Trouble snowballs for Sony

“The spyware controversy won’t go away for Sony. On Thursday, it came to light that the state of Texas is expanding its claims against the company. It’s now saying that some of Sony’s products — using a different technology altogether from the one that caused the first controversy — secretly downloaded programs onto users’ machines even if they rejected license agreements,” Alyce Lomax reports for The Motley Fool. “Back in November, the Sony BMG unit got into hot water over its XCP technology included on some of its musical CDs, that planted what are called “rootkits” to users’ computers without their knowledge. The situation reached a high profile — and incited some degree of consumer outrage — when it was discovered that the technology made users’ PCs vulnerable to hackers.”

Lomax reports, “The new charge from Texas, as reported by CNET, pertains to Sony’s MediaMax technology, which some say allows Sony to keep tabs on what users are doing with their music (which, of course, is the goal of copy protection — to prevent users from making too many copies), even if the users rejected the license agreement upon installation. Furthermore, the attorney general from Texas said that both the XCP and the MediaMax technologies can make users’ computers vulnerable to attacks.”

“It’s not lost on anyone that the once-famed creator of the Walkman lost the portable musical crown to Apple and its iPods,” Lomax writes. “It seems that many investors still retain a lot of belief in electronics giant Sony, given that its stock price continues to go up. And get this — it currently has a forward P/E ratio of 73. I just can’t help thinking there’s bad news ahead for this electronics giant, especially when it comes to this spyware controversy, which suggests a lack of concern about customers or their rights. It seems to me that these concerns should be enough to make at least some shoppers cast a jaundiced eye toward many of Sony’s products. Some are likely going to avoid them altogether.”

Full article here.
Sony has lost its way so badly, we don’t know if they’ll ever be able to find their way back to their roots again. We are continuing to boycott all Sony products until this and other “copy-protected CD” issues are addressed appropriately by Sony and recommend that our 2.2+ million unique visitors per month from 136 countries worldwide do the same.

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Related articles:
Apple tramples Sony in Japan: iPod grabs 60-percent share of DMP market, Sony drops under 10-percent – December 22, 2005
Texas expands tainted CD lawsuit against Sony BMG – December 21, 2005
Texas sues Sony BMG for ‘spyware’ on CDs – November 21, 2005
Sony Boycott continues: Sony recalls XCP-tainted music discs, offers Red Book compliant CD exchanges – November 17, 2005
Boycott Sony – November 14, 2005
Sony BMG ‘temporarily suspends’ production of music CDs with copy-protection scheme – November 11, 2005
Boycott Sony products: Sony music CDs can install kernel extensions on Mac OS X – November 10, 2005
Computer security firm: ‘Stinx’ virus hides within Sony’s copy protection scheme – November 10, 2005
Sony sued over copy-protected CDs – November 10, 2005
SonyBMG antics may well cause public to turn on them and turn many people onto Apple Macs – November 06, 2005
Report: Sony copy-protected CDs may hide Windows rootkit vulnerability – November 01, 2005
Analyst: Sony BMG’s boycott of Apple’s iTunes Music Store Australia won’t last long – October 24, 2005
Apple launches iTunes Music Store Australia – October 24, 2005
Japan music labels look to impose ‘iPod Tax’ while Sony, Warner still not signing with Apple iTunes – October 10, 2005
Why aren’t Sony, BMG, Warner, Victor making their artists’ music available on Apple’s iTunes Japan? – October 06, 2005
Sony and Warner holding out on Apple iTunes Music Store Australia – September 08, 2005
Musicians stage mutiny against Sony, defiantly offer music via Apple’s iTunes Music Store – August 10, 2005
Record company causes Apple to hit ‘pause’ on Australian iTunes Music Store – May 05, 2005

22 Comments

  1. I’m done with Sony, especially when i get ready to buy my big TV for ‘the big game’ (sorry real event name omitted because i don’t want to get sued by the NFL for using the name that rhymes with “Pooper Mole”.)

  2. I’m interested to know whether the artists who’s CD’s have been recalled are being compensated or not? For instance, my wife tried to buy me the latest Neil Diamond CD (laugh it up!) but couldn’t find it because of the recall. Imagine the lost sales over the holiday season for some of these artists. Good news for Apple & the iTunes Music Store but bad news for the artist since over the counter CD sales are still the main source of their income.

    Geez, just wait for the lawsuits to start coming from Sony’s very own artists.

  3. It’s true that their music division has itself in hot water, but I don’t believe the other divisions are connected in any way. I remember an article a while back mentioning how their first digital music players were limited because of disagreements between them. In my opinion, I’m not blaming sony electronics for sony music’s mistakes.

  4. Spotted this article in the NZ Herald business section today

    http://www.nzherald.co.nz/section/story.cfm?c_id=3&ObjectID=10361158
    Sony soars on royal rumour

    23.12.05

    TOKYO – Sony shares rose as much as 7.5 per cent after Saudi Prince Alwaleed bin Talal, the world’s fifth-richest man, said he was considering buying shares in the world’s second-biggest consumer electronics maker.

    Sony’s stock gained 3.4 per cent to 4550 after rising as high as 4730. Sony is expecting its first annual loss in 11 years as it lost share to Apple Computer and Sharp in key electronics products such as music players and flat-panel TVs.

    The Tokyo-based company can revive earnings under its new chief executive Howard Stringer, just as Carlos Ghosn turned around Nissan Motor, Alwaleed said.

    The prince, chairman of Kingdom Holding in Riyadh, said he is examining future prospects for Sony’s share price and earnings.

    – BLOOMBERG

  5. i know its fun to rag on sony for any reason possible , but they have ceased production of the evil copy protected cds, and offered anyone who has one a replacement with a normal one.

  6. stephen T-

    I not ragging Sony; I’m just not buying any of their products ever again. What they did is outrageous. They had to be pounded to get them to stop. Do I feel sorry for their artists? No, they consented to this over-reaching, outrageous -yeah, I said that before- scheme.
    Not buying Sony. Ever. Yeah, and I wrote them that -quite a while ago.

  7. When will these idiots realize that the cheap bastards who steal music illegally wouldn’t buy their music anyway. Pirated music is not lost sales.

    Sales are going down because the product is just not there anymore. Most of the tunes on almost every CD are just mediocre at best.

    Willie Nelson is an exception though.

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