Apple facing antitrust inquiry into music store practices

The U.S. Justice department has begun a preliminary antitrust inquiry into Apple's business practices in relation to its iTunes Music Store; the New York Times reports.

Apple controls 69 percent of the online music sales market and is allegedly using its dominant position to control exclusive access to new music. Amazon.com has been in negotiation with several music labels to provide exclusive content one day before general sale through its "MP3 Daily Deal" program. It is alleged that Apple has been requesting labels not participate in this exclusivity deal with Amazon, while punishing labels that did not comply.

The vintage Apple advertisement, "1984" depicting an Orwellian scene in which Apple is fighting back against "the man" has been the defining attitude and view of the company for several decades. Recently however, with Apple's imposing control of the online music, app and possibly future e-book markets; along with strict app and content criteria, Apple may have become who they were fighting.

The DoJ seems to think so, as government regulators are beginning to scrutinize Apple's dominant market power with the antitrust comb. This is the latest in a string of investigations regarding Apple, including an FTC investigation regarding Apple's control over developers for the iPhone platform, and another investigation by the DoJ regarding hiring practices and non-compete agreements.

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Normally I would hate Apple for punishing a company that didn't play by their rules, but when it comes to record companies....well, anyone that can kick them in the jewels once in awhile should

Good stuff. Apple wants to me like MS...they are getting more and more like the OLD MS every damn day. Its funny how people keep defending their actions. Typical fanboyism.

techbeck said,
Good stuff. Apple wants to me like MS...they are getting more and more like the OLD MS every damn day. Its funny how people keep defending their actions. Typical fanboyism.

typical troll. you bash on apple for doing anti competitive things and then come on this post to bash on apple more even though this post is about apple doing something against companies being anti competitive. typical hypocritical troll.

SputnikGamer said,

typical troll. you bash on apple for doing anti competitive things and then come on this post to bash on apple more even though this post is about apple doing something against companies being anti competitive. typical hypocritical troll.

He trolls every Apple post. Very rarely does he make a solid argument. Most of the time its just pointless drivel driven by his hate for Apple.

He is right. Apple are becoming like the MS of old. I know it's a bit painful for Apple fans to admit because slagging off Microsoft is part of their religion, but it is actually true.

Subject Delta said,
He is right. Apple are becoming like the MS of old. I know it's a bit painful for Apple fans to admit because slagging off Microsoft is part of their religion, but it is actually true.

Yep,
Have to agree.

Finally it happens. Market share percentage or not, when a company is raking in billions due to having access to "illegal" practices that other companies may not use, it's just not right. I say the word "illegal" because other companies have been fined and broken up for doing things apple has pushed to the max.

"Amazon.com has been in negotiation with several music labels to provide exclusive content one day before general sale through its "MP3 Daily Deal" program. It is alleged that Apple has been requesting labels not participate in this exclusivity deal with Amazon, while punishing labels that did not comply."

So Apple are trying to *stop* the exclusivity deals, and they go after them?

It's not right for Apple to punish record companies who don't toe the line, but I don't think Amazon's attempts to monopolise on new music should be ignored..

So did I read that right? Amazon wanted labels to only sell their music through Amazon and not competitors and Apple told them not to do it and let everyone sell their music and Apple gets hit with anti Trust lawsuit? Apple is being investigated for stopping Amazon from having a monopoly? lol

SputnikGamer said,
So did I read that right? Amazon wanted labels to only sell their music through Amazon and not competitors and Apple told them not to do it and let everyone sell their music and Apple gets hit with anti Trust lawsuit? Apple is being investigated for stopping Amazon from having a monopoly? lol

Umm.. not quite...

"It is alleged that Apple has been requesting labels not participate in this exclusivity deal with Amazon, while punishing labels that did not comply."

So it's more a long the lines of 'Come with us or be killed."

Edited by mpmc, Jun 1 2010, 2:44pm :

SputnikGamer said,
So did I read that right? Amazon wanted labels to only sell their music through Amazon and not competitors and Apple told them not to do it and let everyone sell their music and Apple gets hit with anti Trust lawsuit? Apple is being investigated for stopping Amazon from having a monopoly? lol

It's only for the 'one day before general release' thing, as in, you can go to Amazon to get stuff a day early.

Laura said,

It's only for the 'one day before general release' thing, as in, you can go to Amazon to get stuff a day early.

but a monopoly for a day is still a monopoly? i can understand why apple would get in trouble for the punishing the labels thing but how can amazon get away with doing something that is anti competitive. if amazon is making "exclusivity deals" they are making it impossible for anyone else to compete during that time.

And how was apple going to "punish" them ? By not selling the labels music o_0

Something tells me Amazon's deal fell through and they are trying to shift the blame to someone else.

SaltLife said,
This was on cnn a week ago, they started an inquiry, but have found nothing.

inquiries can take months if not years..... the MS one took a very long time before it went to an anti-trust case

Good. They need a slap in the face. Apple needs the same treatment as Microsoft has gotten in the past.

By the way this comment is posted using my iPad

lflashl said,
didnt they do such a thing, and thats why they have a non IE version of windows in the EU?

You need to do more research, the non IE version was scrapped when Microsoft introduced the Ballot Screen.

Apple has the right to dictate development within their own ecosystem and on their various platforms; and the Hollywood mandated DRM is the only hard lock on content obtained through iTunes.

Apple is not infringing on the music or movies industry, competitors are becoming upset that iTunes owns 70% of music purchased online. The government should investigate why four record companies own a monopoly on over 90% of mainstream music in the United States.

This investigation is poorly thought out. Apple has done nothing illegal or even suspicious.

jps0910 said,
Apple has the right to dictate development within their own ecosystem and on their various platforms; and the Hollywood mandated DRM is the only hard lock on content obtained through iTunes.

Apple is not infringing on the music or movies industry, competitors are becoming upset that iTunes owns 70% of music purchased online. The government should investigate why four record companies own a monopoly on over 90% of mainstream music in the United States.

This investigation is poorly thought out. Apple has done nothing illegal or even suspicious.


Spoken like a true Apple supporter, if Microsoft locked Windows down so you could only use their dev tools to create programs for the OS or that you could only use Microsoft hardware with Microsoft OS they would be destroyed quicker than you can say european union.

Edited by Richard Hammond, Jun 1 2010, 8:34am :

Richard Hammond said,

Spoken like a true Apple supporter, if Microsoft locked Windows down so you could only use their dev tools to create programs for the OS or that you could only use Microsoft hardware with Microsoft OS they would be destroyed quicker than you can say european union.

+1
soooo true.

jps0910 said,
Apple has the right to dictate development within their own ecosystem and on their various platforms; and the Hollywood mandated DRM is the only hard lock on content obtained through iTunes.

Apple is not infringing on the music or movies industry, competitors are becoming upset that iTunes owns 70% of music purchased online. The government should investigate why four record companies own a monopoly on over 90% of mainstream music in the United States.

This investigation is poorly thought out. Apple has done nothing illegal or even suspicious.

LOL logic fail, there are 4 companies controlling 90% of the mainstream music, the point is there are 4 companies, not 1 aka not monopoly.......
Lets face it Apple LOVED the drm, it meant you HAD to buy ipods to play music over their store, the BS about apple hating it is BS. They are not exactly known for free unlocked crap for all....
Such a fanboy.... such a fail....

Edited by ZeroHour, Jun 1 2010, 9:24am :

jps0910 said,
Apple has the right to dictate development within their own ecosystem and on their various platforms; and the Hollywood mandated DRM is the only hard lock on content obtained through iTunes.

Apple is not infringing on the music or movies industry, competitors are becoming upset that iTunes owns 70% of music purchased online. The government should investigate why four record companies own a monopoly on over 90% of mainstream music in the United States.

This investigation is poorly thought out. Apple has done nothing illegal or even suspicious.

Clearly, you are not grasping the issue. This is not because Apple has a monopoly, or in actual fact, a near monopoly, on digital music distribution. This is because Apple is abusing said quasi-monopoly status to quash competition. Read the original post again.

Amazon.com has been in negotiation with several music labels to provide exclusive content one day before general sale through its "MP3 Daily Deal" program. It is alleged that Apple has been requesting labels not participate in this exclusivity deal with Amazon, while punishing labels that did not comply.

This is what is being investigated. This is the alleged monopoly abuse that is at issue.

Edited by The Skeptical Canuck, Jun 1 2010, 12:55pm :

jps0910 said,
Apple has the right to dictate development within their own ecosystem and on their various platforms; and the Hollywood mandated DRM is the only hard lock on content obtained through iTunes.

Apple is not infringing on the music or movies industry, competitors are becoming upset that iTunes owns 70% of music purchased online. The government should investigate why four record companies own a monopoly on over 90% of mainstream music in the United States.

This investigation is poorly thought out. Apple has done nothing illegal or even suspicious.

Using shady business practises to coerce record labels into favouring you over another competitor is illegal, what part of this, exactly, is lost on you?

Personally I now use Amazon MP3 for most of my music, it is much better quality than the stuff offered on iTunes

jps0910 said,
Apple has the right to dictate development within their own ecosystem and on their various platforms; and the Hollywood mandated DRM is the only hard lock on content obtained through iTunes.

Apple is not infringing on the music or movies industry, competitors are becoming upset that iTunes owns 70% of music purchased online. The government should investigate why four record companies own a monopoly on over 90% of mainstream music in the United States.

This investigation is poorly thought out. Apple has done nothing illegal or even suspicious.

Also I believe a few years back INTEL got whacked with fines for telling Dell and the likes to not use AMD products or they will get punished... this is basically the same thing Apple is doing by telling music labels not to participate in Amazon's deals or they will get punished.

Richard Hammond said,

Spoken like a true Apple supporter, if Microsoft locked Windows down so you could only use their dev tools to create programs for the OS or that you could only use Microsoft hardware with Microsoft OS they would be destroyed quicker than you can say european union.

QFMFT

YEA! and what about this not being able to your music if you have lost it! my sister laptop HD died on her and she lost alot of music she paid for, went to redownload it and had issues with trying to find out what she paid for, and then when she went to download it again she had to pay for it! This doesnt happen on the apps then why music!!

lflashl said,
YEA! and what about this not being able to your music if you have lost it! my sister laptop HD died on her and she lost alot of music she paid for, went to redownload it and had issues with trying to find out what she paid for, and then when she went to download it again she had to pay for it! This doesnt happen on the apps then why music!!

I've bought from iTunes once, and never again - for this exact reason!

duddut2 said,

I've bought from iTunes once, and never again - for this exact reason!

yea my sister ended up on p1r@teb@y then get back all the music she downloaded, and doesnt buy from them anymore!!

lflashl said,
YEA! and what about this not being able to your music if you have lost it! my sister laptop HD died on her and she lost alot of music she paid for, went to redownload it and had issues with trying to find out what she paid for, and then when she went to download it again she had to pay for it! This doesnt happen on the apps then why music!!

I don't like itunes either....but you can get the music back. Do a search on apples itunes FAQ on their website. You email them and then they give you permission to download. I know it works because I've done it for my mom when she lost over $100 of purchased music.

lflashl said,
YEA! and what about this not being able to your music if you have lost it! my sister laptop HD died on her and she lost alot of music she paid for, went to redownload it and had issues with trying to find out what she paid for, and then when she went to download it again she had to pay for it! This doesnt happen on the apps then why music!!

This isn't an Apple issue. Blame the music companies. They don't want you to be able to easily download your music again. If you lose a CD can you go back to Wal Mart and get another copy for free? Apple at least lets you download it again if you go through the proper steps. I think that's more than fair. As for apps, it's different because its software. If you lose your copy of Windows, Office, Photoshop, etc., but still have your serial code, you can just borrow someone's disk and reinstall with your code. Essentially when you buy software, you're really paying for the serial code. Lots of software you can download for free as a trial. With apps, your AppleID is essentially your serial code. Lose an app and you can download it again because you have the serial code.

asdavis10 said,

This isn't an Apple issue. Blame the music companies. They don't want you to be able to easily download your music again. If you lose a CD can you go back to Wal Mart and get another copy for free? Apple at least lets you download it again if you go through the proper steps. I think that's more than fair. As for apps, it's different because its software. If you lose your copy of Windows, Office, Photoshop, etc., but still have your serial code, you can just borrow someone's disk and reinstall with your code. Essentially when you buy software, you're really paying for the serial code. Lots of software you can download for free as a trial. With apps, your AppleID is essentially your serial code. Lose an app and you can download it again because you have the serial code.

This would be true if the sony music store didnt literally let you redownload your music. Apple dont want to do it as it would affect their margins basically.

asdavis10 said,

This isn't an Apple issue. Blame the music companies. They don't want you to be able to easily download your music again. If you lose a CD can you go back to Wal Mart and get another copy for free? Apple at least lets you download it again if you go through the proper steps. I think that's more than fair. As for apps, it's different because its software. If you lose your copy of Windows, Office, Photoshop, etc., but still have your serial code, you can just borrow someone's disk and reinstall with your code. Essentially when you buy software, you're really paying for the serial code. Lots of software you can download for free as a trial. With apps, your AppleID is essentially your serial code. Lose an app and you can download it again because you have the serial code.

This is a weak argument, if I'm logged in and the store can see I've previously paid money for a track, and I'm trying to access that track that I've paid for, why should it stop me?

I'm using spotify right now, very good value, music sync between desktop app and phone, reasonably priced and wide selection. This is the best method Ive found to date that doesn't require torrents (which is the ultimate in user friendliness and freedom to do what you want with what you have).

Make the model user friendly, make it as good as torrents, make it so that I buy something and I don't have to buy it again (as in any other format - I buy a track/movie/tv show etc and that should be that!), stop using old analogies like physical CD's as this is not relevant, make it cross platform, open and soon there wont be a 'problem' of copyright infringement, until then the only winners are lawyers!

ZeroHour said,

This would be true if the sony music store didnt literally let you redownload your music. Apple dont want to do it as it would affect their margins basically.

Eh. Amazon is a one time download only system too. I am pretty sure this is a music industry restriction rather than an Apple/Amazon one. If they don't want to ruin their margins, why allow people to buy once, download forever in the App Store?

ZeroHour said,

This would be true if the sony music store didnt literally let you redownload your music. Apple dont want to do it as it would affect their margins basically.

Sony is a also a record label. Ever thought about that? How would it affect Apple's margins since they'd be letting you download something again for free? Your argument makes no sense.

duddut2 said,

This is a weak argument, if I'm logged in and the store can see I've previously paid money for a track, and I'm trying to access that track that I've paid for, why should it stop me?

Amazon doesn't allow multiple downloads. It is a music industry thing. Plain and simple.

Make the model user friendly, make it as good as torrents, make it so that I buy something and I don't have to buy it again (as in any other format - I buy a track/movie/tv show etc and that should be that!), stop using old analogies like physical CD's as this is not relevant, make it cross platform, open and soon there wont be a 'problem' of copyright infringement, until then the only winners are lawyers!

The analogy is relevant. If a digital album costs the same as a physical disk, why do people feel the they are entitled to downloading the album over and over again? You don't get to keep going to your record store and keep picking up copies of an album. As if bandwidth, server costs, etc shouldn't be factored into each download.

boo_star said,

Eh. Amazon is a one time download only system too. I am pretty sure this is a music industry restriction rather than an Apple/Amazon one. If they don't want to ruin their margins, why allow people to buy once, download forever in the App Store?

ughh I cant believe I have to actually explain how apple would have extra costs from people redownloading music, bandwidth is not free!
Unlike music apple gets 30% revenue of app store sales which is a hell of a lot of margin to allow redownloads.

Ryoken said,
It's annoying, but if you loose a CD you are SOL too, so it's really not something to bitch about.

This isn't the same at all. If you could just backup your purchased music, and say after a format or purchasing a new computer, copy them over and you'd be fine, this would be a non-issue. But when your computer or CD player gives out your CD will still work fine.

Ryoken said,
It's annoying, but if you loose a CD you are SOL too, so it's really not something to bitch about.

You actually have a point. Plus is it so hard to have an automatic backup, using the 321 backup strategy (3 backups, 2 different media types, 1 off-site)

Edited by warwagon, Jun 1 2010, 4:21pm :

Tha Bloo Monkee said,

This isn't the same at all. If you could just backup your purchased music, and say after a format or purchasing a new computer, copy them over and you'd be fine, this would be a non-issue. But when your computer or CD player gives out your CD will still work fine.

What do you mean ? You can backup iTunes music, and you should, and iTunes Tells you to do that the first time you make a purchase.
When a CD gets damaged or Lost you lose all the music on it. When a computer gets damaged or lose you loose all the music on it.
It's the same.. In both cases not backing up is your fault, and in both cases the store isn't gonna give you a new copy.

Ryoken said,

What do you mean ? You can backup iTunes music, and you should, and iTunes Tells you to do that the first time you make a purchase.
When a CD gets damaged or Lost you lose all the music on it. When a computer gets damaged or lose you loose all the music on it.
It's the same.. In both cases not backing up is your fault, and in both cases the store isn't gonna give you a new copy.

I have to agree. It is the right of the store to choose how they want to handle this sort of situation. If you don't like it, buy your music elsewhere. I'm sure they'll respond to lost sales quicker than they'll respond to random complaints from the internet.

But, in the meantime, use a backup. When I buy music online, I put a copy on my MP3 player, I put a copy on my media server, and I burn a copy to disc.