Summary of today's Apple announcements (no iPod phone)

Summary of today's Apple announcements (no iPod phone)

Summary: I'm sitting here in my home office in northern Massachusetts trying to find out what Steve Jobs is saying at his product roll-out (taking place right now) and my first choice of sites to visit was Engadget.  But I'm apparently not the only one who thinks Engadget is going to have the best blow-by-blow coverage.

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TOPICS: Apple
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I'm sitting here in my home office in northern Massachusetts trying to find out what Steve Jobs is saying at his product roll-out (taking place right now) and my first choice of sites to visit was Engadget.  But I'm apparently not the only one who thinks Engadget is going to have the best blow-by-blow coverage. The site is so overwhelmed with traffic, I haven't been able to successfully load one page.  So, now, I'm trying to hit Engadget (really good pictures), MacWorld, and CNET Reviews for details. Keep hitting refresh for changes to the following capsule summary.

Update: OK, I've finally got a page here.  So far, it looks like enhancements to the iPod line up with brighter displays, better earphones, and what Jobs is referring to as gapless playback (where there's no dead space between songs).  Then, the iPod is also going to be a handheld gaming system with games that are designed to take advantage of the wheel.  Initial games will be Zuma, Texas Hold 'Em, Mini Golf, Cubis 2, PacMan, Tetris! and Mah-jong and they can be purchased at the iTunes Music Store. Jobs claims that the new iPods will have 75 percent more battery life (key for playing videos on those long flights) and the entry level price is being dropped to $249. The Nano is getting thinner and it too will have a brighter display and longer battery life and will be packaged more efficiently in an effort to make it more Earth-friendly.  There's a new Shuttle that Jobs has claimed to be the world's smallest MP3 player.

Jobs has gone on to remind his audience of about 300 or so people that the iTunes Music Store (iTMS) controls about 88 percent of the legal downloads market in the US (in my estimation, that's a monopoly the remedy to which should be the untying of iPods to the iTunes Music Store by way of Apple's proprietary digital rights management technology known as FairPlay). Incidentally, the iTMS was shut down for update leading up to this announcement.  Jobs introduced a new version of the iTunes software (iTunes 7) that Engadget says looks like flipping through your CD rack.

In addition to the 220 shows from the over 40 TV networks that iTMS customers have access too, the NFL Network is being added at $1.99 per game or $24.99 for a season pass and video encoding is being bumped from a resolution of 320x240 to 640x480 (that 2x across 2 dimensions for a total of a 4x improvement in resolution).

One cool new feature (for people who complained bigtime about what happens if a computer crashes) is that iTMS purchase content now flow backward from an iPod to a computer.  So, the net net is that if your computer crashes and you decide to buy a new one, you iPod acts like a digital locker for all the content you're authorized to have and once you install and authorize iTunes on the new computer, all that content will synch from the iPod to the computer.  Nice.  Although what Apple should really be doing is keeping a record of everything you've purchased so that you can re-download it if you have to (a feature that the Navio platform has).

As expected, full length movies will be available from the iTMS and they'll be in the 640x480 "near-DVD quality" resolution and Dolby-quality surround sound according to Jobs (although it's not clear from the reports I'm watching if he was comparing to Dolby, or if the technology is actually used). Full length movies can be downloaded in about a 1/2 an hour over a 5 mbps connection and you can start watching the movie about a minute after download starts.  You cannot burn the movies to DVD.  The "movie store" launches with titles from four of Disney's studios (Jobs is on Disney's board):  Disney, Pixar, Touchstone, and Miramax. Going out the door today, there will be more than 75 films available with more to come like Pirates of the Caribbean 2 and Cars. The movie industry appears to be getting its way with variable pricing (the music business was unable to sway Jobs on that same issue).  New releases will be available at a discount ($12.99) when pre-ordered or ordered during the first week they're out.  Prices will go as high as $14.99 after the first week and older titles will cost $9.99.

Disney CEO and president Bob Iger was apparently on stage to help with the movie roll-out and then Jobs moved onto the last big announcement.. or should I say pre-announcement (since the product won't be available until 2007Q1: a system to drive a flat panel that looks like a Mac Mini (a bit fatter according to Engadget, but shorter according to MacWorld... so "stouter") with a code name of iTV. Jobs isn't apparently happy with that name and it will likely change by the time it launches. 

iTV will have integrated wireless networking, USB, wired Ethernet, an High Definition Multimedia Interface (HDMI), and the standard  component video and analog audio interfaces that any consumer video product is expected to have. Somewhat reminiscent of the the way Sonos' gear works with music, iTV can apparently take "delivery" of its content (eg: an iTMS purchased song) from an iTunes-enabled PC via the wired or wireless network and its FrontRow-esque 3D user interface can be controlled with a remote control (so, iTV is sort of a set-top box on steroids).

The iTV doesn't appear to have a tuner (not that it needs one). In my home setup, provided I wanted to use it, I'd just connect the iTV to the receiver  (more like a networking hub these days given all the sources connected to it) at the heart of my home entertainment setup in my family room. Or, you can connect it directly to a big flat panel. One question I have (since you can connect it to your receiver) is whether or not you can alls use that FrontRow-esque interface to browse and playback any music stored in the iTunes-enabled PC (now that would be a dead hit on what Sonos does). Answer: Yes, not just music, but podcasts and photos too. So, to button that up, iTunes software becomes the master organizer of music, photos, podcasts, movies, and TV shows and then handles the delivery of that content into your entire lifestyle (be it in your mobile player, on your computer, or in your living room).  Actually, Jobs buttoned it up with a slide that said Apple is in your den (I guess that would be your PC), your living room (that'd be the iTV), your car (via iPod connectivity that Jobs claim can be had in 70 percent of new cars sold here in the US), and your pocket (iPods).

What's really interesting to me is that while Jobs is in San Francisco attempting to re-invent home entertainment, the entire home entertainment industry will be at it's annual lovefest (CEDIA) in Denver starting tomorrow. Provided the convergence that Jobs demonstrated today gets traction in the market (in other words, if people start buying movies at the iTMS and watching them on iTV driven flat panels), this is largely bad news for the players (everyone from Pioneer to Escient to Integra, etc) in that industry that make components like DVD players, PVRs (eg: TiVo boxes), audio/video servers, amplifiers, and the like. The key to Apple's success here will be it's digital rights management (DRM) technology (FairPlay).  So far, the company isn't licensing that technology which means it's difficult if not impossible for companies like Escient to participate in the ecosystem Apple is trying to create and dominate. 

Topic: Apple

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  • Monopoly

    Give it a rest with the monopoly rhetoric already.

    One. You do not need iTMS to play music on an iPod.

    Two. You do not need iTMS to get music at all.

    Three. You do not need an iPod to play music purchased from
    iTMS.

    Four. You do not need a Mac to play music purchased from iTMS
    (unlike other download services which tie you to Windows).

    Five. People who ignore all of the above and whine about iTMS
    monopolies are zealots and zealots are boring.
    frgough
    • Re: Monopoly

      One. You're correct that you don't need iTMS(or more specifically iTunes) to play music on an iPod. There are many programs that allow you to sync MP3 files to an iPod. I used to use a Linux app called gtkpod for that purpose.

      Two. Again, you're correct. You could get music from sites like Yahoo Music, Napster, Urge, etc.(With the exceptions of eMusic and Magnatune, all of the above tie you to Windows as you stated in Four).

      Three. That's false, unless you intend to keep your iTMS purchased music on your computer. If you want to take it on the go, you ARE stuck with getting an iPod(or one of those Motorola phones). And don't think about burning them to CD and ripping them back to MP3. That's a waste of time and sound fidelity. If Apple licensed FairPlay like how Microsoft licenses PlaysForSure, then it's a different story. That's what the iTMS monopoly talk is about, when you consider that Steve Jobs himself stated that iTMS has [b]88%[/b] marketshare in the US. How much of that 88% [b]doesn't[/b] have an iPod or Motorola? Don't believe me? Just try and sync your iTMS collection to an iRiver or Sansa, and I guarantee it won't work.

      Four. Well, duh! iTunes is available for Mac and Windows.

      Five. Yes, you're right that people who ignore the above facts and whine are zealots, which is why I chose to respond to all of the above. However you chose to ignore the facts behind David's problems with Apple(and DRM in general), so I guess that makes your post a little zealous, don't you think? ]:)
      Tony Agudo
      • Monopolies

        The legal definition of monopoly requires proof of consumer
        harm. So far there is none. Consumers are accepting Apples
        value proposition in full knowledge of the restrictions. David's
        problems with DRM are should be the same problems he has
        with WGA or any EULA agreement which assigns something
        other than full title ownership. David doesn't have problems with
        EULA's, at least not enough to boycott them. It's a fundamental
        hypocracy.

        Apple does licence FairPlay. They are selective. They compete
        and win in an environment in which a convicted monopolist
        licenses broadly. If Apple's reluctance to license broadly is not to
        your liking, feel free to choose between competitor's products
        within a free market that includes a huge piracy underground. If
        comfort can only be found in this large herd, pick Apple. Know
        that their market share is circumstantial and entirely the wrong
        reason for choosing them. Choose them because of superior
        software and integration, but don't buy abundance to the
        exclusion of the product. That's what has given us the Microsoft
        legacy of mediocrity.

        At some point it will come clear to David Berlind and a lot of
        others, that squeezing a different shape of plastic out of a mold
        has little to do with product differentiation if they all have the
        same brain. Please don't try to tell me that any piece of hardware
        that runs the same codec differentiates itself in any substantive
        way. You've all bought Microsoft's bill of goods. That the illusion
        of choice is in fact choice.

        I am a zealot, but I'm a zealot without my head up my rear.
        Harry Bardal
    • Getting the facts straight

      1. you're correct. I never said different.
      2. not sure that's relevant. what is relevant is 88 percent marketshare of anything (could be cars, oil, or music purchased a la carte for online download) and whether or not that share is be used, perhaps in a tying fashion, to tie people into the purchase of another product when they should be able to buy alternatives. It is. See #3.
      3. If you plan to take your music on the go -- a reasonable "request" given the consumer's history with 8-tracks, casettes, and CDs -- your only legal choice is the iPod or one of the Motorola phones which are pretty much irrelevant in the market for a variety of reasons. If you strip the DRM off to make it usable on something other than an iPod, then you're breaking the law (the Digital Millenium Copyright Act).
      4. That is correct. But you do need iTunes which is again, tying if you ask me.

      To give you an example of how Apple has or can assert its market power and the market hasn't been able to diddly about it, it:

      1. changed the terms on iTunes and forced everyone to upgrade. The terms that changed, relevant to all iTMS-purchased music had to do with the # of CDs you are allowed to burn. The # of CDs is irrelevant. It's the degree to which Apple can say blow the wind south and consumers have to go with that wind. 88 percent share is not insignificant. Other monopolies have been "busted" for similar or less share.
      2.In recognition of that marketshare, the music labels were forced to knuckle under to Apple and accept pricing terms that it was very public about not wanting.
      3.Going back to #1, let's say Apple decides it doesn't want to make a Windows version of iTunes anymore? Much the same way it just decided you can only burn 7 CDs instead of 10. I'm not saying it will. But it could. This business about consumers knowing full well what they're getting into is simply not true. Nor is the bit about consumers and harm. What is your definition of harm? How many iTMS customers want something new like the LG Chocolate, the Motorola Q, or a just a Creative Zen or an Escient Fireball (music server for the home) only to find out after the fact that none of what they purchased at the iTMS will work there? Do you have those facts? I don't even know the answer. But we know they exist... I for example am greatly disappointed that I cannot buy 99 cent songs at iTMS and use them with my whole home theatre system unless I retrofit an iPod to it in a way that it's not completely compatible with my system.
      On point #4, most of that I addressed already but on the Windows point (a) MS has already been busted for antitrust, and (b) it doesn't have 88 percent share of the music download market. If it did, the trustbusters would be all over that.
      Finally, regarding point #5, if I bore you, then tune me out. You think I do this because of zealotry? I do it because I'm trying to look at out for the best interests of technology buyers.

      db
      dberlind
      • Not Boring

        It's not boring. It's just an view of Apple from within the
        Microsoft bubble.

        88 percent market share is circumstantial. It doesn't open the
        door to discussions about an illegal monopoly. That requires
        broad and coercive licensing and or upward pressure on price.

        Regarding license changes with upgrades. When has it not been
        the prerogative of the license holder. How does this differ from a
        standard EULA. Today Apple broadened it's usage to include
        sharing across two authorized computers. Is this considered
        good because it's positive for consumers or bad because it's a
        change to the agreement?

        Broad licensing is the pathway to antitrust. Apple will not make
        those mistakes.

        Hardware restriction is part of the deal. Ignorance of the EULA
        and the deal is no excuse. Consumer advocacy takes the form of
        informing consumers of this in a conversational way. It doesn't
        take the form of running interferance for them, presuming they
        can't make their own value judgements, or calling this value
        proposition CRAP. The decision to buy, or not to buy Tom Petty
        under Apple's terms is a individual's decision. It's a foreign
        concept for those who's criteria fo choice becomes market share
        rather than merit. The irony now is, they coincide for once. It
        feels like a monopoly only because you're making the judgement
        from within one, and it's not Apple's.

        You have extended your own disapointment over your personal
        stereo setup and a previous investment into the CRAP
        monologues. we're all afraid of needing this stuff too much, and
        being taken advantage of, but let's separate wheat from the
        chaff. You've blamed Apple for having to protect and vertically
        integrate their system when iTunes had to grow up and compete
        on merit against the broad licensing that you'd have us admire.
        They didn't start at 88%. How has Apple torpedoed your ability
        to choose from the other players. How have they done anything
        but make you jealous of the gear, the integration and the
        software. Buy a chocolate, or a Nano, or both. If that seems
        expensive, make more money.

        As Microsoft proceeds to corral and kill their partners, please
        take time and separate the annoyance that should be directed at
        them. Microsoft, through licensing broadly has again subverted
        competition, produced a perverted marketplace and replaced
        choice, with the illusion of choice.
        Harry Bardal
        • Ignorance of the contract terms is a defense

          If you are not aware of the contract terms and they were not visible when you signed said contract, because said terms were not present in said contract when agreed to, then that certainly is a defense. In fact a contract in which one party can unilaterally change the contract terms without notification to the other party sounds like good grounds to invalidate the entire contract.

          With clickwrap contracts portions are found to be non-binding all the time. This is further exacerbated as copyright law has a preemption clause in it that preempts any state law , contract law, that covers the exclusive rights defined in the copyright act. [url=http://cyber.law.harvard.edu/ilaw/Contract/vault.htm]Vault Corp. v. Quaid Software, Ltd., 847 F.2d 255 (5th Cir. 1988)[/url] is a good example where the contract was preempted do to this.

          [i]The district court held that Vault's license agreement was "a contract of adhesion which could only be enforceable if the [Louisiana License Act] is a valid and enforceable statute." Vault, 655 F.Supp. at 761. The court noted numerous conflicts between Louisiana's License Act and the Copyright Act, including: (1) while the License Act authorizes a total prohibition on copying, the Copyright Act allows archival copies and copies made as an essential step in the utilization of a computer program, 17 U.S.C. ? 117; (2) while the License Act authorizes a perpetual bar against copying, the Copyright Act grants protection against unauthorized copying only for the life of the author plus fifty years, 17 U.S.C. ? 302(a); and (3) while the License Act places no restrictions on programs which may be protected, under the Copyright Act, only "original works of authorship" can be protected, 17 U.S.C. ? 102. Vault, 655 F.Supp. at 762-63. The court concluded that, because Louisiana's License Act "touched upon the area" of federal copyright law, its provisions were preempted and Vault's license agreement was unenforceable. Id. at 763.

          In Sears, Roebuck & Co. v. Stiffel Co., 376 U.S. 225, 84 S.Ct. 784, 11 L.Ed.2d 661 (1964), the Supreme Court held that "[w]hen state law touches upon the area of [patent or copyright statutes], it is 'familiar doctrine' that the federal policy 'may not be set at naught, or its benefits denied' by the state law." Id. at 229, 84 S.Ct. at 787 (quoting Sola Elec. Co. v. Jefferson Elec. Co., 317 U.S. 173, 176, 63 S.Ct. 172, 173, 87 L.Ed. 165 (1942)). See Compco Corp. v. Day-Brite Lighting, Inc., 376 U.S. 234, 84 S.Ct. 779, 11 L.Ed.2d 669 (1964); see also Mitchell v. Penton/Indus. Publishing Co., 486 F.Supp. 22 (N.D. Ohio 1979) (holding that common law unfair competition claim preempted by the Copyright Act); Triangle Publications, Inc. v. Sports Eye, Inc., 415 F.Supp. 682, 686-87 (E.D.Penn.1976) (holding that state regulation of unfair competition preempted as to matters falling within broad confines of the Copyright Act). Section 117 of the Copyright Act permits an owner of a computer program to make an adaptation of that program provided that the adaptation is either "created as an essential step in the utilization of the computer program in conjunction with a machine," ? 117(1), or "is for archival purpose only," ? 117(2). [FN30] The provision in Louisiana's License Act, which permits a software producer to prohibit the adaptation of its licensed computer program by decompilation or disassembly, conflicts with the rights of computer program owners under ? 117 and clearly "touches upon an area" of federal copyright law. For this reason, and the reasons set forth by the district court, we hold that at least this provision of Louisiana's License Act is preempted by federal law, and thus that the restriction in Vault's license agreement against decompilation or disassembly is unenforceable.
          [/i]

          Even though such contractual claims may be unenforceable or would normally be preempted DRM will enforce the terms regardless. Under the DMCA it is against the law to circumvent the Access control mechanism even though the end consumer would normally not be bared from the activity Eg; playing a DVD (On Linux).

          Notice I don't say copy control as DRM is not typically copy control and the language of the DMCA covers more than copy control and indeed does say access control. The studios are very quick to point out that the law indeed does read access control and this is exactly what they are planning on controlling in their testimony to congress.

          In short with CRAP (DRM) you can purchase content under one terms of agreement, that you agreed to, and then the company locks you out of your purchase until you click "I agree" to new terms which you don't agree to. That my friend is contract of cohesion and typically would not be binding. The sick part is you would be legally prevented from unlocking the content you legally purchased.
          Edward Meyers
          • Need to proofread my post better

            That last part should be [url=http://dictionary.law.com/definition2.asp?selected=2325] contract of adhesion[/url] instead of contract of cohesion. You get the point though.
            Edward Meyers
          • Myopic

            In the face of rampant theft through peer to peer, the diligent
            consumer advocate will continue to fight on behalf of the
            consumer because consumer advocacy is his role. The peer to
            peer theft has been largely one sided however. It's been a
            reaction to cosumers feeling that they've been taken advantage
            of by industry lobbies. It's also been a mob-rule looting session.
            It's enough to say that these are opposing forces and legal
            leverage is being pursued on both sides. What I don't
            understand are these persecution fantasies and the myopic
            vision of fair use.

            Are we now guilty until proven innocent. In the context of bit
            ownership, Yes, I'm afraid so. It might have something to do
            with the theft of millions in ceative content. It continues as we
            speak. Is the morally virtuous man prepared to admit that
            despite his piety, the market is unsustainable without content
            protection that exceeds conventional wisdoms? Depends who
            you talk to.

            The cost of knowing the terms is one song (99 cents). To some
            this is excessive. To some the fear of being taken advantage of
            is greater than the component of trust required to engage this
            new market. My feeling is, the law is behind the market's
            progress and futher preceedents will need to be set. In any
            event, the law is being broken by both sides and the
            sanctimonious nature of the consumer advocate's stance does
            little but spread personal prejudice.

            We are in the gestational phase of a new marketplace. Apple is
            in the forefront. Time, testing and trust is required. These issues
            expand beyond narrow legal definitions and become sociological
            phenominons. Is the population honest? Yes? No? Sometimes?
            The truth is more complex than your implications. The
            consumer is not a paragon of virtue any more than industry is a
            nefarious satan. The white hat/black hat fantasy is the enemy of
            the inevitable compromise. The doomsday scenareo in which our
            rights to our collections are suddenly yanked out from under us?
            This has to be allowed to happen (or not). Without these legal
            tests, the fundamental energy recovery that will redefine our
            market and distribution networks will languish in a paranoid
            stalemate.

            So get ready with your "told ya so's" and please understand that
            this forum is not a court of law. It's an exchange of opinion. The
            legal citations are not called for as nothing will be "proven" in
            this particular theatre. I'm interested in your opinion and will
            trust your interpretations to be accurate. This may be
            considered something new.
            Harry Bardal
          • Again with the Fair Play prevents piracy myth

            Ask yourself this... iTunes has menu options to burn a list of iTunes onto a unprotected CD in which files can be created to be shared over the internet. With this in mind how can you argue seriously that the purpose of Fair Play is to prevnt piracy when in fact it specifically allows it.

            [i]Are we now guilty until proven innocent. In the context of bit
            ownership, Yes, I'm afraid so. It might have something to do
            with the theft of millions in ceative content. It continues as we
            speak. Is the morally virtuous man prepared to admit that
            despite his piety, the market is unsustainable without content
            protection that exceeds conventional wisdoms? Depends who
            you talk to. [/i]

            The DMCA was proposed in 1993 Napster was released in 1999. The DMCA was passed in 1998 a year before Napster. DRM schemes and laws to protect such were proposed well before p2p and is not a reaction to such.

            The White papre directly targeted Doctrine of First sale, this and fair use and vendor lock-in is the true target of DRM. Not the prevention of piracy.

            [i]The cost of knowing the terms is one song (99 cents). To some
            this is excessive. To some the fear of being taken advantage of
            is greater than the component of trust required to engage this
            new market. My feeling is, the law is behind the market's
            progress and futher preceedents will need to be set. In any
            event, the law is being broken by both sides and the
            sanctimonious nature of the consumer advocate's stance does
            little but spread personal prejudice.[/i]

            That is not the deal as you must agree that your songs may become unplayable at the whim of apple as are which devices you can play your song on- all at the whim of one vendor which has already changed its terms once.

            The fact that such "deals" allow the seller to change the terms at their liesure, including locking you out of your purchase, and that they have already done so once shows how much we should trust them.

            [i]The doomsday scenareo in which our
            rights to our collections are suddenly yanked out from under us?
            This has to be allowed to happen (or not). Without these legal
            tests, the fundamental energy recovery that will redefine our
            market and distribution networks will languish in a paranoid
            stalemate.[/i]

            this is not a scenerio, it has already happened with one Microsoft store. This is Fact and is not paranoia.

            [i]It's an exchange of opinion. The
            legal citations are not called for as nothing will be "proven" in
            this particular theatre. I'm interested in your opinion and will
            trust your interpretations to be accurate. This may be
            considered something new.[/i]

            the legal citations are needed becuase most people are using the RIAA/MPAA/BSA Eductaion materials as thier foundation and source of information. The BSA materials claim that you must license all software you use which is a bald faced lie as some software makers do release even today software which only bears a copyright notice and nothing else and in the case of GPLed software the GPL states very early on that the license does not cover use at all.

            With the RIAA materials they claim that there is no such thing as any legal non-paid download. This is also a bald face lie as the [url=www.archive.org]Internet Archive[/url] indeed does have a large collection of legal free downloads. MP3.com, before it was sold, also had many legal free downloads put on the site by the very artist created the music. Many bands also offer free downloads.
            Edward Meyers
    • Or consumer choice?

      The iPod environment (including the iTunes Store) is an odd
      example to use when talking about monopolies because its
      success has been driven totally by consumer choice. Individual
      consumers have made individual choices and they have added
      up to a big share of the legal download market - and the MP3
      player market. Because this market share is totally based on
      individual consumer choices it shows that Apple has understood
      the market far better than the competition and has delivered
      fully integrated products that are, for these consumers, a far
      more elegant choice.

      It's somewhat important to recognize, however, that the iTunes
      Store is only a small part of the music world. I would guess that
      illegal downloads still have far higher volumes and then there is
      always the basic CD market. Overall, the iTunes Store has a far
      less percentage of the total music environment than the 88%
      people seem to focus on. How that percentage changes will be
      based on what the competition does, not what Apple does.
      Ken_z
  • Enough with the stupid phones.

    Why are people so enamored with phones?
    Give me a break. Sheesh!
    systemx
  • Guess you don't use iTMS:

    "Although what Apple should really be doing is keeping a record of everything you've purchased so that you can re-download it if you have to (a feature that the Navio platform has)."

    Look at your menu. There is a drop-down that will re-download all purchased items from the store. I just did that with my G5 on Saturday (iTunes 6).
    nomorems
    • Correction?

      if this is correct, I'll change the story. I stopped using iTunes a long time ago. But I've gotten many emails about this feature missing. Can others confirm/deny (thanks in advance) that iTunes 6 solves this problem?

      db
      dberlind
  • Defining the market

    Yes, Apple owns the music download market. But does that make them 1) a monopoly, and 2) an abusive monopoly?

    iTunes songs (which I don't purchase, by the way) can be used in "portable" form only on players made by Apple. Is this any different from Xbox games that can only be played on an Xbox? From PS2 games that can only be played on a PS2? Should MS and Sony have to open up their proprietary game formats so other companies can make gaming boxes that play their games? How is this any different from what Apple is doing?

    And the obvious question is where is the consumer harm being done? It's not being done by the lock-in. It's being done by the DRM. If you can get DRM declared illegal, great, but then that should apply to all companies using any form of DRM whatsoever.

    As a consumer, can't I pretty much buy all of the same songs sold by Apple from another company, for use on another player, for the exact same price or less (via subscription model)? How am I being harmed here?
    tic swayback
    • The DRM enables the lock in

      For the most part video and music downloads use standardized CodeC's. What locks you to one device or another is the DRM. In the case of iTunes the music file is [url=http://en.wikipedia.org/wiki/Advanced_audio_coding]ACC[/url], which other players can play FYI , and the DRM is Fair Play , which prevnts those other players from playing the ACC file.

      [i]Yes, Apple owns the music download market. But does that make them 1) a monopoly, and 2) an abusive monopoly?[/i]

      If they own the market then they are a monopoly. Monopoly power is regulated. [url=http://www.usdoj.gov/atr/public/testimony/hhi.htm]HHI[/url] is used to define the effect of Monopoly power in any given Market. There are [url=http://www.unclaw.com/chin/teaching/antitrust/herfindahl.htm]online HHI calculators[/url].

      Something to note here is that just having a monopoly is not ilegal. What is ilegal is when as a Monopoly, or even in some cases as a non-monopoly, induce/engage in certain activities. Refer to the [url=http://www.usdoj.gov/atr/foia/divisionmanual/two.htm#a3]Clayton Act[/url] and [url=http://www.usdoj.gov/atr/foia/divisionmanual/two.htm#a1]Sherman Act[/url].

      [i]iTunes songs (which I don't purchase, by the way) can be used in "portable" form only on players made by Apple. Is this any different from Xbox games that can only be played on an Xbox? From PS2 games that can only be played on a PS2? Should MS and Sony have to open up their proprietary game formats so other companies can make gaming boxes that play their games? How is this any different from what Apple is doing?[/i]

      Yes it is differnt. The file format, ACC , can be played on RealPlayer, WinAmp, Sony Ericsson S700i, Sony Ericsson W600/Sony Ericsson W550, Sony Ericsson K510i, Sony Ericsson K750i/Sony Ericsson W800, Sony Ericsson W810, Sony Ericsson W900i, Nokia N91, Nokia 3250, Nokia 3300, Nokia N70, Nokia 6270, Samsung SGH-i300, Motorola ROKR E1, Motorola RAZR V3i, Motorola RAZR V3x, Motorola SLVR L7, Siemens M75, Siemens CX75, Siemens EL71, and there are more. The iTunes songs won't play on these devices however becuase of Fair Play DRM.

      It's not the same thing.

      [i]And the obvious question is where is the consumer harm being done? It's not being done by the lock-in. It's being done by the DRM. If you can get DRM declared illegal, great, but then that should apply to all companies using any form of DRM whatsoever.[/i]

      The consumer is harmed in two ways.

      1. They are locked into buying only devices that are aproved to play the DRMed ACC files although many devices on the market can play ACC.

      2. Consumer confusion. It isn't just 2 types of DRM the consumer has to know which type of DRM system his/her device will play. Some labels have rolled their own and also With Microsoft's formats their are WMA players that can't do Play's For Sure.

      3. The DRM prevents more than just playback on "approved" devices and OSes. I have a fairly long list.... if you really want it.

      [i]As a consumer, can't I pretty much buy all of the same songs sold by Apple from another company, for use on another player, for the exact same price or less (via subscription model)? How am I being harmed here?[/i]

      I think iTunes does have a few bands which are only releasing on iTunes... not sure on that.

      Also Apple isn't the only one offering purchased downloads. WalMart, among other stores, offers $.88 Microsoft format purchased downloads also. It's not a choice of purchase your download or have a subscription service.
      Edward Meyers
      • That's sort of what I'm asking

        Let's take a hypothetical and do away with the DRM. If Apple was using an Apple-only file format for their downloaded songs, a file format that was only available through using iTunes or an iPod, would people still have the same objections? If Apple creates something called AAC2 or whatever, that locks you in just as badly as FairPlay does, would that somehow be more legal and less problematic than using a common file format and DRM?

        Which is why I brought up the videogame systems. No one seems to have an issue with them for essentially doing what I mention above. Where is the line drawn? Why is a proprietary file format okay, but proprietary DRM on top of an open file format is not okay?

        ---Also Apple isn't the only one offering purchased downloads.---

        Yes, I knew that, I mentioned subscriptions in addition as a way to get music more cheaply than a 99 cent download.
        tic swayback
        • Not the same

          To begin with ask yourself this;

          1. How many differnt stores can I buy XBox/Nintendo/Sony games at?

          2. How many stores can I buy iTunes at? Who owns that store?

          Next there is the issue that Microsoft , Sony, and Nintendo do allow others to make and distribute games for their systems. Sega, Atari, Konami, EA, Ect, Ect. Apple doesn't allow anyone but themselves to produce and distribute iTunes.

          The fact of the matter is that ACC is a standard format but Fair Play limits which devices you can play the "protected" ACCs on. The DRM, advertised as copy Protection, is not copy protection at all. The DRM allows you to copy the songs and does nothing to prevent it... In fact you can copy your iTunes onto an unprotected CD using the iTunes software. If the copy protection allows you to copy the music then why is it there?

          Finally, one of the reasons why the iPod/iTunes is popular right now is becuase;

          1. The iPod does play other standardized formats, such as MP3.

          2. iTunes does allow you to burn your song to an unprotected CD.

          The problem is that under the contract terms in which Apple allows you to use both this can change at any time.
          Edward Meyers
          • Still not clearly answering the question

            ---1. How many differnt stores can I buy XBox/Nintendo/Sony games at?
            2. How many stores can I buy iTunes at? Who owns that store?---

            I can buy iTunes gift certificates all over the place. BestBuy sells them, to name just one.

            And I can buy the same songs at many different stores. The exact same songs that I can put on my iPod. What's the difference?

            ---Next there is the issue that Microsoft , Sony, and Nintendo do allow others to make and distribute games for their systems---

            And Apple allows others to make songs for the iTunes store and shares the (majority of the) profits with them. They are also non-discriminatory as far as accepting content from others.

            ---The fact of the matter is that ACC is a standard format but Fair Play limits which devices you can play the "protected" ACCs on.---

            One thing I find odd is that no other mp3 player seems to be interested in licensing AAC. Pretty much everything you listed earlier were phones.

            ---If the copy protection allows you to copy the music then why is it there?---

            It's there because the RIAA demands it be there. Apple has turned something they were originally against into a tool used to lock in users. The reason the RIAA wants it to be there is to force you the user to pay for things you normally get for free.

            But that all ignores my question:

            If Apple did away with DRM altogether, but went with a proprietary Apple-only file format for sold music, an iPod only format, would you still be claiming they're in violation of antitrust laws? They'd be just like the videogame companies at that point. They'd allow others to make content in their format, but no one else could use that file format on their machines. You are just as locked in to the Xbox or the PS2, but no one seems to be complaining there.

            ---Finally, one of the reasons why the iPod/iTunes is popular right now---

            The iTunes store isn't all that popular. 4-5% of music sales is not a big deal. If you want to talk popular, then you're talking about p2p, with 70,000,000 users.

            ---The problem is that under the contract terms in which Apple allows you to use both this can change at any time.---

            Yep, this is called "renewability", good comments on it here:
            http://craphound.com/cdtdrmresponse.txt
            tic swayback
        • Agreed

          I'm wondering exactlly where the beef is as well. AAC could have
          been WMA. If Dolby/Fraunhofer have a beef with Apple for
          adding DRM, it's their business. Proprietary formats are the rule
          not the exception. The marketplace chooses it's preference, the
          terms are common knowledge.

          The shrink wrap argument is as thin as the shrink wrap itself.
          Consumers can't protect themselves from the transaction any
          more than they can protect themselves from a given piece of
          gear's obsolescence. It's buyer beware as always. claims are
          made and either validated or reneged on. Value and risk are
          subjective. The right to transfer, copy, or make screen shots are
          not constitutional guarantees. If relinquishing these rights is our
          new deal with the devil, then it's ours to make.

          The music industry can't sustain itself if it's product is given
          away. People are rejecting subscriptions because the impulse to
          covet is too great. The advertising model won't be tolerated
          within a "owned" thing. Artists can either sell protected product
          (protected by virtue of DRM or magnetic strip), or create a model
          in which consumers prepay or bid for talented creators effort
          and live with whatever product ensues. If that's not good
          enough, it's back to banjo lessons and kitchen jams. One things
          for certain, the consumer advocate makes hay by extolling the
          avarage consumer's virtue and innocence, but the massive
          looting of creative content through peer to peer represented
          millions of acts of theft and talk of illegalities should begin
          there. We've proven ourselves collectively untrustworthy.

          I truly believe this is Microsoft inspired paranoia being
          superimposed on Apple success. Monopoly and illegal monopoly
          differ as much as anything considered legal vs illegal. If the line
          get's crossed it's an issue. Is the spectral notion of consumer
          abuse is a valid concern... persecution fantasy, or something in
          between. Let's wait and see.
          Harry Bardal
          • DRM does not prevnt piracy

            Again you are working from a Faulty premise that DRM prevents piracy. It does nothing of the sort.

            Fair Play allows you to burn your playlist as a DRM-Less CD from which anyone can easily convert the songs back into files anbd share over the internet.

            Your argument is Null and Void on the reason for it being there.

            In fact what you are proposing is that we should sign away rights without getting anything in return.

            Also the argument that DRMed music rewards the artist is also void. The amount that they recieve per download, when the labels even remeber to pay it that is, is a about $.05 per download.


            Finaly, to say that becuase the major labels would not relrease songs without DRM means there would be no music downloads at all is also Null. Not to mention several bands themselves allow live-taping of their songs at thier concerts, evcen set up areas up front for the tapers, and then encourage them to share them over the internet, including over P2P services. This was prior to iTunes.


            I can make a bigger argument that the only reason why Apples store is number 1 is becuase Apple themsleves includes methods to circumvent the DRM right in their own software.
            Edward Meyers