There are two further interesting questions to ask, in addition to the level of sales. One is, what level of sales would it take to prove the point? Do you agree that if the above numbers are correct, they amount to a significant dependency? Or if not, where is this threshold? And second, do you think the Mac would survive specifically in the business market without Office? Then one could go on and try to estimate the percentage sales into business environments which pretty much require Office. That is another way in.
My view is yes, the above numbers, if correct, are a significant dependency, and no, it would not survive in business, at least not in any numbers, and that would have a follow on effect on non-corporate and educational sales over time.
It may be that something has changed since the days when Gates was persuaded, for whatever reason, to make a public commitment to Office for the Mac. Clearly, then, in the view of Cupertino, that was important and valuable at the time. It doesn't look from here as if much has changed however. Office is still central in business and institutions. If you are photographer doing Photoshop in your studio on a high end workstation with a couple of monitors and a ton of memory, you really do not care. But any time you're swapping documents within an organization, surely nothing has changed?
Its a great paradox. One knows lots of left leaning people who have Macs, and apart from simply being used to them and liking them, do also think of it as an appropriate lifestyle choice, on the side of freedom so to speak. They also without exception run Office. If you suggest to them that there is maybe not as much political difference as they might like to feel between running Office as a workhorse on XP or on OSX, but that there is a real difference between running either of those and running Open Source, they become a little uncomfortable. You have defined yourself as being on the other point of the triangle, geeky. To me, the dependency is part of this. You have coke or pepsi, and then on the other side of the line, you have your own squeezed fruit juice. What makes a real difference is, are you drinking juice, or are you drinking sugared carbonated phosphorized water from one or other large company? Whose name is on the can is not unimportant in terms of taste, but that's all the difference is. and one is not in any real sense an alternative to the other. Saks or Barney's - you're still wearing suits.
I guess that is what the argument about dependency is really about at bottom. Unsurprisingly, I think the facts about it are on my side if you just look. But in the end, its also about something more, its about what we would like to believe is a real different choice, if we make it. People who say things like this are very uncomfortable. The next thing they'll be saying is, East Side or West Side is not a fundamental choice either....
I think its around $100 million a year in revenue terms. Do you have a better estimate or any reason to dispute this one? How much do you think Mac Office sells for on average? That lets you estimate the units. Then we know that a great many of those are sold with new machines. How many of those machine sales would be lost if Office were to vanish?
My estimate would be 20% of total Mac sales would go in year one, but increasing over time to around 50%. There would be a delayed impact, and the Mac would vanish from business. Education would be hit hard too, but they keep their machines a long time.
I don't really understand why people are so uptight about the idea that MS and Apple are in a fairly close business relationship. What is so awful or novel about it? There was the investment years ago. There was the technology agreement. What's the fuss about?
No, this is mistaken. If you subtracted Office compatibility, you would destroy Macs as a platform in business.
I did not argue that the only reason Apple is increasing hardware sales is 'because people only want to run Office on that platform', and do not think that is true. I argued that the ability to run Office is a necessary condition of increasing hardware sales. That is a completely different argument, and it is true.
If you doubt the significance of the business relationship between MS and Apple, look at the size of the MS sales to the Mac. Its big business by most standards. Its significant business even by MS standards. Look it up and tell us how much it is.
I really do not get why this is rated a troll. Its a serious point. The argument from derivative works is basic economics, applied in a slightly unusual context and way, but its intellectually respectable. Yes, it is true that so far open source has not made inroads. But that does not mean the economic foundations are not laid to make its model, long term, more likely to win out. Nor does it mean that the MS and Apple model do not have more in common than they have differences.
You have to imagine someone arguing, and being ridiculed for arguing, before the advent of the AT, that open hardware, and OS independent hardware, was going to be the future. He would have been ridiculed for not being able to point to signs of it happening. But it did happen. He would have argued also that Univac, IBM, Dec, Control Data, all would rise and fall together, and that they were using the same model. Again, he would have been ridiculed by moderators. And right.
If you want to argue with the point, don't reach for moderation, reach for the keyboard and ARGUE. Explain why, in your view, open source with the ability to spawn derivative works, does not offer a more competitive business model.
Maybe there's a reason. But labelling arguments to the contrary trolls is not giving one.