“Apple’s reported plan to bundle unlimited iTunes music store access with iPods could bring antitrust allegations similar to those faced by Microsoft for its bundling of Internet Explorer with Windows, according to David Pakman, CEO of iTunes competitor eMusic,” Eliot Van Buskirk blogs for Wired.
“‘They’re basically saying, ‘Let’s give a piece of every iPod sale to the record labels in exchange for bundling in all the music you can eat with every iPod” said Pakman,” Van Buskirk reports. “‘That’s classic Sherman Antitrust Act behavior. It’s called tying, and it’s where a company with a monopoly position in one market uses that monopoly position unfairly to compete in another.'”
“Pakman says Apple’s possible bundling of iTunes with the iPod represents the same type of behavior that brought the Justice Department down on Microsoft. The company’s bundling of Internet Explorer with Windows ‘killed the browser market, it killed Netscape. And (Microsoft) ran into all sorts of trouble in the U.S. and in Europe,’ Pakman said,” Van Buskirk reports.
“EMusic, which has 15 percent of the digital music market, would play the Netscape role in this scenario — as would Amazon.com, RealNetworks, Napster, Best Buy, Target, Circuit City, Wal-Mart and other music retailers, which could react by bringing an antitrust case against Apple,” Van Buskirk reports.
More in the full article here.
We can hear the sweat dripping off his brow.
Worry much, Mr. Pakman?
Is it a ‘Plan” yet?
Which came first, the game or Pakman?
I smell a smokescreen to distract the other music retailers from what’s really coming.
Scared is good! But you must abuse the monopoly to get in trouble, not merely be a monopoly.
I will wait until an actual lawyer rather than someone with a vested commercial interest in an outcome weighs in….
“eMusic CEO: Apple would be breaking antitrust laws with reported ‘all-you-can-eat’ iTunes plan”
Translation: I just crapped in my pants and my resume is not up-to-date.
I think Mr. Pakman needs to change his Depends.
Why would this plan trigger an anti-trust investigation?
Unlike Microsoft’s historically catalogued tactics, Apple with iTunes and the iPod have NOT gone out of their way, NOT made it their corporate policy to harm other companies or their products. Apple simply designs, produces, advertises and sells an extremely popular product.
NO ONE is forced to buy iPods.
If you buy an iPod you are not FORCED to use the iTunes Store. I don’t, except for downloading a few free podcasts.
So, why would it be monopolistic for Apple to offer MORE choice to their customers?
HAHAHAHAHAHAHAHA
Idiot.
He is so wrong about antitrust laws and comparing it to Microsoft’s issues with Internet Explorer.
I don’t know if this guy has a point or not, but I do know that eMusic sucks. I got one of those 25 free download cards, signed up, and couldn’t find ANY songs I liked. So I cancelled it out. Then I noticed they had charged me 9.99 on each of my next two credit card statements for something I had apparently clicked on while at their website. So I called to tell them to credit it back to my card. Only when I called the customer service number I found on their website, I got an answering machine that was very obviously just somebody’s residence. Multiple calls gave me the same guy’s answering machine. I finally had to call my credit card company and let them straighten it out. No wonder iTunes is so dominant….
Yeah right, like you’re a fscking saint, Mr Pay-musicians-a-whopping-12-cents-per-track-Pakman!
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That would only be true if apple used a DRM encrusted file format for said music. If Apple was using an open AAC format like they do have now then anyone who could play AAC’s wold be able to get in on that deal.
Actually eMusic is one of the good services out there. Independent labels. No DRM.
Still I think he’s full of crap.
Besides, who EATS their music. I mean, I don’t listen to a bannana.
“I got an answering machine that was very obviously just somebody’s residence. Multiple calls gave me the same guy’s answering machine.”
Perhaps David Pakman was upstairs eating dinner with his mom? His pr0n torrents were going to take awhile to download.
“The company’s bundling of Internet Explorer with Windows ‘killed the browser market, it killed Netscape. And (Microsoft) ran into all sorts of trouble in the U.S. and in Europe,”
And now, years later, IE is still on top, Microsoft is relatively unaffected by anti-trust lawsuits, still making a pile of money, and not much else has changed. So the lesson for the shrewd businessman is: Why not?!
What an idiot this guy is. His company is ok but he does not have a clue about this. This is so NOT like the Internet Explorer issue. That was a browser dongled to NOT let other people play. iTunes plays music from emusic just fine so he should concentrate on selling more and paying more to the musicians.
I think we need to keep a moment’s silence here. This is a monumental achievement, especially for those who have suffered the blows of malcontent for the past 20 years.
Apple has been threatened with anti-trust and monopolistic practices! Ahhhh, the air somehow smells sweeter.
Mr. Pakman,
Please watch out particularly for that damn Red Ghost. He’s much smarter, faster and more nimble than those other Ghosts.
There’s an analogy in there somewhere… hmmmm….
good one C1-why not indeed.
Apple’s been using anti-competitive tactics since the launch of the iTunes Music Store, and planning them since the launch of the iPod. Tying the iPod to a single online distribution channel is what put most of the others out of business. It’s only the other companies (eMusic for example) that finally broke down the music companies and managed to distribute DRM-free tracks that broke Apple’s complete shutout in that market. Of course, after that deal had been made, Apple tried to position themselves to look like it had been their idea all along, and the fact that they were doing the OPPOSITE of that for five years and crushing everyone else in the process didn’t mean they were happy about it.
Of course, after years of anti-competitive behavior, Apple’s still the big dog as a result. Just like MS benefitted from their baloney.
That said, I don’t know if this alleged all-you-can-eat model would constitute anti-competitive behavior, unless they’re forcing the arrangement on the music labels as a condition of participation in the iTunes Store.
No, PC, the fact that others made players that sucked and tied theirs to sucky music distribution channels, such as M$’s cheap crap and Playsforsure is what killed the others. The fact that their players were tied to DRM that often kept them from even ripping users’ music also sucked.
The iPod allowed anybody to play anything that didn’t use DRM or wmv crap plus allowed users to rip their own music into the iPod is what made it a success.
The iPod was a success long before the iTunes store came along.
That said, I don’t see Apple giving anybody a part of their revenue – that’s just not Apple’s way. Now if they could figure out a way to move the money in the OTHER direction and still make those libraries of music available…
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I was on eMusic when it was all you can it. It had better music even then than iTunes does now, largely. If you’re a real music fan, eMusic used to be a very good place.
He’s wrong about antitrust, as is nearly everyone who hasn’t been to law school who opens his mouth about it. It’s not illegal to be a monopoly. It’s not illegal to want to or try to be a monopoly. If you are a monopoly, it’s not illegal to reap the benefits of your position. “Tying” or bundling is definitely not illegal if done for rational reasons.
What you’re not allowed to do is abuse your position. Apple would not be allowed to use its dominance to, say, forbid the labels from cutting deals with anyone else. But they’re allowed to get the best deal for themselves that they can.
Well,
IE and Win are both owned by M$,
Apple doesn’t own music, so what’s the problem?
Wait, so what about auto industry? They are selling cars that use gasoline and I wanted to fill it up with water.
Funny thing is that this doesn’t directly effect emusic–the major labels that have been pushing for a subscription model don’t allow emusic to sell their tracks–emusic’s pricing is too low.
If the majors had sold their music as uprotected mp3s in the first place (and emusic predates iTMS) then Apple wouldn’t have had to get Fairplay or open the store at all.
I suppose Pakman has two fears:
1) He’s getting sicky of selling independent music for cents a track, thinks he is finally within sniffing distance of getting the majors signed, and this kills that for him (as well as his chance to unload emusic at a profit.)
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2) People will be so drowning in gulp-as-you-want music from the majors through iTMS that customers won’t bother with emusic. This seems like a pretty dumb fear–if people want the indie music he’s selling, they’ll buy it.
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3) He’s afraid his independent lables (or at least the larger of his independent labels) will then toss in with Apple for a sliver of iPod cash, leaving him with just smallest independents.