“Apple Computer Inc. must face several federal and state antitrust claims arising from the operation of its iTunes online music store and the sale of its iPod digital music players, a federal judge in California has ruled. Plaintiff Thomas Slattery’s lawsuit claims Apple configured the iPod so that it will play only iTunes files and not digital music files from competing vendors of online music. Apple has also encoded its iTunes files so they will only play on the iPod and not any other digital music player, the complaint says,” Donna Higgins reports for Andrews Publications.
“The suit, filed in the U.S. District Court for the Northern District of California, seeks certification as a class action. Apple moved to dismiss all the claims, but U.S. District Judge James Ware rejected the bulk of the motion,” Higgins reports. “The plaintiff has met all the requirements for asserting a tying claim, the judge said, noting that the complaint alleges Apple has an 80 percent share of the market for legal digital music files and more than 90 percent of the market for portable hard-drive digital music players. Judge Ware rejected Apple’s argument that the tying allegations must fail because people can buy the iPod and iTunes files separately. As for the rest of the suit, the judge allowed Slattery to proceed with his monopolization claim under the federal Sherman Antitrust Act and his claims for violation of California’s antitrust and unfair-competition laws.”
More info in the full article here.
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Related article:
Antitrust suit filed against Apple, alleges iPod and iTunes Music Store illegally ‘tied’ together – January 05, 2005
Hey, Jack Miller! Where are you? It seems like it’s about time for As The Apple Turns to make a comeback, what with all the juicy courtroom drama in Apple’s future. Are you there? We miss you much!
Apple has also encoded its iTunes files so they will only play on the iPod and not any other digital music player
No, iTunes encoded songs will play on Motorola ROKR and SLVR cell phones. Apple hasn’t widely licensed FairPlay, but they have licensed.
Not to say that the iTunes software will play on any operating system.
90% of the world’s software only run if you have Windows, what about this ?
Oh, brother. I can see it now: iTunes will have to be opened to all competitors and Apple will get smacked around for such terrible monopolist tendencies (the fact that they don’t _abuse_ this monopoly doesn’t seem to matter); meantime, M$, which clearly raked consumers over the coals with their practices, is still chugging along abusing its monopoly powers every day.
Just too pathetic….
I wouldn’t be surprised if this ends up with Apple having to split into the music division into two seperate companies, one for hardware, the other for selling music.
And of course both will be forced by the courts to license WMA.
Follow the money trail.
I hate to say it, but this was inevitable.
MDN magic word; saw,,, as in ”I saw this coming.”
The original iPod played mp3’s and gave you the ability to create mp3’s from your CD’s, the new one’s still do. The other services were added later to support the iPod.
Unlike Windows programs, I can burn my AAC music to CD’s (Apple make’s that part soooo easy, it’s ridiculous) and play them ANYWHERE!
is this why the stock is tanking?
Looks like licensing Fairplay may be coming sometime soon.
Well, we all knew this would happen eventually, as long as Apple remained so dominant in the digital music industry. The good news for Apple is that these types of suits move so slowly that by the time its resolved, most of iTunes’ competitors will have gone under.
Heck, Apple is likely to twist the outcome of this suit to its advantage! If Apple is “forced” to open up either the iPod platform or the iTunes music store, that will finally establish either one as a standard, for once and for all. Competitors will be allowed their piece of the pie, but Apple will remain in control.
why couldn’t they do a better job with the Microsoft anti-trust case?
Hey,
I’m gonna file a lawsuit to make Dodge manufacture replacement parts for my Lexus…
After all, “consumers should have a ‘choice'”. Right?
This is ridiculous!
Apple is in no way obligated to have the iPod play files from competing vendors. When the iPod was launched, I don’t think there were any competing vendors. What if there were 1000 vendors with different file formats, should Apple do all that work to make sure the iPod works with all those vendors? Apple works on its own technology. It hasn’t got the time or interest to accomodate other technology. There is no reason for it. Besides the iPod does work with competing vendor music files like allofmp3.com.
Apple hasn’t encoded iTunes files so that they only play on the iPod. iTunes files have DRM (Fairplay). Software that can decode Fairplay, can play the iTunes files. That is why iTunes files play with Quicktime, which is available for Windows too. So iTunes files can play on Windows PCs, which can be considered a digital music player.
Plus of course iTunes files can be burnt on CD and ripped to any other format.
Ok then…
I’m going to sue Microsoft then because my Xbox games won’t play on a PS2 and vice versa!
I’m also going to sue XM because I can’t receive Sirius programming, and also Dish Network because I can’t receive DirecTV signals, etc, etc.
Apple is such a bully. Obviously, this is so unfair for poor, little, beleaguered Microsoft. How is MS expected to compete with such a huge disadvantage? And the Dell DJ vanishes and no one notices? Michael and Bill will need to hold each other and weep softly on each other’s shoulders while Ballmer videotapes. These are tough times indeed.
Hmm, isn’t iTunes still the only music software/store that is cross platform? Aren’t all of the others still Windows only? If so, that means Apple’s system is more “open” than anyone else’s is. So if they’re going to sue Apple for having a “closed” system, I guess Microsoft and all of the others will be next…
Splitting into a Music Division could cause a problem, as a bunch of old fossils are still in Court, trying to milk Apple over the sale of songs, using Apple as their name.
And anyway, I’m still mad with GM, as I’ve found that the Ford Taurus Oil Filter is $20 cheaper than the Covette Oil Filter & isn’t compatible…
I’m going to sue KFC cuz iCan’t get a $6 Dollor Western Burger or a thin crust pizza.
Courts attempt to punish innovation in music while the true monopoly in computing, the Windows OS, stifles innovation and punishes its users daily. Is this how you foster growth in an economy? Sad.
Just get the judge’s daughter to buy him an iPod and open his eyes.
BTW it is Microsoft who haven’t written their WMA DRM for Macintosh. Maybe some of us would have then ‘tried’ a Dell Pocket Digital Juke box. No, I guess not.
blah blah blah… you posters need to shut up
The key word here is “monopoly”. Anti-trust actions are applicable to all companies that control upwards of 80% of a market. Not to say that the lawsuit has merit – it could very well fail. And even if AAPL were forced to license FairPlay that would not be such a bad thing – it would probably become the de facto standard and AAPL would get a piece of every track sold using that DRM. And consumers will continue buying the iPod as well because it gives you the “Superior Portable Audio Player Experience”.
And it does, doesn’t it?
Doesn’t it?
…
Evil_MS_User
Yes it does. At least as far as getting music on it in the first place.
BTW, what’s your opinion on the lack of Mac WMA DRM? Do you think MS is right in denying it to the fairer platform?
And no, that’s not me just trying to change the subject.
First of all, any competitor can make a store that offers music that will play on an iPod. There isn’t anything stopping them.
http://www.emusic.com. Maybe they dont have the widest selection, but all 600 songs ive got from them go right into iTunes and right onto the iPod.
Consumers can buy any other stuff available on the market and buy music from any others providers, but the majority of consumers prefer iPod and iTunes. Apple didn’t push or use bad business practices to partiners and consumers like M$ do. So the customers are free to choose. If the competitors of the Apple want to get their maket shere, they should try to do a good job and offer better device and music service.
Lets see. iTunes import choices are: AAC, AIFF, Apple Lossless, MP3 and WAV. Buy an iPod, pick your format of choice, rip your own personal CDs and sync to the iPod.
No iTunes store involved.
Let’s see. Buy music at iTunes store, play on your Mac or PC (up to 5) burn audio CDs to play in car or home stereo.
No iPod involved.
Geek choice: Rerip AAC files or audio CDs into MP3 files. Put into any competitor’s software and sync to competitor’s music player.
Wow I’m really tied down with all these choices.
G Spank, I was wondering the same thing. Then I read this story, and now I’m sure.
“With respect to the “tying” allegations, the judge said Slattery was claiming Apple forces people who own iPods to buy music online only from iTunes and also forces iTunes customers to buy iPods to play the music they purchase.”
This is patently false. I wonder if James even knows what the reality is or if he is just going on the claims in the suit.
“Judge Ware rejected Apple’s argument that the tying allegations must fail because people can buy the iPod and iTunes files separately.”
Since Apple’s argument is correct on its face, I wonder what logic James used to reject this.
has anyone noticed the date on the article? It looks like it was out in Sept 2005. Anything more recent happen with this?
Dave H,
My personal opinion is that _no_ private company should have control over something as important as DRM. There should be an open-source standard that can be implemented by everyone.
My favorite analogy to the DRM conundrum is this:
What if the Egyptians had patented paper (and been able to enforce it)?
This is going nowhere.
What, exactly, does Apple have a monopoly on? What does Apple have that keeps people from competing?
Apple isn’t stopping anyone from doingg the following:
1) Developing their own brand of DRM,
2) Signing long contracts with every major label and a boatload of independents,
3) Developing their own multiplatform software suite, and
4) Manufacturing their own player to work within this ecosystem.
Napster could’ve done it, RealNetworks could’ve done it, Microsoft could’ve done it, Sony could’ve done it. The fact is, they didn’t want to do all those things the way Apple did. All Apple did was use their own strengths in the marketplace to develop a business strategy that was VERY hard to copy, becaquse they did it under the radar and gained critical mass in the marketplace before their competitors knew what had hit them.
MDN Word “Possible” as in “Could it be possible that Apple is uber-dominant in the MP3 player/digital music download business because the marketplace chose them over all the other solutions?”
-AP
I own Apple stock – not enough
I use Apple computers since 1984
I own an iPod
I want an open system – The suit migh help this
Remember what a motion to dismiss is: it is filed under a standard by which the argument goes like this: “assuming all facts in the complaint are true, the plaintiff cannot prevail under any legal theory.” This is a difficult standard to meet in any circumstance, let alone one like this one. While some lawsuits virtually beg for what is sometimes called a 12(b)(6) motion, it is typically difficult to sustain such a ruling on appeal, particularly in a complex case like this, where it is not too difficult for a plaintiff to drum up some theory of recovery that the law does not flatly prohibit. Here, I think another large battle will loom over the class certification. Apple has many legal defenses available to it, both substantively and procedurally. But I dop wonder who is truly behind this lawsuit. But the good news is that this “yesterday’s news” is depressing the stock and creating a buy opportunity. It drives the pu$$ies out.
maybe we should all start class actions against all of the game and software companies that do not write compatible applications for apple computers
doesnt this work both ways?
and while we are at it
should we not sue all the websites that arent completely compatible with safari?
this is so high school drama fodder
Evil_MS_User
“What if the Egyptians had patented paper (and been able to enforce it)?”
You could have been able to get it from China. (Just like today)
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Poor argument on the part of Apple’s Legal team. It does play many other formats. Its the licensing of such other formats with its DRM that does not make it profitable. Secondly, they are the brand/one company and that brand/one company is its own software as well. When you buy Apple you are buying the WHOLE package with a certain amount of quality control. Why is it that WalMarts Music files will not work on iPod….BECAUSE of the DRM imposed on it by the music Companies….NOT Walmart. It is NO different than Apple’s DRM imposed by the Music Companies….that is the “deal” , “NO DRM embedded….you cannot sell our music.” The music companies dont care what DRM the companies are using when it comes to selling their music. All they see is $$. They just dont want lame DRM. It is totally out of Apple’s hands…..and there is no such “committee” for such DRM “standard” to agree on so, that every brand portable player and music is compatible.
Stupid Lawsuit!
How can i t be a monopoly – Usually that comes fro someone buying out the competition a-la Microsoft. Apple created the digital music industry and people bought it, You don’t have to buy an iPod no one is forcing you to. If the industry grows with you that can’t be called a monopoly. Is Apple just suppose to help its competitors be “more competitive”?
This suit should be thrown out – you don’t need an iPod to survive.
re: paper – “You could have been able to get it from China. (Just like today)”
Or wasps.
Why isn’t Real in court to defend it’s criminal act of reverse engineering? It’s even quoted as a fact in the court case!
Giofoto,
Yes, Apple was forced into using DRM by the record labels. But don’t think for a second that Apple would drop DRM if the record labels decided not to use DRM anymore. Why? Vendor lock-in. Its the real truth behind DRM, not anti-piracy. Apple has you now. If there is no DRM, you could all of a sudden buy from any music service. Apple doesn’t want that. They want you to HAVE to purchase from iTunes.
Maybe the whole thing that this suit is about is there in no way to get music on the iPod without using iTunes – Is there? Thus the “tied together” argument.
Apple licensing Fairplay (widely) is one thing but it being able to play competing drm schemes is crap. Just cos someone offers some format doesn’t mean you have to accommodate it. Plus, licensing something usually involves a fee, I don’t know about PlayForSure – anyone know on what basis Microsoft license it? Irrespective of any cost, Microsoft don’t even let it run on Mac’s so they don’t even have the option of licensing it.
Re idiot:
yeah, maybe, except iTunes is a free giveaway. It’s hard to base a monopoly complaint by citing a product that is freely distributed to anyone who wants it.
Re: Jeff,
“have to buy from The Itunes store”. Is that why you can put your whole CD collection on your Ipod or any songs you may have gotten from any download service not using some other DRM. Fairplay was a requirement to protect the money not necessarily the artist but at least Apple tried to keep thing legit. I like Itunes it’s easy and just works.
I guess Microsoft will be next on the chopping block for tying PlaysForSure (DRM-WMA) exclusively to Windows, which has already been found to be a monopoly. If this guy wins, you can bet Microsoft will be next in line for a similar lawsuit.
That’s BULL****. Apple work so hard to make technology better for everyone. Apple didn’t crush other competitor. Apple made the software for windows yet hurt Apple’s sale. If Apple didn’t make the software available for windows, windows users would have to buy mac computers in order to use ipod/itunes. …. Apple already gave two options for windows users.
Dell, Creative, HP, MS, Sony and Samsung tried and always try to dethrone Apple but Apple doesn’t mind. Apple believe in competitive not crush competitors.
I disagreed with the judge because Apple never threated competitors like MS did for all years until 2001. OH BULL*****!!!!!
Mel
Let make this a good thing. If apple is being sued for it’s DRM & itunes store, can apple sue all the companys that are not making their software and/or hardware compatible with the macintosh-OSX.
Let make this a good thing. If apple is being sued for it’s DRM & itunes store, can apple sue all the companys that are not making their software and/or hardware compatible with the macintosh-OSX.
Apple wouldn’t have to even do that; it would only take a person with a similar gripe to that of Thomas Slattery to bring about a class action lawsuit against Microsoft for the same allegations, but this time it would be Microsoft tying its DRM-WMA combo to Windows-only. If the case above is somehow successful, then a case against Microsoft should deliver the same results.
For a little reality check about the judge involved look here:
http://www.fa-ir.org/ai/judgeware.htm
He’s currently a member of the 9th Federal Circuit Court of Appeals, the most reversed and off-the-wall bunch of legal dunces in the history of the U.S.
Turbo:
>yeah, maybe, except iTunes is a free giveaway. It’s hard to base a monopoly complaint by citing a product that is freely distributed to anyone who wants it.
Microsoft was sued on the same principal by Netscape because MS was giving Explorer away and has bundled it ever since with it’s os.
I am not defending MS nor AAPL. I’m just pointing that out to you.
Murder Junkie, actually things are different here. Netscape was selling its browser; Microsoft was giving its away. In this case, both iTunes and WMP are freeware. Netscape’s complaint was that Microsoft was abusing its monopoly power to unfairly compete in the browser market; the problem was that, in reality, most copies of Netscape were being given away for free anyway.
There’s really no parallel here.
Re: Egyptians patenting paper.
Johnny F. said:
“You could have been able to get it from China. (Just like today)”
Or, to take your analogy further, all DRM will be hacked just like China counterfeits everything else!
I like it…
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Hurrah ! Welcome in the USA (Useless Sue Association)! I mean you may well be a manufacturer, you may well produce and sell a device, your device may well be tremendously succesfull, this may well happen only because the device is full of qualities and not because of some weird, rotten or malicious maneuver or strategic mass manipulation, then you may well repeate the same exploit with some kind of networked system designed to distribute the very substance of your own device and, again, not only your system may well top everything around because – again – it’s full of qualities, but it may well boost an entire industry, and finaly no, you may not get the satisfaction you deserve, because you just don’t let your competitors (whose devices and systems were far less successful because far poorer in terms of quality) take profit of your creations. As I said: Welcome in the Useless Sue Association !
AHAHAHAHAHAAHHHAAAAHAHAHAHAHAAAA
looks like some attorneys are going to get a schooling.
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