Print 48 comment(s) - last by macthemechanic.. on Mar 26 at 11:17 AM

RealNetworks raises serious questions about Apple's tactics with iTunes

An order issued earlier this week by a federal magistrate judge will require Apple CEO Steve Jobs to answer questions regarding an iTunes antitrust suit.

ITunes, Apple's proprietary digital media player application, was launched in 2003. It became wildly successful, even beating Wal-Mart as the biggest music retailer in April 2008. 

But according to RealNetworks, a Seattle-based provider of Internet media software and services, iTunes allegedly utilized unfair practices in the digital media industry between October 2004 and March 2009. In july 2004, RealNetworks announced that its online store offered music that could be used on iPods through a technology called Harmony. Five days later, Apple released updates to its iPod FairPlay software, which is a proprietary software used by Apple to encode its digital music files. The iPod FairPlay software allowed iTunes music files to be used only on iPods, and blocked digital music sold by other companies to be played on the iPod. This included RealNetworks' digital files.

In 2005, Thomas Slattery, an iTunes customer, filed a lawsuit on behalf of customers who believe Apple "illegally limited consumer choice" by making iTunes exclusively for iPod and vice versa. He asserted antitrust claims from Apple's use of the FairPlay software. 

In 2008, Apple faced the same issues with consumers in Europe who complained about the lack of compatibility with iTunes and the iPod. The European Union Competition Commission started an inquiry in 2005, where regulators from Norway, Denmark and Sweden examined the situation. As a result, Apple lowered the prices of iTunes tracks in the United Kingdom. 

In March 2009, iTunes began selling digital music without the proprietary software, and in May 2010, the U.S. Justice Department's antitrust division began looking into Apple's business practices associated with iTunes and the iPod. 

Now, U.S. Magistrate Judge Howard R. Lloyd in San Jose, California has issued an order that allows lawyers for consumers to question Jobs. The deposition can only consist of questions regarding Apple's software changes made in October 2004, which prevented digital tracks from RealNetworks from being played on the iPod. In addition, the deposition can only be two hours long.

"The court finds that Jobs has unique, non-repetitive, firsthand knowledge about the issues at the center of the dispute over RealNetworks software," said Lloyd. 

Lloyd also declined requests from the plaintiff to question Jobs regarding Apple's refusal to license FairPlay to other companies as well as the companies use of the software on digital tracks from iTunes and the iPod. Both claims were dismissed from the litigation in December 2009.

"Plaintiffs remaining claims rely on the allegation that Apple attempted to maintain a monopoly in the audio download and portable music player market by issuing updates to FairPlay, Apple's proprietary digital rights management software," said David Kiernan, Apple's attorney. 

Also, Kiernan noted that "any deposition of Mr. Jobs would be repetitive, at best."

A deposition has not been scheduled yet, according to San Diego lawyer Bonny E. Sweeney, who is representing the plaintiffs, but a hearing regarding Apple's motion to dismiss the case is scheduled for April 18. 

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RE: Not really...
By snakeInTheGrass on 3/23/2011 12:23:41 PM , Rating: -1
Haha... or like when you have to go through some strange series of steps to enable an app provider. You don't need Apple, but for a lot of users who don't want to deal with really strange and archaic crap, it's a nicer alternative.

Instead of Apple controlling the ecosystem, you have phone where you can't get an OS update 6 months after they've been released. I'm sure that's much less annoying. Never had iTunes crash when syncing either, for that matter, but if I had maybe I'd be bitter too. ;)

RE: Not really...
By nafhan on 3/23/2011 12:43:33 PM , Rating: 3
when you have to go through some strange series of steps to enable an app provider
Since that doesn't really apply to the Android Market, I guess you're talking about enabling Amazon as an alternative app source? Complicated? Slightly. It's also, ironically, something Apple doesn't even let you do.

RE: Not really...
By SkullOne on 3/23/2011 1:31:13 PM , Rating: 3
Funny the Android Market doesn't require you to jump through any hoops to get it working.

Amazon isn't even that hard to get working. Plus since Amazon is actually allowed to have its own app store that's a HUGE plus. Competition is a GOOD thing.

Not sure what your point about an update every 6 months is. A phone shouldn't need near monthly updates like Apple pushes. This isn't a computer running OS X, Windows, or some *ux that gets monthly or weekly updates. Not to mention for me I had a Droid before my Thunderbolt. Droid has received 5 updates since it's release in November 2009. So that's an average of one update a little more then every 3 months with two of those updates being fairly substantial upgrades (2.1 and 2.2).

Apple only keeps giving out updates because they hamstring users by NOT giving them basic functionality and because they have to roll out huge bug fix updates after every major iOS update. It took Apple TWO DAMN YEARS to bring MMS and Copy/Paste to iOS. That's just sad. iOS still doesn't have true multi-tasking. Their implementation isn't "done right" like Lord and master Jobs claims. iOS multi-tasking is incredibly half-assed.

To top it off they force obsolescence on users by not enabling new functionality on older devices when they can do it. For example MMS on the original iPhone and no multi-tasking on iPhone 3G (which I had before my much better Droid). Apple cited "hardware limitations" as reasons for the lack of feature support. Yet, if you jailbroke the phones multi-tasking and MMS "magically" worked.

RE: Not really...
By Azethoth on 3/24/2011 5:51:38 AM , Rating: 2
"Yet, if you jailbroke the phones multi-tasking and MMS "magically" worked."
Yeah but the battery life goes to hell. A trade off is just that and they prefer not to have irate customers whining about 3 hour battery life instead of the 8-10 they are used to.

As for obsolescence, uhm I replace my iPhone every 2 years when the contract is up. I really do not care about my original iPhone anymore. Just my current 3GS and my magical 5 I will get this summer.

My Android using buddies have the same attitude.

RE: Not really...
By mcnabney on 3/24/2011 9:20:30 AM , Rating: 2
Yes, that is the reason for it. And they lied to your face about that reason and you have no problem with it.

I guess some sheep deserve to get sheared...

"You can bet that Sony built a long-term business plan about being successful in Japan and that business plan is crumbling." -- Peter Moore, 24 hours before his Microsoft resignation

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