Earlier this year, Apple finally agreed to strong pressure from the major record labels to introduce variable pricing on iTunes -- which officially would make some popular songs $1.29 and (in theory) also offer older, back catalog songs for $0.69. In reality, it's pretty difficult to find any of those $0.69 songs. However, as a musician, which would you prefer? Well, as Shocklee alerts us, most musicians might not see any of that additional fee (that report is a little misleading, though, in that it suggests -- incorrectly -- that all songs were driven up to $1.29). I have to admit that I'm a bit surprised by this, and wonder if it's really accurate. The telling quote in the article is this one:
"Artists receive fixed residuals for music sales based on individual contracts via their respective record companies," says Max Clingerman, a music executive for MixJam Records who explains "the staggering price increases are not for the artist interest, rather intended for executive pockets."
While I'm sure the intention was very much for exec pockets, I was under the impression that most major label contracts included royalty rates based on retail price. And while most signed musicians never recoup their advance, and thus never see any royalties whatsoever (no matter what the price), I do wonder if it's really true that musicians don't get a larger cut of higher priced digital sales (at least in the fictional accounting systems the labels use).
Of course, the larger point made by the article is almost certainly true. In increasing the price to $1.29, the demand for such songs has been driven down significantly, leading people to look for alternative sources for the same music.
We've mentioned in the past how silly it is that Apple blocks the Palm Pre and other devices from accessing iTunes. Plenty of people responded, pointing out that Apple really makes its money on the hardware, and thus it makes no sense to allow other hardware products to connect to iTunes. While I agree that Apple makes its money off the hardware, I still disagree that Apple should block others out. In doing so, it makes me and many others less likely to purchase an Apple product, because I don't want to get trapped into Apple hardware. I'd much rather a more open solution.
I hope the company continues to search for ways to sync with iTunes, because the fight--silly as it seems--is important, and Palm is clearly in the right. Apple may have the USB-IF on its side, and it may also be protected by copyright law. But by blocking non-Apple devices from its music app, Apple is violating a more fundamental principle of computing--that unalike devices should be able to connect to one another freely. The principle underlies everything we take for granted in tech today: It's why the Internet, your home network, and the PC function at all. And it's why Palm should keep storming the iTunes fortress.
I am not claiming that Palm has the legal right to hack into Apple's software, nor am I calling on any authorities to compel Apple to let Palm in; if the cat-and-mouse game turns into a courtroom brawl, it's very likely that Apple would win the fight. Instead, I'm calling on Apple to stand down. Even better: It should create a legal pathway for Palm and every other company to sync with iTunes. Why? The most obvious reason is that it's good for iTunes users. Nobody other than Apple benefits from locked-down software. Apple frequently extols the wonders of digital music--the convenience, the flexibility, the environmental friendliness. But how flexible can it be if you're allowed to sync your tunes only with devices made by a single company?
What's more, the iTunes block is hypocritical. Like every other tech company, Apple has benefited enormously from the spirit of interconnectedness that pervades the tech industry. The iPod would have fizzled if Microsoft had blocked it from hooking up to Windows PCs. Or look at the iPhone--Apple is proud that it can sync with Outlook, Microsoft Exchange, Gmail, Yahoo, and just about everything else. Indeed, you could argue that Apple, once left for dead on the periphery of the tech industry, managed to come back only because it skillfully marketed Macs as the most promiscuous computers you could buy.
Indeed. While it's unlikely that Apple will actually do this, it would be a smart move. No one's buying Apple hardware because it syncs with iTunes. They're buying it for many other reasons, and Apple can continue to compete on those. Blocking the Pre and other devices from accessing iTunes is petty and unnecessary.
Back in 2007, we noted that Eminem's publisher was suing Apple for offering Eminem tracks on iTunes. Apple pointed out that it had an agreement with Eminem's record label, and we wondered why Eminem wasn't suing Universal Music, rather than Apple. So, earlier this year, when Eminem and Universal Music went to court we assumed that the lawsuit had been refocused on the proper party. Apparently, we were wrong. The lawsuit against Apple is scheduled to begin Thursday if no agreement is reached today. However, remember that lawsuit against Universal earlier this year? Well, Universal won, with the court saying that Universal had the right to distribute digital offerings. So... why is the lawsuit against Apple still going forward? Am I missing something...?
There have been a number of lawsuits over the past few years from artists who are complaining about how the major record labels account for iTunes sales. The question is whether or not a song sold on iTunes is the same as a CD sale (a tiny tiny royalty) or more like licensing a song for a commercial (more like a 50% royalty). Obviously, the record labels want iTunes treated like a CD. But musicians have a reasonable argument that an iTunes sale may be a lot more like a typical license, as a big part of the reason in the discrepancy in the royalty rates is that there's no (expensive) physical packaging and distribution to handle. The Allman Brothers were one of the first to file lawsuits on this issue suing both Sony Music, and then a couple years later, Universal Music Group (I'm still not clear why they sued the two separately, years apart). Eminem also had sued UMG over this issue and lost, as a jury said iTunes was more like a CD sale.
UMG tried to get the case from the Allmans dismissed, but davebarnes alerts us to the news that the court has refused to dismiss the case, and it will proceed to a full trial. Of course, like Eminem, the Allmans may lose the trial, but it's better than having the case dismissed outright. Of course, if the Allmans win, it will create a bunch of similar lawsuits in short order, as pretty much every artist will be demanding a lot more iTunes revenue.
Just before the whole mess -- including an FCC inquiry -- of why Apple rejected Google voice on the iPhone, we were among those who wondered if Apple would approve Spotify, the well-hyped (perhaps over-hyped) music app that in many ways competes directly with iTunes. Well, it looks like Apple has approved the software, though Spotify is still only available in certain European countries (though there are promises of a North American launch later this year). You really have to wonder, though, how much of the approval was due to the mess and attention that Apple received following the rejection of Google Voice. It seems likely that the company is now (finally) a bit more sensitive to this issue, and may have decided that it didn't need another PR headache... or to give any more fodder to the FCC. Spotify probably owes Google a nice bouquet of flowers.
Having used Spotify a bit, I can definitely see how some people think it could potentially replace iTunes completely. It basically acts like an iTunes that has access to millions of songs at no additional cost (and, yes, it's all licensed and legal). The songs are streamed, but you almost never notice it. It really does feel just like iTunes, while also having "Pandora-like" features for creating specialized stations or sharing others' playlists. Unfortunately, it's only available in the UK for now, though the rumor is it will be available in the US before the end of the year. However, where things could get really impressive is with Spotify's mobile app. For a few months, there's been a YouTube video of Spotify Mobile on Android:
The demo highlights the fact that you can sync any playlist for "offline" play, solving the biggest question about weak mobile signals on the go, or how you use it on a plane or somewhere without wireless access. With offline syncing, it's basically everything that an iPod can do -- with access to 6 million songs without having to pay for each individual song. But, of course, Android is still a limited platform. The big fish these days is the iPhone App Store, and Spotify has now submitted an iPhone app for approval, which raises all sorts of questions. With Apple's history of rather arbitrary rejections -- including ones for things Apple has deemed "competitive" -- will it block Spotify as a rather direct competitor to iTunes? That would be very unfortunate, and again demonstrate the risk of a closed platform.
That said, the initial reviews of the iPhone app seem quite strong. Eliot Van Buskirk at Wired loves the syncing feature, and warns that "you'd have to pry it out of my cold, dead iPhone before I'll delete it from my phone." Meanwhile Music Ally points out that Spotify has uploaded a video of the iPhone app as well:
It really does look pretty slick. So now the ball's in Apple's court. I have no idea if Spotify can survive as a business (and I suspect that the royalty rates the music industry wants will make that difficult), but it is great to see more innovation in the space. Now we get to see how Apple feels about that sort of innovation.
Last November, the EFF took Apple to task for threatening the owner of a wiki site. Apple claimed that an ongoing discussion on the site about how to build interoperability between iPods and iPhones and alternative software other than iTunes violated the DMCA -- which requires quite a novel interpretation of the DMCA. After Apple refused to back down, EFF sued in April. Somewhere along the way, it looks like Apple's lawyers started to realize that it had pretty close to no chance whatsoever and has now withdrawn this particular threat. The EFF is dropping the lawsuit, but isn't pleased that the whole thing had to happen in the first place:
"While we are glad that Apple retracted its baseless legal threats, we are disappointed that it only came after 7 months of censorship and a lawsuit," said EFF Senior Staff Attorney Fred von Lohmann. "Because Apple continues to use technical measures to lock iPod Touch and iPhone owners into -- and Palm Pre owners out of -- using Apple's iTunes software, I wouldn't be surprised if there are more discussions among frustrated customers about reverse engineering Apple products. We hope Apple has learned its lesson here and will give those online discussions a wide berth in the future."
Indeed. While the Palm Pre situation is in the other direction (interop between alternative hardware and iTunes software, rather than alternative software with Apple hardware), it shows again that Apple will do whatever possible to stop people from making legal use of products they purchased.
The pettiness of Apple continues... Last month, Apple warned potential buyers of the Palm Pre that it might break that phone's ability to sync with iTunes. It didn't take long for Apple to follow through. In an upgrade to iTunes, which Apple claims was for "bug fix" but also to handle "verification" issues, it has blocked the Palm Pre from accessing iTunes. This is pure petty behavior on the part of Apple. When the original statement was made, some assumed that Apple was really just saying that it couldn't be responsible if an update broke the syncing, not that it would purposely break that ability. But Apple's comments suggest they cut off the Pre on purpose, noting that it wanted to stop devices that "falsely pretend" to be iPods or iPhones.
The Palm Pre is a nice phone according to many people, but it's not making any serious dent in iPhone sales. Blocking it out of iTunes is just silly. I don't have a Palm Pre or an iPhone... but I do use iTunes. But now that I know Apple is breaking software and removing features, I guess it's time to look elsewhere. How's Songbird these days? Other suggestions?
from the do-they-want-to-get-paid-in-gift-cards? dept
As we all know, back in April, Apple changed its iTunes pricing policy so that not all songs are $0.99. Now, some are $1.29 (and somewhere, we're told, there are a few that are $0.69). However, Apple has now been sued by a couple who claims iTunes gift cards are misleading, because they were sold claiming that iTunes songs are $0.99. The lawsuit claims that this is fraud on Apple's part, but I have a pretty difficult time believing this case gets very far.
I have to admit that I've never really understood Apple's ongoing efforts to block any sort of compatibility with both iPod devices and iTunes. You may recall a few years back the big fight between Apple and RealNetworks when Real tried to let its software connect to iPods, which Apple treated as a gross injustice. Now Palm is doing the opposite, by letting the Pre connect and sync with iTunes software by making the device pretend it's an iPod when connected to a computer. Apple, however, has responded with a neat little message that never actually mentions Palm, even if it's entirely transparent who it's about, warning people that Apple can easily break syncing when it updates its software. Of course, Apple did it in a way that it can claim wasn't meant nefariously at all. All the company really meant was to make people understand that it has no control over how the Pre syncs with iTunes, and it's possible that an update could break that syncing. Sure. Right. Except most people assume this means Apple intends to break it.
But I don't understand why. For people who bought the Palm Pre, that's only going to piss them off and drive them to use other software, taking them away from Apple's products. Why does that help Apple? Having Palm Pre syncing with iTunes increases the value of iTunes. What's wrong with that, other than being the latest example of Apple's dislike of anyone doing anything not invented in Cupertino?