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January 29, 2007

Norway Tells Apple to Open up Fair Play or Wind Up In Court

Norway has joined the DRM fray by voicing opposition to the closed Apple-iTunes-iPod system.  The Norwegian Consumer Ombudsman says the closed system violates Norwegian law and will sue Apple if the system does not allow music from any store to play on the iPod, and Apple branded songs to play on other portables.  Apple issued the usual bland statement that it seeks to resolve the issue quickly.  This may be a situation where the problem may not be resolved so easily.

Look at it from Apple's point of view.  An open system does them no good as it will dilute sales from the iTunes Store and force them to compete against other music providers for space on the iPod.  iTune sales to other MP3 players may not even that loss out.  Apple, therefore, will do anything it can to maintain the status quo. 

Norway, on the other hand, may be relying on quaint consumer concepts that music should be playable on all portables.  They must have gotten that idea from CDs, which manufactured anywhere in the world are playable on players from any number of manufacturers anywhere in the world.  Even, gasp, vinyl had those same characteristics.

The labels who provide the music must be feeling a little queasy over this.  They have little to no leverage against Apple as it owns most of the distribution market.  If Apple leaves Norway, which is a possible outcome, the labels may lose the market there.  Norwegians left to their own devices may turn to the only other viable outlet for downloadable music:  the file sharing networks.  Nobody wins commercially with that result. 

Other European jurisdictions are also making noise about Apple to open up.  Microsoft is probably watching this closely as it will introduce its closed system Zune player to Europe later on this year.  Microsoft will surely have to play by the same rules forced on Apple, if it comes to that.  This all or nothing scenario depends on how far Norway wants to take this. 

Stories are in the Commerce Times, Monsters and Critics, and MSN Money.

January 29, 2007 | Permalink


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