Why Apple Doesn’t Like the French: Bill Passes to Open iTunes
A bill that would open up music-playing technology and tunes to compatible players threatens Apple’s domination in the online market. The French law that would push Apple Computer to make the iTunes playable on devices that compete with the iPod passed through France’s lower house of parliament Tuesday and now moves to its senate.
Apple issued a response statement Wednesday: “The French implementation of the EU Copyright Directive will result in state-sponsored piracy. If this happens, legal music sales will plummet just when legitimate alternatives to piracy are winning over customers. iPod sales will likely increase as users freely load their iPods with ‘interoperable’ music which cannot be adequately protected. Free movies for iPods should not be far behind in what will rapidly become a state-sponsored culture of piracy.”
Under the French law, digital content providers must share details of their rights management technologies with rivals. iTunes, which are protected under Apple’s FairPlay DRM technology, would be downloadable onto alternate devices if the bill passes into law.
DRM technologies are meant to establish the ground rules under which consumers can use the music. They limit the number of copies the user can make (to one or more computers), the number of portable players to which the songs can be copied, and how extensively sharing can occur.
CNET.com reported that Gene Munster, senior analyst for Piper Jaffray, said Apple could choose to withdraw iTunes from the French market rather than change its business. “We believe Apple is more likely to drop out of the French market than open up its FairPlay DRM to allow iTunes to play on competing MP3 players,” he wrote. “While this sounds like a drastic move, we believe it would not materially impact business. We estimate that approximately 20 percent of iPod and iTunes sales occur outside of the U.S. The French market alone is likely less than 2 percent of iPod and iTunes business.” Also according to CNET, an Apple spokesman said he could not comment on what action Apple might take if the measure becomes law in France.
A report from BusinessWeek said that other companies besides Apple will suffer the effects of the law. “Sony and Microsoft could feel the effects of the French law as well. All three use proprietary technology for digital rights management, the protection of content against unlawful copying. In the longer term, though, the French legislation is a warning shot for the music business.”
Not only could the European Commission question Apple’s monopoly, but other countries could also pass similar laws.
BusinessWeek also reported Wednesday that Apple’s stock was down $2.18, more than 3%. “Apple doesn’t break out iTunes or iPod sales by region, but reported a $174 million operating profit on sales of $1.2 billion for its European division in its most recent quarter. It has sold 14 million iPods worldwide.”
On Tuesday, two deputies from the ruling Union pour Movement Populaire (UMP), the party behind the legislation, issued a statement stating they hope other countries in Europe will follow the French example. “These clauses, which we hope will be taken up by other countries, notably at the European level, should prevent the emergence of a monopoly in the supply of online culture.”
BusinessWeek source Francois Laugier, a lawyer with the San Francisco law firm Ropers Majeski Kohn and Bentley said, “Apple’s best allies in any fight against this law may lie with French Socialist and Communist legislators who may oppose the law simply for the purpose of opposing those who favor it.”
“If it passes the Senate,” Laugier said, “there are members of those parties who have suggest that they would like to take the law to the Conseil Constitutionnel, or the constitutional council, the highest legal authority in France on matters relating to constitutional law. I’d start lobbying the politicians who favor bringing it before the council. The provisions of this law that affect Apple are actually very small, and the council might strip them from the bill, or modify them.”
Whatever Apple decides to do with its French connection, it definitely does not favor any provision that would cause its monopoly to crumble.
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They stated that some legal—and agreed-to by the copyright holders—DRM systems, such as the Apple FairPlay technolology, allow you to make copies of your legally acquired digital music.
Again, according to how the RIAA is interpreting the DMCA, you can make a backup copy unless the copyright holder says you can’t. And they are saying that you can’t.
You Americans still have the right to select FairPlay tracks in iTunes and click “Burn to disk”.
In fact, the ability to use Fairplay wasn’t really the issue and I’m not sure how we got off track. The issue is that no other competitors can use Fairplay and are thus locked out of the iPod/iTMS system.
And it begs the question, btw, if DRM is so easily circumvented, and if Apple encourages you to do so to backup your music, why include DRM at all UNLESS the goal is less about piracy protection than it is bullying the competition and consumers?
They are—for the moment—saying that if you can, you can.
DRM systems are just that: systems to digitally manage rights. The rights may vary, according to the DRM system.
And btw, I don’t know why you persist calling it circumvention when it is absolutely not. It is just plain exercise of the rights granted to us users.
And btw, I don’t know why you persist calling it circumvention when it is absolutely not.
That’s semantics. The point is that you are removing Apple’s DRM. It’s easy to do technically and then play your music on other devices or rip it to a new device.
And you’re rather conspicuously avoiding my main question:
Why would Apple make the argument that forcing them to share DRM would lead to piracy when they KNOW it’s not true? Why would they refuse to license their DRM when it’s so easy for the consumer to remove it anyway?
There is only one answer to this question and it paints an ugly picture of Apple.
You are wrong on so many levels…
Um…care to elaborate? Is any Apple-drone apologist actually capable of making any kind of argument about anything at all?
You yourself claim that Apple’s DRM is easy to remove. Just burn a CD then play it on anything you want. It’s then a relatively simple matter of ripping it to another player or sharing it online.
Fairplay does NOTHING to prevent piracy. Nothing whatsoever. And forcing them to license it would not even remotely enable piracy. In fact, one could argue that it would reduce it.
So when Apple claims that forcing them to share Fairplay would result in state-sponsored piracy, they are LYING, and they know they are LYING.
Piracy has gone down because of the ease of use and relative low cost of songs on iTMS. What WOULD cause more piracy is Apple pulling out of the French market altogether, which is what Apple is most likely to do.
So again, why would Apple fight to hard to keep from having to licence Fairplay? And why use DRM at all if it’s so easy to defeat?
The answer to the second question is easy. They are forced to include DRM in order to make deals with the record labels. But if including DRM is a simple matter of capitulation to the labels, why the refusal to license it? If Apple is a reluctant participant in DRM and only does so to satisfy the RIAA so that Apple can bring music listening pleasure to millions of fans, why not share Fairplay and let others do the same? It doens’t prevent piracy and doesn’t actually protect the music.
The reason why is because Apple knows that the other online stores have to have DRM too. Like Apple, they can’t make deals with the labels unless they protect them. And if they can’t use Fairplay, they have to come up with their own incompatible system. Most of them use Microsoft’s PFS DRM. And while MS might be a big player in the OS market, it has neither a player or a store to compete with Apple.
The bottom line is that Apple has a monopoly on the market and likes it that way. As Oskar points out, they will use whatever means necessary, including their market share, to keep other companies from competing. It’s not about quality. It’s not about being the best. It’s about getting to the top and staying there, even if you have to lie, cheat, and bully.
Looks like Denmark might be looking to do the same thing as France. It’s too bad these changes are being initiated by other businesses and not the politicians who are supposed to be looking out for consumers. In that sense, Oskar is right.
http://arstechnica.com/news.ars/post/20060326-6463.html
— Beeblebrox (insisting on calling circumvention what is not): “That’s semantics.”
It’s not semantics—i think you know it’s just dialectics.
— Beeblebrox: “The point is that you are removing Apple’s DRM.”
FairPlay files remain unchanged. The ability to make a limited number of copies of them, in an open audio format, and for non-copyright-infringing personal use, is absolutely compliant with the terms of Apple’s DRM, which have been agreed to by the copyright holders—and you may think these people are not stupid when it comes to protecting their own interest.
— Beeblebrox: “It’s easy to do technically and then play your music on other devices or rip it to a new device.”
Yes, it’s actually easy to do. And—as of now, anyway—it is legitimate, too.
— Beeblebrox: “And you’re rather conspicuously avoiding my main question. Why would Apple make the argument that forcing them to share DRM would lead to piracy when they KNOW it’s not true?”
I’m not an Apple spokesman. And i don’t think the people at Apple know anything very accurate about what the future will actually be. They are as clueless as you and i are, for that matter.
— Beeblebrox: “Why would they refuse to license their DRM ...?”
Why would they heartily accept to do so at once? You know, sometimes it almost seems like Apple is a for-profit organization—how shocking!—trying to promote their own products and their own views about business. But in the end, should a law uncomplacent to Apple be passed—and enforced—on the subject of interoperability, either they’ll comply, or they’ll take their marbles and go.
— Beeblebrox: ”... when it’s so easy for the consumer to remove it anyway?”
Yes, it’s easy, and legitimate for personal use. Don’t fear to do it. It’s not like you didn’t pay for the songs.
— Beeblebrox: “There is only one answer to this question and it paints an ugly picture of Apple.”
Hehe. It is always been hard to elaborate about conceptual art…
— Beeblebrox: “Um…care to elaborate? Is any Apple-drone apologist actually capable of making any kind of argument about anything at all?”
You talkin’ to me?... You talkin’ to me!?!
— Beeblebrox: “You yourself claim that Apple’s DRM is easy to remove.”
Well, yes, it’s not like i’d have to circumvent something, you know.
— Beeblebrox: “Just burn a CD then play it on anything you want.”
I’m glad that you eventually got to know something about the iTMS and FairPlay.
— Beeblebrox: “It’s then a relatively simple matter of ripping it to another player ...”
I guess it could be considered a convenient—and already existent—mean of interoperability.
— Beeblebrox: ”... or sharing it online.”
As for that, don’t!!! You’d go to freakin’ jail!
— Beeblebrox: “Fairplay does NOTHING to prevent piracy. Nothing whatsoever.”
I agree that’s kind of sad. That may be the reason why the record labels did not sign a distribution contract with Apple, did they? And more than a billion songs never were purchased online at the iTMS. Or were they?
— Beeblebrox: “And forcing them to license it would not even remotely enable piracy. In fact, one could argue that it would reduce it.”
Time will tell. In a true democracy, anyone is always able to argue anything. No one even has to actually know something about it.
— Beeblebrox: “So when Apple claims that forcing them to share Fairplay would result in state-sponsored piracy, they are LYING, and they know they are LYING.”
Apple is being bad, bad, BAD!
— Beeblebrox: “Piracy has gone down because of the ease of use and relative low cost of songs on iTMS.”
To that i’ll respond NOTHING. Nothing whatsoever.
— Beeblebrox: “What WOULD cause more piracy is Apple pulling out of the French market altogether, which is what Apple is most likely to do.”
Beeblebrox knows, because he’s been there before—the croissants were nice.
— Beeblebrox: “So again, why would Apple fight to hard to keep from having to licence Fairplay?”
Confined in obscurity, one is reduced to make the darkest conjectures.
— Beeblebrox: “And why use DRM at all if it’s so easy to defeat? The answer to the second question is easy. They are forced to include DRM in order to make deals with the record labels. But if including DRM is a simple matter of capitulation to the labels, why the refusal to license it? If Apple is a reluctant participant in DRM and only does so to satisfy the RIAA so that Apple can bring music listening pleasure to millions of fans, why not share Fairplay and let others do the same?”
Why eat your cake instead of giving it away?! I’ll tell you why… wait, you already know why. I can recognize a human being when i see one.
— Beeblebrox: “It doens’t prevent piracy and doesn’t actually protect the music.”
At least it doesn’t protect people from buying music and listening to it. By the way, have you tried that “burn to disc” feature that comes with FairPlay’s DRM? Sure, you’d better not use it to share your music on P2P networks, as you’d go into big trouble, but if you only wanted to be able to listen to the songs you’ve bought, on a device of yours, it certainly is a kind and sensible attention.
— Beeblebrox: “The reason why is because Apple knows that the other online stores have to have DRM too. Like Apple, they can’t make deals with the labels unless they protect them. And if they can’t use Fairplay, they have to come up with their own incompatible system. Most of them use Microsoft’s PFS DRM. And while MS might be a big player in the OS market, it has neither a player or a store to compete with Apple.”
That’s a shame. Let’s hope they’ll come up with something better next time.
— Beeblebrox: “The bottom line is that Apple has a monopoly on the market and likes it that way.”
This is amazing, indeed.
— Beeblebrox: “As Oskar points out, they will use whatever means necessary, including their market share, to keep other companies from competing.”
What’s funny is that, so far, it hasn’t prevented other companies to keep trying to “compete”, but with rows after rows of ever inferior products, services, and DRM terms. Talk about a seamless experience in mediocrity…
— Beeblebrox: “It’s not about quality. It’s not about being the best.”
In the end, i myself wonder what all this fuss is about…
— Beeblebrox: “It’s about getting to the top and staying there, even if you have to lie, cheat, and bully.”
Wait, up until now, to achieve supreme dominance, realize that Apple only had to lie—er, i mean, use marketing speech—, and has not yet resorted to the nastier behaviors you mention… It tells a lot about the quality (or lack thereof) of their competitors. Why should such a bunch of corporate losers have to be governmentally protected from the unbuying wrath of the market? Besides, what are they poor souls sobbing about? Can’t they manage to be alive and well with a mere 5% marketshare? It’s certainly feasible: look at Apple in the computer industry.
If you are concerned about DRM lock-in, and it is an understandable concern, buy DRM-free music (AIFF, WAVE, MP3, or unprotected AAC—iTunes and the iPod can play them too, by the way).
If you are not so concerned about the DRM issue, but you prefer to buy your DRM-laden music from an online store other thant the iTMS, you are free to do so—in many cases, you’ll have to use a computer running Windows, though—which, arguably, is not a real problem for the computing majority.
If you want to use a portable music player other than an iPod, you are free to do so—but beware you’ll seem kind of strange to most people in the streets.
If you want to play your iTMS tunes on one of these alternative PMPs (yes, you can still find some of them in some places, if you look carefully), well, do you remember that legitimate procedure in iTunes involving a “burn to disc” button?...
If you want to build a business comparable in power to that of Apple: first, make a good-looking player, with a good interface, that supports a lot of audio formats; then make a good-looking store, with a good interface, and get the support and agreement of a majority of record labels, to sell a wide variety of tunes, protected with sensible DRM, at a sensible price; above all, be sure to make the process a seamless and enjoyable experience; then advertize a bit about the whole thing, and you’re set to success.
It’s easy. It’s not like it’s never been done before.
Yes and highly entertaining.
On the other hand what would be GREAT would be for the law to require ALL online music stores to adopt a standardised DRM that let any music be played on any brand of player.
I for one am not surprised to see the company with the most short term interest vested in making competition more difficult, if not impossible, is not spearheading this effort.
Of course what you Lionel suggest in your last paragraph is essentially that the situation where a company is effectively BARRED from simply making a DAP, UNLESS it secures its own content, is OK.
I have to agree with beeblebrox that this is not OK. It’s also unprecedented. Imagine every CD player manufacturer having to secure separate distribution models from every content company, and a system where CDs for Sony players wouldn’t play on Bose players, which in turn wouldn’t play on Phillips players.
That clearly wouldn’t be acceptable, and I suspect the only reason we think it would be acceptable for digital music is because of Apple’s headstart: the DAP ecosystem just isn’t like the CD player ecosystem, because it’s almost entirely ipods.
I’m afraid for these reasons however much I would like to I just can’t agree with you if you think DRM should lock music into individual brands of the DAP form factor.
I apologise if this is putting words into your mouth.
What would be great is to get rid of those DRM systems altogether. But i fear that, for some reasons, it won’t happen.
What we may hope is that we’ll be allowed to chose the DRM system that’s the least detrimental to the authors and copyright holders as well as to the users. I personnally think that, for the time being, FairPlay is the most sensible DRM system out there. Your mileage may vary. But not that much.
I’m afraid that demanding that all DRM systems be compatible with one another will lead to enforce the “lowest proprietary denominator”... and a better DRM system (i.e. which give users more respect and more flexibility) will be prevented to emerge until a new law is passed, or until all the DRM vendors agree to interoperate with the newcomer.
(Besides, FairPlay already permits compatibility, since its terms allow you to burn your iTMS tracks on an audio-CD, so you can play your music on your device of choice. So this French bill about compatibility was not absolutely necessary, in my opinion.)
Moreover, i fear that once the existing DRM systems will be compatible, the DRM exception will become the rule—“What? You want DRM-free audio, you say? But why would you want that, since all systems are now compatible? Unless you’re a pirate?”... You see what i mean.
But consumers don’t like their DRM too tight… And once the DRM lock-in will be standardized, people might try to avoid it, resorting to either P2P networks or those “gray market” stores, such as allofmp3. This risk is, emphatically, dubbed “state-sponsored piracy” by some Apple spokesperson…
As for competition, well… It would be nice to have some, indeed. But competition demands more than a new law—it would take some smart competitors, for a change, and not the dumbasses we see crying in agony now.
As i said, if they wanted a bigger slice of the pie, why didn’t they think of making a deal with the record labels? Why didn’t they think of making some nifty music players, that people want to use—and to show? Why didn’t they think of building a nice store from which people actually want to buy stuff? Why didn’t they think of using sensible DRM terms? Why didn’t they think of using a worthy audio format? And shortly after they began to realize the power of Apple’s offering, why didn’t they try again, better? Why didn’t they stand up and fight?
Actually, these whiners came into that business because they thought there would be no real competition. It had to be an easy ride: they used the Microsoft solutions, they could count on the huge Windows user-base, and the only opposition they were facing was that tiny-market-share snobbish over-priced-computer maker from California that everybody laughed at… Well, tough luck.
When all is said and done, either Apple will comply with the new law, and they’ll still completely dominate both the online-store and PMP markets, no matter how “compatible” they will be—or they’ll leave… The situation would then reverse back to normality: crap for everyone—just kidding…