Thursday, March 20, 2008

eMusic: Apple's Bundled-Music Device Would Be Illegal and Anticompetitive

Apple is in for a fierce legal fight should it ever release a device that offers all-you-can-eat music, according to David Pakman, CEO of rival digital music service eMusic. It smells like classic Sherman Antitrust Act to me," Pakman said. "I only know what I've read but the plan sounds very similar to the tying practices Microsoft used with Windows/Explorer. And Microsoft is still paying the penalties for that one." The Financial Times reported Tuesday that Apple is in talks with the four largest record labels about offering a device with access to the entire iTunes music library. A source close to the negotiations confirmed the report in an interview with CNET News.com and said the offering would be free initially but device owners would later be charged subscription fees. Apple is forcing people who buy this device with preloaded music to buy its music, Pakman argues. An Apple spokeswoman said the company doesn't comment on rumor or speculation. Critics say that Apple, which sells 70 percent of all digital music devices, could use its overwhelming market share to wall out competitors. No other music services--download or subscription--could sell songs to such a device. Music listeners wouldn't need to get their music anywhere else. Competition among digital music retailers would suffer, said Pakman.
http://www.news.com/8301-10784_3-9898282-7.html?tag=nefd.top

No comments: